The Top Policy Mistakes ICANN Made In The New gTLD Program

Now that everyone has had time to fully digest the big reveal of the new gTLD applicants and the strings applied for, its time to look at the biggest issues ICANN has created for the domain name system.

We are not going to look at mistakes ICANN made in the implementation of the program (such as the TAS debacle) just the fundamental policy mistakes ICANN made in our opinion which are have potential to cause a lot of problems, for the program, for ICANN and ultimately the applicants.

1.  Allowing generic TLD’s to be run as a closed Registry.

ICANN could have easily avoided what has already been biggest criticism of the program, allowing one company to own a generic term on a closed basis for the sole benefit and use of the applicant.

With Amazon applying to operate over 75 new  gTLD’s all on a closed basis, including .App, .Books, .Music , .News, .Shop meaning that no one besides Amazon would be able to register any domains under any of the extensions they get.

Basically Amazon would own the entire right of the dot space for any of the extensions they win.

Google has applied to operate some closed gTLD’s as well for Generic terms.

There is already an outcry from the media, bloggers and other groups.

It is not outside the realm of possibilities that the DOJ and/or their European Counterparts will take a look at this possibly pushing back the whole program or at least tying up what are about the best possible generic TLD’s for which there are many applicants.

We chatted about companies doing exactly this back in March 2011.

ICANN could have just not allowed this situation to occur by so stating in the GuideBook.

However ICANN didn’t and now the rest of the world is waking up to the fact that one company can own the entire vertical to the right of the dot and they are not happy about it

Its going to be a problem.

2.  Creating rules and pricing for the The Uniform Rapid Suspension System (URS) which no provider apparently wants to provide services for at the price set by ICANN.

ICANN set the URS system up under pressure of Rights Groups (TM) to make it a quick, easy and cheap way of taking down domains with a target price of $300-$500 for a complaint.

The problem is it seems that none of the usual suspects that would handle such matters have any interest in doing so at the prices suggested by ICANN and therefore ICANN is now back with this unsettled mess of the URS considering revising the rules which they spent years developing.

You can read more about this here and here

Its going to be a problem

3.  Didn’t Limit the number of applications by any one company.

It always seemed logical that ICANN would impose some sort of limit that one company or related companies with some amount of cross ownership, would be able to apply for, as not to allow a set of companies to control too much of the right of the dot.

I don’t know what the proper amount should have been; 10, 25, 50, 100, or 200 but clearly ICANN didn’t set any limit and over 20% of the 1,409 separate strings applied for can wind up being owned by just one company.

Once again when you talk about any one company controlling a substantial part of any market, its likely to raise eyebrows.

4.  Similarly Confusing Strings.

ICANN policy on Similarly Confusing Strings, well it pretty confusing.

Here is what the Guidebook has to say about String Confusion:

“ICANN will not approve applications for proposed gTLD strings that are identical or that would result in user confusion, called contending strings”

“The String Similarity Panel will  review the entire pool of applied-for strings to determine whether the strings proposed in any two or more applications are so similar that they would create a probability of user confusion if allowed to coexist in the DNS.”

When asked how string confusion is going to be determined, here is what Kurt Pritz the new head of the gTLD program had to say at the ICANN meeting in Prague:

“So the standards are published the way they are. ”

“So quite extensive discussion occurred all about this issue and how to measure that, whether it should be measured mathematically or through some algorithm or some matching program.”

“And it was decided really that confusion is a human reaction. ”

“And confusion and the likelihood of confusion should be determined by, you know, reasonable average people that are looking at strings that are familiar with the script and language of that. ”

“And so the standards very brief. ”

“But in the Guidebook there has to be a likelihood that user confusion would result if both these TLDs would be submitted. ”

“And that’s the extent of the guidance given to the evaluators.”

Wow, not much help

When I went to law school they taught students to draw contracts up with exact language, to avoid vagueness or something open to many interpretations, otherwise there is a good chance your client will wind up in court arguing over the language of the contract if any issue comes up with the other party.

By setting totally subjective standards that can’t even be put into words and leave it all in the hands of an examiner, well that’s just asking for trouble.

Is .inc confusingly similar to .ink (both applied for)?

And of course all the plural and singulars of the same word, .car and .cars, .auto and .autos plus twenty more of those, going to cause a lot of failures and under performing registries.

.Law and .Lawyer .photo and .photography, is another class of domains that should have been put together.

