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The U.S. "Scorecard" for Brussels: Draconian Trademark Rules & The End of Private-Sector Leaders

Philip S. Corwin

The U.S. "Scorecard" for Brussels Proposes Draconian Trademark Rules — And May Mean the End of Unlimited New gTLDs and/or the ICANN Experiment in Private Sector-Led Internet Governance

(Note: This article is posted in my capacity as Counsel to the Internet Commerce Association)

On Friday, January 28th the U.S. Department of Commerce (DOC) circulated its submission to ICANN's Governmental Advisory Committee (GAC) containing suggestions for what positions the GAC should push for at its February 28 — March 1 meeting with ICANN's Board to air disagreements over provisions of the Proposed Final Applicant Guidebook (AG) for new gTLDs. While it remains to be seen how much support these proposed positions will garner within the GAC, the U.S. is a powerful influence. And, regardless of the overall GAC consensus, it is the U.S. government from which ICANN must obtain a renewal of the IANA root server operations contract by September of this year.

The upcoming Brussels consultation is not the formal forum invoked to resolve Board-GAC disagreements with finality. That second and final consultation has now been set for Thursday, March 17th in San Francisco — one day before the ICANN Board meeting that will close out the first ICANN meeting of 2011.

The U.S. proposals would establish "rights protections" measures that convert the new Uniform Rapid Suspension (URS) mechanism into a complete substitute for the UDRP and establish a "loser pays" regime that would place individual and small businesses at a great disadvantage. They would also effectively convert ICANN from an organization with private sector leadership to one in which governments had the final say on all policy decisions.

While the U.S. exercised sole oversight over ICANN when the process for developing new gTLD rules commenced four years ago, that oversight role was transferred to the GAC when the Joint Project Agreement (JPA) was terminated, and the Affirmation of Commitments (AOC) entered into, in September 2009. So the coming consultation in Brussels is not just a showdown between the GAC and ICANN Board over new gTLDs but the first real test of their new relationship. If ICANN's Board were to acquiesce to the positions advanced by DOC it would not only mark the end of a new gTLD program that envisions an unlimited number of applications and approvals, but the practical end of ICANN as a private sector-led entity in which policy is developed through a bottom-up consensus process. While ICA and others have sometimes criticized ICANN's fidelity to that model, we continue to believe it is the right approach. What the U.S. government is now proposing would convert ICANN into an organization in which the GAC moves from an advisory to a supervisory role — in essence, it would become a mini-UN for the Internet, exercising ultimate veto power over any new policies being considered by ICANN.

Let's start with the new gTLD issue that has so concerned ICA and its members — balanced rules for trademark rights protection.

Some background first: This contentious issue was simmering on ICANN's front burner throughout 2009. The Intellectual Property Constituency (IPC) got ICANN to create an Implementation Recommendation Team (IRT) to suggest a protective regime. ICA and others questioned the IRT's membership and manner of operation, and took strong exception to a number of its recommendations. The IRT report was unable to achieve consensus support within ICANN, so in late 2009 the Board asked the Generic Names Supporting Organization (GNSO), ICANN's lead policy group, to seek consensus. The GNSO in turn created the Special Trademark Issues — Recommendation Team (STI-RT) which, quite remarkably, was able to arrive at unanimous consensus within a few short weeks. The STI-RT's report was adopted by ICANN's Board and now constitutes the rights protection provisions of the AG. ICANN has been on record that the trademark protections in the AG are essentially closed, although the Board will consider revisions that "improve" their implementation.

The DOC has now proposed to not just throw out the work of the STI-RT and return to the IRT recommendations, but to actually go beyond the IRT. On (URS), the U.S. wants the GAC to ask ICANN to instruct its staff to alter the AG to (and we quote):

1. Shorten the time for filing an appeal in default cases from the current 2 year review period to a considerably shorter time.
2. Add a "loser pays" model applicable to domain name registrants.
3. Include the ability to transfer a domain name, so that the complainant is not forced to pursue a further UDRP proceeding to secure the transfer.

We doubt that any registrant losing a URS is going to wait two years to appeal, so we have no objection to revisiting that issue if there's a way to do so without doing violence to ICANN's policymaking process.

But the other two provisions were a bridge too far even for the IRT, and are unacceptable to ICA and its members. They can in no way be characterized as mere "improvements" to the current AG rights protection provisions, and would be highly detrimental to registrant rights.

