Friday, April 9, 2010

New TLDs a license to print money?

For a long, long time, internet users wishing to have their own domain name were limited to just a handful of generic top level domains (gTLDs) such as .com, .org, .net and various country codes such as .nz, .au, etc.

In 2000 and again in 2003/4, this limited number of gTLDs was extended by the inclusion of new ones including .biz, .info, .aero and others.

There have also been other specialist gTLDs mooted, such .xxx for "adult" websites but not much has actually come of that.

However, next year the floodgates will be opened for yet another round of new gTLD applications, with anyone being able to register their own gTLD if they wish to, and more importantly, if they have enough money.

How much money?

Well for a start, there is a non-refundable "evaluation fee" of US$185,000 for each application -- hardly pocket change and something that really limits these new gTLDs to big corporations or companies who are confident they can leverage this new cyberproperty for profit.

But the costs don't stop there. Even if/once your new gTLD is approved (not a guaranteed outcome of the "evaluation process"), you'll be paying an additional US$25,000 per annum to keep it alive.

ICANN (The Internet Corporation for Assigned Names and Numbers) claim that these fees are not set at a level designed to produce a profit (since the organisation is a "not for profit" one) but merely designed to cover the actual costs.

All I can say to that is that these guys must have some pretty fancy office furniture, medical and retirement schemes!

On the other hand, perhaps it's a good thing that the price of a new gTLD is set so high, since it does keep out the riff-raff and stops the DNS being polluted with a tsunami of vanity domains.

More information on the process can be found at the ICANN website.

Despite ICANNs assurances that this isn't simply a money-grab, I find it difficult to believe that claim.

Any sizable company wishing to protect its brand in cyberspace will soon have little option but to register it as a gTLD to avoid someone else doing the same and potentially diluting their trademark. Even those who choose not to register may end up paying fees to challenge attempts by others to hijack that branding by way of registering the same or similar gTLD.

It's almost certain that this cyber-landgrab will buy many a new BMW and Porsche for members of the legal fraternity but will it really do anything to improve the internet?

Do we really care whether a fast-food giant has its website at www.mcdonalds.com or www.mcdonalds?

What this does is create yet more potential for bunfights over who gets the rights to things such as the .mcdonald domain?

Is it this McDonald or this one? Clearly the former would not want to be mistaken for the latter.

If I were to try and register my own surname (simpson) as a gTLD, do you think that Fox Studios would allow me to do so or would they almost certainly object on the basis that (despite having legitimate claim to such a domain), my registration of that name would constitute a breach of their trademark?

When genuine trademark clashes occur both sides can end up wasting huge amounts of money dealing with an issue that simply shouldn't exist -- were it not for the decision to sell even more gTLDs.

New gTLDs not a license to print money?

I'm not so sure.

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