Going to be a problem

If you say them out loud they sound identical, however they are both well known terms and have completely different meanings.

Is .Ngo confusingly similar to .Ng (ccTLD of Nigeria) or .No (ccTLD of Norway)?

According to Alexa Raad of Architelos.com, “although ICANN has an algorithm to compare two strings to see if there is more than 30% “similarity”  it is still a judgement call, so it would have to be any string that is either visually or verbally similar enough to cause confusion for the internet user.”

I think ICANN should have went with some detailed standards and should have given the examiners much more guidance on what constitutes confusingly similar strings.

ICANN has an algorithm in place but hasn’t even set any guidance on how much weight that algorithm should be given by the examiner in making the decision.

It’s going to be a problem.

5.  Not limiting the number of new gTLD’s in the 1st round.

There are 22 TLD as we speak, so expanding the space by an unlimited number seems quite risky to internet stability which is part of ICANN mission statement.

I suggested at the time that ICANN select a reasonable number maybe a doubling of the space in every year so that in year 1 there would be 22 new gTLD’s and if there were no issues then 44 in the 2nd year and again assuming no issues 88 in the 3rd and so and so on.

Maybe that wasn’t the proper method but It seems it would have been a good idea of there was some limit.

 

Comments

  1. BrianWick says

    “no one besides Amazon would be able to register any domains under any of the extensions ”

    And once you get past the first 3,000-5,000 that might change hands at some kind of premium – it work against the owner of that non.com registry – because no one want them in the first place.

    I suppose an anti-trust suit would give a bit of credibility to those non.com extensions.

  2. says

    @ MHB, Excellent points,

    The truth of the matter is that it wasn’t like ICCAN wasn’t aware of these problems from the very beginning (some of these issues were raised several years ago by concerned groups and individuals as you have already mentioned), but ICANN still ignored these problems because they thought that what was going to be good for the big corporations was going to be automatically good for the Internet community as a whole too. Well there is certainly an area that the public interest and corporate interest overlap and that everyone could be happy, but there are also areas that are totally apart from one another which in the corporate interest case could be called “Pure Capitalism” and in the public interest case could be called “Pure Socialism”, we all have to accept the fact that in order to go forward we have to create a balance between these two factors and concentrate our focus and efforts within the areas that they overlap.

    So its not as if they didn’t know what they were doing, as the matter of fact they knew exactly what they wanted to do which was to steer the policies to benefit the corporations with total disregard for the public interest.

    Think about it, big companies like Google and Amazon would not have invested millions of dollars in to getting those closed gTLDs if they had no assurance from ICANN insiders that it was going to be okay. Some of those ICANN insiders are now working for the same companies that have applied for these New gTLDs which tells a lot about their mentality at the time that they were setting up the policies regarding the New gTLD program. (just my opinion)

    -

  3. BrianWick says

    Yes – ojohn – Pure Capitalism vs. Pure Socialism – and in their “Pure”est form they represent the 2 major political parties in the USA – and both need the threat of the other.

    And if it leans too far toward capitalism – well that is anti-trust with how the non.com extension is used.
    And if it leans too far toward socialism – well that is too much government which stifles new ideas and the free market.

    Amazingly, ICANN staying out of it did the right thing and let the market dictate.
    If the monopoly’s non.coms fall flat – well no risk no reward – that is capitalism
    If the monopoly’s non.coms are too successful – well that is anti-trust – and not ICANN’s job

    In all cases it is all contrary to Al Gore’s Utopian Internet he invented

  4. says

    Hello MHB,

    We are going to reveal something in this comment, that will thoroughly piss off many. The many I speak of care nothing about you and only their Greedy little selves.

    ICANN right down through the food chain have been involved in what is called “MARKET DILUTION”

    Because of the scarcity of Quality .COM choices , they chose to cloud up the perception of Business men and Domainers.

    They wanted to seemingly offer alternatives that they wanted to be percieved as great alternatives. Masking the true Strategic Importance of the .COM extension.

    Do a Google on “MARKET DILUTION’ for more info.

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

  5. samiam says

    “1. Allowing generic TLD’s to be run as a closed Registry.”

    __________________________________________

    Boo-hoo-hoo…how is this any different that a “domainer” grabbing a keyword .com and sitting on it? I see this big players (Amazon, Google, etc.) trading these gTLD’s for BILLIONS in some cases.

    The gTLD program is like domain investing, but at a much higher level.