A "loser pays" regime would give even more power to the large corporate interests who generally initiate UDRPs and would likely be the main users of the URS. Individual registrants already face a substantial economic disparity when they consider contesting a UDRP. A "loser pays" regime would have a broad chilling effect on domain registrations, as a registrant would face the possibility of paying a complainants' URS fees and its legal fees not just in regard to trademarks but to unlimited variants of those marks (when considered in combination with the U.S. position on the Trademark Clearinghouse, discussed below). The IRT Report was quite clear in its rejection of a "loser pays" model, stating:

A number of comments were submitted requesting a loser-pays system. The IRT considered a variety of situations and did not feel that this type of system can be implemented throughout the URS.

Likewise, the IRT emphasized throughout the process that the URS was being proposed as a supplement to, and not a substitute for, the UDRP — and that a losing registrant would face domain suspension but not transfer. As described in the IRT Report:

The URS will provide a low-cost and rapid means for taking down infringing domain name registrations, yet preserving a registrant's right to a hearing and/or appeal. In addition, the URS does not result in the transfer or cancellation of a domain name registration. Rather domain name registrations found to be violating a brand owner's rights will be placed in a frozen state, for the life of the registration, and only will resolve to a specific error webpage. (Emphasis added)

A footnote in the IRT Report further explains its reasoning:

The IRT received comments relating to the transfer of domains as a possible remedy of the URS. After much consideration the IRT decided against including transfer as a remedy since transfer as a remedy is already available in the UDRP and under applicable national law, such as the Anti-Cybersquatting Consumer Protection Act ("ACPA") in the United States. The URS is foreseen as just one of the tools available to brand owners for dealing with brand abuse in the domain name system. By keeping the remedy of the URS to 1) locking of the domain registration and 2) taking down the associated harmful use, the URS can remain quick while still balancing the right of the registrant by not transferring the property during an expedited process. In leaving transfer as a remedy to the UDRP and ACPA, the URS fulfills its purpose of becoming an addition to the existing available mechanisms without displacing the UDRP or ACPA. (Emphasis added)

By now proposing to make domain transfers available through the URS, the DOC is advocating that the URS displace both the UDRP and national laws such as ACPA. This would not only overturn the entire ICANN policymaking process that has resulted in the current AG provisions, but would thoroughly undermine the prospects for well considered and balanced UDRP reform. Ironically, the GNSO is set to consider a Motion to initiate an Issues Report on the state of the UDRP on February 3rd that would be the first step in such a reform process.

The DOC recommendations on the Trademark Clearinghouse also raise substantial concerns, especially as a listing in the Clearinghouse is the precursor to a virtual slam-dunk URS decision favoring the complainant. Those recommendations are:

1. Delete the definition of "substantive evaluation" to make it clear that any trademark registration, regardless of whether examined on substantive or relative grounds, can qualify for participation in the pre-launch sunrise mechanisms.
2. Expand the Trademark Clearinghouse to cover "trademark + keyword" or typographical variations specified by the rights holder.
3. Ensure that the Trademark Clearinghouse protection mechanism continues after initial launch.

Point 1, which makes Clearinghouse Registration available to any registration, regardless of examination procedures, will dramatically increase the number of listed marks while diluting their overall quality.

But Point 2 is the real worry — allowing rights holders to specify the typographical variations of a mark that can be registered in the Clearinghouse will lead in many instances to hundreds or even thousands of variations of a single mark, leading to potential URS losses for domains that are multiple degrees of separation away from the actual mark and that are not being used for a purpose that is in any way similar to the product and service associated with the mark. The degree of variation of a mark that qualifies as being "confusingly similar" is a complex matter that should be left to consideration in a UDRP reform process.

As for allowing registration of "trademark+keyword", we're not exactly sure what this means — but it appears to be an attempt to have the trademark protection regime for new gTLDs nullify U.S. and E.U. court decisions that have allowed search engines to sell trademarks as keywords, as well as to overturn recent UDRP decisions that allowed the unauthorized use of a trademark where the domain was associated with a legal business service directed to the trademarked activity. ICA has proposed that the UDRP be brought into alignment with evolving online trademark law, while this proposal seems to want them to inhabit separate universes.

