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New gTLDs Are Like Derivatives on Wall Street With No Value, Says Esther Dyson

In a story ran by the New York Times over the weekend, the viability of introducing hundreds of new top-level domains in the market has been criticized by individuals including Esther Dyson, a technology investor who served as the founding chairwoman of ICANN. Dyson likens ICANN's plan for the introduction of new gTLDs to creating derivative-like businesses on Wall Street that have no value. "You can charge people for it, but you are contributing nothing to the happiness of humanity."

Related topics: Domain Names, ICANN, Top-Level Domains, Web

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Ellery to ICANN: Just toss out TLDs altogether Ellery Davies  –  Sep 26, 2013 10:20 AM PDT

More than 2 years ago, I lobbied ICANN to scuttle plans for buyer-initiated gTLDs.

But, first, some background…

In the beginning, there were just a few TLDs. Most web surfers still think of the group as the legitimate core, because they represent an established cadre of online companies and organizations: .com, net, .org, .gov and, separately, the individual country endings, such as .co.uk, .il, .tv, .cc, etc.

Then, some wise guy got it into his head that we needed .info, .museum, .movie, and .xxx. (The thinking is bizarre: If you can’t eliminate porn, rope it off into a red-light district. Yeah, sure! This will surely deter my teenage nephew from checking out the hoochie-coochie). Even in June 2011, before the gTLD announcement, there were 22 gTLDs and 250 country codes. Now what? 650 proposed and millions when the cost barrier is struck down.

In their infinite wisdom, the governors at ICANN have decided to dole out arbitrary TLDs. (Thankfully, this does not include founding ICANN governor and chairperson, Esther Dyson. Like me, she understands that unleashing gTLDs will lead to waste, litigation and folly). Want your domain to end with .IveGotAStupidIdea? Be my guest! Just pony up an application fee of US $185,000 and soon, you too will be signing up anyone who wants their domain to end in this way.

Time for a level-headed rebuttal!

Concerning the ICANN decision to open the TLD floodgates, some have suggested that it is a “cash grab”. Perhaps that’s one motive. After all, ICANN wants USD $185,000 from each applicant. (Why?!). And one ICANN officer already has quietly set up a venture to capitalize on the forthcoming milieu. But considering the nearly unanimous vote, I suspect that at least a few ICANN members think that the idea has merit, even without the allure of personal gain.

Unfortunately, the idea has no merit! Implementing choose-your-own TLD will create market chaos. It makes TLDs irrelevant. Domain and trademark owners can’t possibly chase after every combination of letters in the universe. Under this scheme, we will all simply own domains with dot somewhere in the name.

More likely, it will have a “regressive” effect by making .com the only relevant TLD. In the end, that may be the silver lining. But it is still an asinine idea, because there is an easier way to achieve simplicity. In fact, .com is already akin to not requiring a TLD at all! In effect, you own the real-estate that comes before it. All other TLDs are irrelevant. (.gov is a possible exception, because it is controlled within a clearly defined venue).

Why is .com so relevant and important?
◾It’s the domain browsers add automatically (press “Ctrl-Enter”)
(there is even a key for it on the Android text-entry keyboard)
◾Domains that end with .us resolve to .com, even without .us
◾Search engines are biased to present them first

To illustrate, consider this: The CEO of Coca-Cola is Muhtar Kent. Once ICANN doles out generic and arbitrary gTLDs, which address below do you suppose Mr. Kent will use? Which would you choose?
◾mkent@coca-cola.com
◾mkent@coca-cola.{something else}
◾mkent@{something}.coca-cola

In the last two examples, the {something} is required! Without it, the address is illegal (it fails). Why would anyone want the address mkent@ceo.coca-cola? It is preposterous!

I am in favor of throwing away TLDs altogether. Let’s just agree that if you own the .com property, then you are a fortunate puppy. In effect, you own the words that precede it—the naked term. If you don’t own the .com property, then you are playing 2nd fiddle. You will forever be losing mail, because many senders accidentally address the “real” McCoy and not a “wannabe” (that’s you, of course!).