  6. says

    You say market dilution, some say free-markets trump all else. Change is always happening, and unfortunately, most people tend to resist change rather than adopt to new realities.

  7. Jesus H Christ says

    “We are going to reveal something in this comment, that will thoroughly piss off many. ”

    Yes, Jeff. Thanks for the “big reveal”. Also, thanks for the hot tip to google what ‘market dilution’ means.

    Nobody had thought of this until you came along with such earth shattering insight.

    Gratefully

    Fantasy Fred
    ($6,000,000) (Equity Share)

  8. says

    Jesus H Christ

    You must have quite a cross to bear ?

    Not sure of your Intent as you like to remain hidden. Get over it !

    I have already been offered more by the way, I am waiting for a credible equity play, You wont believe it because you are obviously ,SOMETHING ???

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

  9. NJD says

    I just visited Mr. Schneider’s “use biz” site. “Wow” is all I can say…when you couple the content of that site with the posts that Mr. Schneider tends to leave here…well, let’s just say…”Wow”.

  10. Jesus H Christ says

    I have already been offered more by the way, I am waiting for a credible equity play

    Just so we’re clear- you’re saying that you’ve already been offered six million dollars for “usebiz.com”, but turned that down because you wanted an “equity play”?

    In thanks for your suggestion to google what “market dillusion” means, I would make the likewise suggestion you google “Pseudologia fantastica”.

  11. BrianWick says

    “Pseudologia fantastica” – that is a big word.

    How about just “Rubbing One Out” in front of the mirror – for us average non-doctor types

  12. says

    mike, that may be the best, most rational and balanced post i have ever seen in the 12 years since i have watch the new gtld program. so much of the program is based on the mistakes, the extremes, the lucky few, or amazing breaks (or gifts), yet in the middle is a chance for properly marketed namespaces to possibly become worthwhile, or no

    if only these were the type of discussions and points brought up in the constituency meetings, or better yet borad meetings, instead of a constant effort to game the system, BUT NOT ACT LIKE YOUR TRYING TO GAME THE SYSTEM, by the insiders as their “pay-off” for staying in the ICANN process.

    again, well said and nice post mortum on the last 60 days

    page howe
    newtlds.net

  13. says

    @ 2012 July 24 David J Castello

    Hello David,

    I have entrusted my full disclosure of who I am To Rick Schwartz only.

    A more complete partial disclosure or profile is easily gotten by going to my Blog
    DOMAINLAIR =

    link on my site UseBiz.com.

    (Contact Group) = Collective Think tank Master Mind Group I head up

    (Metal Tiger) = I am a Gemini/West horoscope AND (Metal Tiger) East horoscope

    My Branding Handle = Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

    If you type in FULLY my complete Branding Handle in Quotes on a Google search you will see why Branding handles are a wise move.

    Cheers !

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

  14. Blue Lagoon says

    Mike,

    Seems like you are considering joining the ever-growing “gtlds are destined to fail” camp.

    Getting more and more apparent that this is gonna happen for the very reasons you referenced so nicely.

  15. says

    Hello MHB

    I have watched the domainer space since 95 when I had my first start-ups.
    It has been one wild adventure to say the least. I watched and mostly observed quietly for many years.

    It draws a lot of parallels to being an investment broker in Both Commodities And Stocks And Insurance and real estate all of which I have experience in.

    Opportunist Capitalism is founded on kaos and Creative Destruction. It carries many players in its wake, and has ship wrecked more than a few.

    Rick Schwartz has talked about the many arrows we have all taken. There are many walking wounded among us. Some are so discouraged they are literally throwing away Strategically Valuable Virtual Business Foundations.

    The time for holding your positions for much higher future Multiples is upon us NOW. I have said this Rick has said this and Frank was doing his voting by buying the farm in the .com extension.

    With ALL this there are those that say the game is over, it is- NOT – over, and there are very savvy buyers of .COM Foundations as RICK CALLS THEM, as we speak. They are not buying the latest Kool-Aid flavor of the month. They are digging through the Dot COM vein and paying money in the secondary market for .COM extensions that are available and precious

    I don’t know how to make this any clearer. For the record Domainers are not stupid, they have just been Massively deceived of the facts. I root for Domainers, and have taken flak from those who dont understand my good Intentions, mostly because they think I am self Promoting.