Our concern over these proposals is further exacerbated by a seperate document being circulated, the "Proposed Organisation of GAC-Board meeting Topics". According to it, the GAC leads for the rights protection discussion in Brussels will be Suzanne Sene of the U.S., Mark Carvell of the UK, and Jayantha Fernando of Sri Lanka. We don't know where Sri Lanka stands on these issues, but Ms. Sene will undoubtedly be working to advance these DOC positions, and Mr. Carvell was an outspoken advocate for trademark interests in Cartagena and can be expected to engage in a repeat performance in Brussels.

While we can't predict how this will play out in Brussels, ICA will continue to oppose changes in the URS that would tilt it unfairly against registrants and make it a de facto substitute for the UDRP, while continuing to advocate balanced and well considered UDRP reform through ICANN's standard policy development process. UDRP reforms should be arrived at through careful consensus — not through a last-minute attempt to hijack the URS, make it a UDRP substitute, and then foist that on incumbent gTLDs, including .com, down the digital road.

Other key positions advocated by the DOC as recommended GAC starting points include:

• A waiver of any fees for governments participating in the new gTLD evaluation process — which will only encourage governmental interventions.

• Review by governments, through the GAC, of all new gTLD applications — with any GAC member able to raise an objection to a proposed string "for any reason", and with that single objection being sufficient to have ICANN block the application unless the GAC reaches a consensus to oppose the objection. This would not only give inordinate power to individual governments to quash TLD names associated with dissident groups, but would mean all but certain death for controversial applications like .gay (indeed, it's likely that .xxx would have been rejected out of hand under this approach). It also means that any business organization which doesn't think its objection to a proposed string will prevail under the standard procedure will seek to have a government object on its behalf, given that almost all government objections would constitute a de facto veto.

• "Community-based" strings would include not just particular groups of people or interests but also strings that refer to particular sectors, particularly (but not limited to) those subject to national regulation. But these days, in the U.S., EU, and other nations, what business sector isn't subject to national regulation? This would give any business sector, through its trade association or other designated representative, control over any string application that might otherwise bring about new online competition.

• "Community-based" strings would also have to provide evidence of support or non-objection from the "relevant authority/ties", although it's not at all clear who that would be for many potential community applications.

• "Community-based" strings that are "sufficiently contentious" would also be rejected. This could well encourage the noisy raising of objections to a particular application as a sure-fire means of terminating its chances.

• ICANN would have to establish criteria for the weighing of potential costs and benefits in the evaluation and awarding of every new gTLD, with all new gTLD applications being required to provide information of the expected benefits of the new gTLD as well as proposed operating terms to "eliminate or minimize costs to registrants and consumers". In addition, community-based gTLDs would have to operate in a manner that did not make it likely they would "impose costs on existing domain owners" — a standard with a totally unclear meaning.

• ICANN would reverse its position on vertical integration and restrict cross-ownership between registries and registrars except where it is determined that the registry does not have, and is unlikely to ever obtain, market power — that is, ICANN would have to determine that the gTLD faces or will face substantial competition. While we appreciate that ICANN has not given a good explanation for its varying positions on vertical integration, these restrictions could well make it impossible for gTLDs limited to particular groups with small memberships, as well as .brand gTLDs, to operate in an economically viable fashion. It would also turn ICANN into a competition authority for the Internet, expanding its role into antitrust issues properly left to governments.

• The law enforcement community would be granted its desire to have every applicant undergo a criminal background check; for WHOIS data to be accurate and publicly available; and for applicants offering the highest levels of security to have a leg up in the application process "particularly for those strings that present a higher risk of serving as venues for criminal, fraudulent or illegal conduct (e.g. such as those related to children, health-care, financial services, etc.)". Meaningful criminal background checks are so intrusive of privacy that even squeaky clean individuals may think twice before submitting an application.

Our three big takeaways from review and analysis of the DOC positions are:

• Procedurally, if they are adopted as GAC positions and if the ICANN Board acquiesces to any substantial number of them, the GAC will have established that under the AOC it and not the GNSO is the final arbiter of any ICANN policy development process. This would mean the effective end of ICANN as a private-sector led entity developing policy through a bottom-up consensus process and its transformation to a government-dominated entity in which every policy initiative would have to be vetted with the GAC at its inception and be subject to ultimate GAC veto.

• Substantively, adoption of many of these provisions would substantially shrink the universe of potential applicants for new gTLDs, both because many would be unable to provide new required supporting information or would be subject to some unexplained government's objection.