If you already have a domain ending in .net or .org (semi-credible alternatives) or even .info or .tv (positively ludicrous!), then use it in good health. But only in rare situations does using a non .com TLD make sense – and only if you own both .com and another TLD of the same word. For example, Verizon differentiates its staff and users by separating them into .com and .net communities. That’s kind of nifty, but it still leads to confusion and misdirected mail! FWIW: .com rules the web.

Ellery Davies clarifies law and public policy
Feedback is always invited.
- Ellery Davies

Ellery:You are absolutely correct that there is Enrico Schaefer  –  Sep 27, 2013 12:35 PM PDT

Ellery:

You are absolutely correct that there is a tremendous bias in both the back-end technology and public consciousness in .com. Dot COM has been king since day one.  Thus far, most of the other gTLDs are just a pretenders. That's not to say there have not been some successful TLD roll-outs that made a dent.But no one has touched .com.

But all the drivers towards .com are subject to change.  You give some great examples:

Why is .com so relevant and important?
◾It’s the domain browsers add automatically (press “Ctrl-Enter”)
(there is even a key for it on the Android text-entry keyboard)
◾Domains that end with .us resolve to .com, even without .us
◾Search engines are biased to present them first

Since Microsoft, Yahoo and Google, among many other huge pulbically traded corporations, appear to be committed to the new extensions, it won't take long before they start pushing traffic to the right of the dot.  The concept that Google will start providing a algorithmic bump for website users that are searching for "car insurance" to the new .insurance gTLD isn't so far-fetched. In fact, it would be consistent with everything Google says about what it wants to display for organic search results.  If Google creates a bias to new gTLDs for certain types of brand and industry segment search queries, it won't take long before companies start looking to the right of the dot as well.

And if you want a real game changer think about this. Right now the market for domain names is asked dreamily limited. The vast majority the market are people and companies doing something new. No one wants to try and move their.com website to a different domain and risk losing back links or suffering some other algorithm penalty.  I know I am not in a move my entire website to a new domain anytime soon. But what if Google decided to create a system by which I could move my entire website to a new domain without losing any organic search. Now the market for domain names is anyone who wants to launch a new website or move their old website to a new address. The point is this. Just because .com has been king for a long time doesn't mean it will be king forever. One little change in incentives can change everything.

That does still leave the problem of consumers. Everyone's looking for .com.  Again, it isn't so far-fetched that major corporations including Google start doing brick-and-mortar advertising pushing their new gTLD's.  When Nike starts advertising on the Super Bowl and pushing people to its domain Nike.shoes, you are creating possibilities that never existed before. As huge marketing budgets start pushing people to the right of the., it seems not only possible but likely that people will start looking for something that is not ".com." The concept that .com could become the ugly end of the Internet neighborhood is certainly a possibility. Consider that the vast majority of domains on.com are being used by anybody, show no website or otherwise junky paper click ads. Consider that allowed the world spam comes through .com.

Generally, I've been in favor of the new GTL the roll-out for one reason beyond all others. There are few words left with both trademark availability and available as a.com registration. Moving brands and market niches to the right of the dot makes perfect sense.

Enrico Schaefer

We can agree to disagree Ellery Davies  –  Sep 27, 2013 12:55 PM PDT

I acknowledge your reply and respect your opinion. But, mine is unchanged…

Incentives certainly lure traffic, but in the end, humans think of companies, products and brands; not an artificial hierarchy crafted by us Geeks. Unnatural constructs rarely triumph over straight talk. That's why I liken .com to owning the word or phrase to the left of the dot.

While I acknowledge that the choice brands & words are already taken (with .com), it is no surprise to me that given a few years, they almost always shuffle to the most well-known rights owners--and without legal intercession. That's how a free market works. That's how it is supposed to work.

Suppose that you push the Coca-Cola company to buy .coke, .Coca-Cola and a dozen fractionalized domains like .coke.soda, .coca-cola.soda, .coke.drink, .coca-cola.drink and the thousand permutations for all of their other brands and flavors.

What you get is market confusion, squatters & scam artists, and frustration over creation and profiteering of meaningless real estate.

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