    Let me make this very clear = My site will sell for millions regardless of any other factor naysayers can cook up in their Brains. All this is wasted energy, when they could be actively positioning themselves in front of the Huge price Multiple expansion in the Secondary Dot COM arena. As RICK Schwartz would say to all the naysayers, take a leap of faith and grab yourself some Values while you can. PLEASE

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

  16. CB says

    Let’s be frank; everything Beckstrom touched turned to sh@t. Now that he’s received his new-gTLD-indexed golden handshake and departed for junkets new, how about we just put the internet back the way it was and never speak of him again.

  17. says

    @ MHB

    You should be very proud to be gutsy enough to speak out on this issue as you have. I have read back through several times and you are “Dead Balls On”

    This whole contrived affair is a mess,which threatens the very fabric of a stable Business Platform. ICANN Needs Strategists not chuck hole pluggers.

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

  18. Mr.T says

    If the large corps keep the gTLD’s closed and unavailable to the public it could put the whole gTLD program at risk. There will be less exposure, less marketing and less awareness because a selected few control most of the gTLD space. If .com would’ve been treated the same way years ago, it definitely wouldn’t be where it is today.

    The best promo for ANY extension is to let the public register and use the extensions actively. That way the average Joe and Jane will be more aware of .com alternatives.

    If the best gTLD’s like .music, .news, .shop, .sports are closed, the whole gTLD program will be a massive waste. We all know ICANN doesn’t care though because ICANN is just in it for the money, they couldn’t care less about the outcome.

  19. says

    @ MHB

    To add to point #4 it seems like there is no mechanism to insure that only the best keywords that define a certain Industry or category are going to be chosen as gTLDs, it is simply assumed that the applicants are going to pick the best keywords, but what if for some reason they don’t, if their gTLD goes unchallenged and is approved that means that the better keywords that might have represented a certain Industry or category the best will be forever locked from becoming a gTLD since there can’t be strings that are too similar to one another.

    Now if all variations of a keyword that represent an Industry or category have been applied for in the first round then at least we know that some consideration will be given by ICANN as to which one represents that Industry or category the best, like if .realty , .realestate , .real or .realtor are all applied for then we can assume (hopefully) that the one that is chosen to be made into a gTLD is also considered to be the best category defining keyword by the professional associations and boards within the real estate Industry.

    But, what if there is a lesser quality keyword within an Industry or category that is applied for and it happens to be the only one without any challenge or contention. If that keyword is approved in the first round that means that all the better keywords that might have represented that Industry or category better will be blocked in the future rounds and the people within that Industry or category will be stuck forever with an inferior keyword as a gTLD. (just my opinion)

    -

  20. Michael H. Berkens says

    Your assuming out of .real, .realestate, .realtor only one will be selected.

    I think all three would be accepted, realtor is a TM and isn’t going to be denied because of the other, none of these are visually confusing nor are the phonically confusing.

    The fact that there is no guidance giving in the Guidebook or otherwise will led different people to reach different conclusions, which of course is the issue

  21. says

    @ MHB

    What about .home or .homes

    What about .jewelry , .jewellery , .jewellry , .jewelers , .jewels , ….

    which one sounds and looks better to you, and what if the one that is approved is not what most people have expected.

    -

  22. Mr.T says

    MHB, but there may be applications for those TLD’s in the next round.

    Who is to say that .jewelry is better than .jewellery or vice versa? One is US English, the other is UK/NZ english.

    This is going to cause ICANN a LOT of problems, which actually serves them right. They’ve been far too sloppy on the guidelines.

  23. says

    Basically what I am trying to say is that if an inferior version of a keyword is approved in the first round that is going to cause all the better choices that happen to look and sound similar to that to be blocked in the future rounds.
    -

  24. Michael H. Berkens says

    ojohn

    You are correct that any future application in the 2nd round or later can’t be confusingly similar to any string including those in the 1st round which is one of the reasons that over at right of the dot we advised people who had an interesting in applying to to do so in the 1st round.

  25. BrianWick says

    “The gTLD program is like domain investing, but at a much higher level.”

    The new non.coms are all about the registries making money – and that is not a bad thing
    domain investing and new non.coms – you WILL lose that battle

  26. says

    Michael, great points all. Especially the point on the guidelines (or lack thereof) for “confusingly similar”. In the event .inc and .ink are found to be confusingly similar, how do you speculate it would be decided which one to accept and which to reject? At this stage I’d be surprised if it did not involve money somehow. Speaking of which, if one of those two TLDs get denied, does that (those) applicant(s) get a refund? If not, think about that one: ICANN sets virtually no initial guidelines, accepts unlimited applications, then post-facto decides by arbitrary opinion which of the strings to reject and not refund the applicant(s) …. yea, that would be a problem. I don’t see how they can get away with it.