• Mechanically, given that there is a scant eleven days between the end of the Brussels consultation and the initial meetings of ICANN constituency groups in San Francisco, it is difficult to see how changes of the magnitude of those advocated by DOC could be transformed into operational language in the AG in time for its final approval in San Francisco. Assuming that the collective minds of the Board and GAC don't meet in Brussels, everything will come down to whether the March 17th meeting in San Francisco clears a path for Board approval of the AG the following morning.

Overall, we have no idea how the Board and the GAC will resolve their gaping differences in Brussels/San Francisco. Since much of the opposition to and concern over new gTLDs has been generated because of ICANN's insistence that it will accept and approve an unlimited number of applications, perhaps ICANN will recede on that point and thereby provide the diplomatic maneuvering room to avoid a publicly webcast train wreck. But developing a new system for evaluating and prioritizing a more limited pool of new gTLDs would bring outcries from impatient investor groups and take some considerable additional time to work out details.

Reportedly, ICANN intended the San Francisco meeting to be a launching party for new gTLDs. The GAC's assertive posture may well make that impossible. When Bill Clinton takes the stage in San Francisco to celebrate the ICANN experiment initiated by his Administration, will that experiment have just been effectively terminated by governmental intervention orchestrated by the Obama Administration?

By Philip S. Corwin, Founding Principal of Virtualaw LLC, a Washington, DC Law and Public Policy Firm He also serves as Of Counsel to the IP-centric law firm of Greenberg & Lieberman. Views expressed in this article are solely his own. Visit Page
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Great analysis Philip.Giving this sort of power Constantine Roussos  –  Feb 02, 2011 1:23 PM PDT

Great analysis Philip.

Giving this sort of power to governments is worrisome to me. "Diplomatic maneuvering" will be of essence to ensure that GAC's concerns are alleviated in a reasonable manner. 5 years have passed.

It seems a bit too late for GAC to demand a complete overhaul of the new TLD program and a slap in the face of ICANN community members. Why haven't they outlined these concerns the last few years and done something about it as opposed to waiting for last minute moves?

I look at the unfortunate case of Egypt and wonder if too much government control is good for the Internet community.

If ICANN does agree to more government control of the Internet, then the risks will be many:

- The balance of power will be lost
- Governments will have ultimate power to decide what is best for the Internet. History has shown that governments will do what is in their best interest and not the Internet community at-large.
- ICANN loses significance and it is a step towards its dissolution
- The bottom-up process is compromised and years of work by the ICANN community ignored

I am convinced that ICANN will do what is best for the Internet and the public interest. Governments serve their respective communities based on their nationality. The Internet stretches beyond these boundaries and serves the global Internet community as one unified entity that does not understand boundaries.

Are new gTLDs about the Internet or are they devised to serve governments? Some trademark constituencies are looking at GAC as their "savior" but do they really understand what they are giving up for this? Trademark issues will sort themselves out and due diligence was made. I am convinced that nearly all new gTLD registries will make sure trademark concerns are addressed the best way they can. For example, some new registries might choose to implement a GPML policy as part of their launch and going beyond what is standard. We all have to be responsible and ensure that new TLDs will create value and not be a nuisance. Ample work has been done to address these concerns by the ICANN community.

The Government Advisory Committee is an "advisory" entity. I hope their advice is taken into consideration by ICANN under the same process that mine and other ICANN community members' have been. This is truly bottom-up process and aligned with ICANN's AoC and its vision of one Internet that is united.

Once again a great analysis and article Philip!

Constantine Roussos
.music

I am convinced that ICANN will do Paul Tattersfield  –  Feb 02, 2011 4:10 PM PDT

I am convinced that ICANN will do what is best for the Internet and the public interest. Governments serve their respective communities based on their nationality. The Internet stretches beyond these boundaries and serves the global Internet community as one unified entity that does not understand boundaries.

I’m not sure ICANN can be relied on to do what is best for the internet and the public interest. I’m pretty sure the whole new gTLD process is riddled with fundamental flaws and the GAC’s concerns are just trying to mitigate some of the more blatant ones.

ICANN’s behavior hasn’t exactly been exemplary especially for an entity which likes to present itself to the world as a bottom up consensus driven organization

For example ICANN’s effective burying of whole sections of public comments has to raise serious concerns. The public comments in these forums have never been summarized.

http://forum.icann.org/lists/competition-pricing-prelim/ (April 2009)
http://forum.icann.org/lists/competition-pricing-final/ (July 2009)

And the links to the public comments were quietly removed from the “Awaiting Summary/Analysis area on public comment page http://www.icann.org/en/public-comment/ months ago and are still missing.