  27. Michael H. Berkens says

    MC

    “In the event .inc and .ink are found to be confusingly similar, how do you speculate it would be decided which one to accept and which to reject?”

    Well that’s pretty good question.

    It may depend on where the objection comes from, another words as part of the application vetting process if the examiner decides it confusingly similar then that’s one issue but if the examiner has no problem with it but one of the applicants follows the objection procedure & wins I would say the party who objected would get the string.

    Ultimately if its decided that those two are confusingly similar maybe it will go to an auction which will determine which one lives.

    Refunds and percentage of refunds are in the Guidebook, at this point the most I believe one can get back is 70% of the application fee and as time goes on and as certain events occur that percentage drops.

  28. says

    Another issue that could be of importance is the fact that even for the gTLDs that are going to be open to the public there is no guideline or requirements as to how the second level domains should be distributed within the non-brand strings.

    Although some might not agree that its ICANN’s responsibility to see to it that the second level domains are distributed in a fair manner, but in my opinion if ICANN really cared about protecting the public interest then they should have put some requirements in the guidebook to prevent hoarding of the best names by just a few entities (or in some cases by the registry itself).

    -

  29. Michael H. Berkens says

    ojohn

    The Guidebook doesn’t require that second level domains have to be distributed and certainly doesn’t require they be distributed in any certain way.

    Of course by the nature of a closed application, a registry doesn’t even have to distribute any domains.

  30. says

    “The Guidebook doesn’t require that second level domains have to be distributed and certainly doesn’t require they be distributed in any certain way.”

    @ MHB

    That might be okay for .brands which belong to certain companies, but when it comes to generic keyword strings that represent a whole Industry or category then what’s the use of having the new gTLDs if all the best second level domains end up in the hands of a few entities, we’ll have the same situation that we did with .com which was the reason that ICANN decided to give people more choices by introducing the New gTLDs in the first place.

    -

  31. says

    “I suggested at the time that ICANN select a reasonable number maybe a doubling of the space in every year so that in year 1 there would be 22 new gTLD’s and if there were no issues then 44 in the 2nd year and again assuming no issues 88 in the 3rd and so and so on.”

    Mike, Do me a favor, please don’t suggest something that is intelligent and rational. That would spoil the Clusterfuck to come and I have a feeling this could be epic.

  32. Louise says

    I suggested at the time that ICANN select a reasonable number maybe a doubling of the space in every year so that in year 1 there would be 22 new gTLD’s and if there were no issues then 44 in the 2nd year and again assuming no issues 88 in the 3rd and so and so on.

    Sounds very reasonable, similar to George Kirikos’ comment re new gTLDs during the objection period. Glad you’re not on board with ICANN’s brand of crazy!

  33. says

    @ Rick Schwartz,

    Mike, Do me a favor, please don’t suggest something that is intelligent and rational. That would spoil the Clusterfuck to come and I have a feeling this could be epic.

    I dont know about anyone else but this paragraph sent me into a laughing spell that took some tension off of this Cluster-fuck we now have to deal with.

    When will ICANN side with Business owners with pockets not as deep as Amazon and Google? I get the feeling ICANN is getting their fists full of cash behind the stage. Anybody else get this feeling?

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

  34. Miss Nomer says

    I think it would have been more appropriate to have had the headline of this article say “WHY THE NEW GTLD’S ARE GOING TO FAIL!” Lol!

    In fact, you have laid out these reasons brilliantly. They are so doomed. What gets me is the number of suckers that will be drawn down with them. Like moths to a flame.

  35. says

    Hello, MHB

    In a world where Creative Destruction Obsolesces Technologies in a New York Minute, this whole debacle was pushed by Large companies to feather their nests and guarantee dominance.

    I think you have most eloquently, given us an outline that Creative Destruction will claim this whole operation D.O. A.

    Case Closed !

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

  36. says

    The first round new gTLDs registry owners are going to make millions by selling these new gTLDs registry to late comers in this high level domain game.

    The early bird always gets the worm.

    If u are early to any game, you can always buy a bunch of bullshit and sell it for 10 times more money to the late comer who will eventually end up to be suckers holding a bag full of shit.

    Easy Money For Big Boys

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