When questioned about this behavior it was stated the intention was to get the economists to summarize the comments after the then vote on the proposed final applicant book! And the reason for the delay? Because ICANN staff was not qualified to summarize the comments.

There was a similar delaying of the publication of DAG 4 summaries of public comment until after a subsequent ICANN Board Meeting.

The last but one set of Economic studies has never been summarized
http://forum.icann.org/lists/economic-framework/ (Closed July 2010)

The final Economic Studies were held back until days before the proposed vote on the final applicant guide book. The resolutions for approval of the final applicant guide book were written even before any public comment could be considered.

http://www.icann.org/en/minutes/board-briefing-materials-1-10dec10-en.pdf (Page 73)
Though the whole resolution is redacted!  Accountability? Transparency? AOC?

Then there is the Board/Staff 180 degree switch in position on the relationship between contracted parties and further compounded by the omission of any rationale for this fundamental change almost three months after the decision.

This isn’t a minor detail change this is a cornerstone policy change and at the 11th hour. Don’t take my word for it here are the concerns raised by a board member

http://www.icann.org/en/minutes/minutes-05nov10-en.htm

"I oppose this motion on several grounds. First, the resolution makes a very significant change in relationships between registrars, registries, and registry service providers. It will drastically change both the current dynamics of the domain industry and the way in which it will evolve. This change will be introduced concurrently with a major expansion of the gTLD space, and we cannot predict with any certainty the effects of either change, much less the combination.
"Second, the significant extent of this change makes it irreversible for all practical purposes. If unintended consequences appear that make it advisable to re-introduce some separation between parties, it will be impossible to do so without major disruption of the players in this industry.
"Third, in spite of the measures to be taken to ensure "good conduct," the resolution has the potential to commingle all of the data, public and private, regarding a registry in one place, providing the possibility of easy and invisible sharing of data within a merged or co-owned entity regardless of the scope of any agreement with ICANN.
"Such sharing is likely to be undetectable given the close affiliations among the entities. Data now forbidden to be shared between registries and registrars will be shared. Both auditing and enforcement by ICANN are unlikely to be effective, all the more so as we move from 20+ to hundreds of new gTLDs.
"Finally, a combined registry-registrar having the possibility of data sharing will have more market power than otherwise. Assuming that each gTLD registry must continue to treat all registrars equally, the real benefits of vertical integration are largely illusory, but those that can be easily obtained by the officially forbidden sharing of data are real.
"The removal of restrictions to vertical integration embodied in this resolution is unnecessary, and goes counter to both the interests of registrants and the global public interest."

Is such a major change at the last minute bait and switch?

http://en.wikipedia.org/wiki/Bait-and-switch

In lawmaking, "caption bills" that propose minor changes in law with simplistic titles (the bait) are introduced to the legislature with the ultimate objective of substantially changing the wording (the switch) at a later date in order to try to smooth the passage of a controversial or major amendment. Rule changes are also proposed (the bait) to meet legal requirements for public notice and mandated public hearings, then different rules are proposed at a final meeting (the switch), thus bypassing the objective of public notice and public discussion on the actual rules voted upon. While legal, the political objective is to get legislation or rules passed without anticipated negative community review.

There are numerous design reasons why the proposal for new gTLDs is fundamentally flawed at almost every level and as such needs serious revision. Many of these flaws have been missed or simply glossed over through process failings.

If ICANN is truly a bottom up consensus driven organization then it should be sending the new gTLD process back to the GNSO for revision rather than trying to out point governments whose day to day business is not the DNS and as such have to rely on input from lobbyists who are trying to pull this flawed process in ways that are less damaging to their client’s interests.

Paul,I agree on some of your points.However, Constantine Roussos  –  Feb 02, 2011 4:33 PM PDT

Paul,

I agree on some of your points.

However, can you tell me what inherent flaws the new gTLD program has that the current operational TLDs, like .COM, do not have as well as what needs to be done to address them. It is easy to criticize ICANN and claim that the process needs "revision" and leave it to the GNSO. What exactly are you proposing? A new economic report that tells us what we already know? Or new trademark mechanisms that go well beyond what is currently incorporated for operational TLDs such as .COM?

If you have solutions then it would be useful to showcase these solutions you are proposing and why you think they are critical to the success of new gTLDs. Please expand upon what these fundamental flaws are that ICANN inherently has in regards to the Guidebook. It would be useful if those fundamental flaws you claim to see in the existing guidebook be backed up with concrete facts and solutions. How would you solve the problems so there is a successful launch of new gTLDs?

I think ICANN has heard every side of the argument and all issues have been discussed extensively. I agree with you that governments' day-to-day business should not be the DNS. Relying on input based on lobbyists is not what I call good advise for the expansion of the Internet that would lead to competition, innovation and disruptive technologies.

Constantine Roussos
.music

However, can you tell me what inherent Paul Tattersfield  –  Feb 06, 2011 11:15 AM PDT

However, can you tell me what inherent flaws the new gTLD program has that the current operational TLDs, like .COM, do not have as well as what needs to be done to address them. It is easy to criticize ICANN and claim that the process needs "revision" and leave it to the GNSO. What exactly are you proposing?

Constantine,

I believe there are so many issues I find it incredible ICANN has the audacity to try and present the DAG as a credible framework for the expansion of the DNS never mind as for the wider the public interest.

The issues, implications and consequences are often interrelated and as a result complex; even a single issue like the last minute 180 degree switch in the relationship of contracted parties will inevitably have multiple and far reaching consequences long after the people advocating this thinking have moved on.

The Economic studies concentrated on the issue of defensive registrations to the detriment of other wider implications e.g. equal treatment, price caps, variable pricing, the markedly different economic impacts and costs for different categories/classes of new gTLDs etc.

As a result an opportunity to demonstrate how the expansion of the DNS could be implemented in a way for the wider public good has been missed.

We have discussed some of the specific issues before:  e.g. your memorable .fashion example over @ DomainWire last year to which I replied.

Different types of TLDs cause different issues and concerns this is why ICANN should introduce categories to the DAG.

Armani should not be allowed to apply for .fashion.

Not because Armani will suddenly start selling second level .fashion domains but because if new gTLDs give advantage then allowing a single private entity to purchase a private monopoly in perpetuity over its competitors in an industry it competes in should be an absolute no no.

How do you think Dolce and Gabanna, Ralph Lauren or Karl Lagerfeld will feel when they realize Armani controls dresses.fashion shoes.fashion handbags.fashion etc.etc.

Trademark Law doesn’t allow such advantage to be awarded for generic terms and neither should ICANN.

The conversation I have heard before was Constantine Roussos  –  Feb 06, 2011 2:52 PM PDT

The conversation I have heard before was what happens if Microsoft gets the .search TLD? Will that improve the Bing search engine? I think what many are missing is the correlation between business model and whether adding a TLD will make any impact to their business model or threaten their competitors (or one or two competitors). Do you believe Google will incur a financial loss if Microsoft owns .search? How does owning a TLD impact search results that Google otherwise monopolizes? A space that has a small number of competitors (such as search) makes no difference. Microsoft and Google are in the search business NOT the domain registration business. Creating verticals across .search will not improve their search algorithm. If it was such an issue why does Google or Microsoft not own search.com that is owned by CNET? This is because the brand of Google is larger than an generic term related to search.

Any judgment should be made on a case by case scenario. If Armani gets .fashion, does that mean they will be selling more apparel and making better fashion products because of .fashion? Armani is NOT in the digital space or the domain business. Unless Armani starts selling virtual clothing, then the distribution method (i.e domain names) will make minimal difference to their business model.

Please provide me with a short summary on how Microsoft can beat Google in search technology if they get .search? It will make minimal difference if any. Also explain how Armani can use .fashion to make better product and improve their distribution. Armani is about a product that is high quality, in low availability and high price. In other words, they compete in the scarcity business. Do you believe Armani or any fashion superbrand will get in the domain business to sell .fashion domains or use it to get an additional channel of distribution?

There are 3 primary ways people discover new things on the Internet: search, social and recommendations. How does Armani gain a monopoly by owning .fashion? Please provide me some concrete examples and how exactly it would work in the real world according to how people actually use the Internet. Remember, .fashion is a TLD not a fashion product.

I have already made comments to ICANN about practices that are anti-competitive. These are cases where big corporations object to TLD applicants on the basis of keeping the status quo and limiting competition. It is a true case by case scenarion. This is where comparative analysis needs more refinement to address cases where an industry that is highly competitive and involves thousands of stakeholders would get hurt if a large corporation decides to own the TLD that reflects their business category space. These only apply in industries that are highly fragmented, highly competitive, use digital distribution as a primary means of monetization as well as include thousands of stakeholders who would find the TLD desirable and be hurt if they are not allowed to register their domain in that TLD extension.

Constantine Roussos
.music

DNS is slippery Karl Auerbach  –  Feb 03, 2011 3:40 PM PDT

There is no technical means to prevent anyone from establishing their own DNS root, sans ICANN and sans ICANN rules, and filling it with TLDs and records (or simply pointing to existing TLD servers.) (In fact it has been done several times in the past and present - and the net has not collapsed into smoking rubble.)

In other words, the game that the trademark protection industry is playing (via government intermediaries) is potentially an internet game of "Whack A Mole".

ConstantineI chose .fashion as an illustration simply Paul Tattersfield  –  Feb 07, 2011 3:15 PM PDT

Constantine

I chose .fashion as an illustration simply because it was one you chose to give as an example in the DomainNameWire thread message #14 and your subsequent endorsement of my reply in message #17.

@gpmgroup - I agree 100% with your views. I felt the same way with Wolfgang Puck running .food. The same applies if a company like Universal runs for .music. What happens to Sony, Warner, EMI? How about ASCAP, BMI, SESAC? How about the Grammys, the NMPA, SoundExchange, Rightsflow etc. And those are examples of US-based music industry organizations. WHat about the rest of the world.

You were right these are exactly the problems for every vertical in the world.

What you now seem to be saying is these issues only apply to some instances…

These only apply in industries that are highly fragmented, highly competitive, use digital distribution as a primary means of monetization as well as include thousands of stakeholders who would find the TLD desirable and be hurt if they are not allowed to register their domain in that TLD extension.

I don’t believe this to be correct, what you are in effect now saying is that you now believe it only matters in “some” industries that you have identified or are perhaps similar to your intended uses for a new gTLD.

This problem is much more fundamental - Giving any company an implicit framework derived advantage through a contractual arrangement with the regulator to use and compete against their competitors in the same vertical is a serious breach of public trust.

The ICANN board in its November resolution recognized this conflict of interest and resolved to have ICANN’s compliance staff carefully monitor the .jobs registry future actions. This resolution was only possible because .jobs is a sponsored gTLD. In the GNSO’s proposal for new gTLDs it will not be possible to correct such inequities as they will be “designed” into the actual framework.

Not only will ICANN not be able to protect entities which have to compete from the second level, there is also no mechanism for ICANN with its current proposal to make sure new gTLDs end up with entities which will prove good guardians of the namespace. In fact much of the commercial interest for category defining generic new gTLDs may come from single entities seeking commercial advantage over their competitors.

Just to cover quickly cover a couple of points you raise…

Your .search example is interesting on a number of levels
Some organizations see value in generics for competing within their vertical market. Bank of America (bank.com) , Barnes & Noble (books.com), etc. So .search may be considered valuable to an industry incumbent seeking branding advantage.

Your example also highlights the problem of user confusion if some entities are elevated to the top level while others are forced to remain at the second level. e.g. google.search if as in your example Microsoft owns .search and or operates video.search and news.search

Any judgment should be made on a case by case scenario.
An elegantly designed framework should seek to minimize rather than increase humanistic determination.

As we are now identifying and discussing here, these economic impacts are not a single simple notion, but are in fact a myriad of often interrelated, consequential and dependant impacts and issues.  An additional layer of complexity is added because different classes/categories of gTLDs will have marked different costs (consequences) and benefits for innocent third parties.

Often these issues are so involved they need to be fully discussed by the wider community, the proper ICANN way to do it, and in the end likely the quickest way to do it, is send the DAG back to the GNSO for a carefully framed PDP and then have a public comment.

The first thing the PDP should consider is how categories can be introduced.  (The notion that categories would be unenforceable is quite frankly laughable especially when those same people suggesting this are also advocating being able to enforce a registry / registrar compliance code in preference to Vertical Separation of contracted parties.)

Then the PDP should consider the impacts and benefits for each category of TLD which will be markedly different, and tailor the proposed framework around minimizing the impacts for innocent third parties.

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