CADNA: Costs Of Defensive New gTLD Registrations To Be Double The Total Cost Of All .Com Registrations

As pointed out by the Phil Corwin of the Internet Commerce Association (ICA) The Coalition Against Domain Name Abuse (CADNA) has launched another offensive at the new gTLD program teaming up with the Council of Better Business Bureaus (BBB) to launch a month-long “‘Know Your Net’ gTLD public awareness campaign”

“Their goal is to enact amendments to the U.S. Anti-Cybersquatting Consumer Protection Act (ACPA) that would expand the law’s coverage beyond domain registrants by creating secondary liability for domain system intermediaries like registries and registrars, increase statutory damages penalties for all targets, and establish a ‘loser pays’ regime that favors deep-pocket corporate litigants. If such a proposal was enacted it would vastly increase the litigation leverage of trademark owners and tilt the playing field against defendants in a manner that would result in a high probability of domain shutdown without any final verdict from a court. In short, it’s a SOPA-like proposal grounded in trademark rather than copyright.”

CADNA has claimed that defensive registration costs to brand holder will cost $2.4 Billion dollars

“If businesses register as aggressively [as they did at the .XXX adult content TLD] in all of the new ‘open’ gTLDs, they will be forced to spend almost $10 billion….“Domain name registrations in the new gTLDs likely will be lower than they where (sic) in .XXX. But even a quarter of the .XXX number of registrations would cost about $2.4 billion

The ICA counters that CADNA is basically claiming that the total cost of defensive domain name registration will be double the total cost of the cost of owning every .com and .net in the registry.

According to the most recent April 2013 VeriSign Domain Name Industry Brief there were 252 million registered domains at the end of 2012, of which about half (121 million) were in .Com or .Net. The average annual registration fee for a .Com or .Net domain is less than $10 – but let’s go high and assume that the average annual fee for all .com and .net’s are $10, they the total amount spent on all .com and .net registrations is around $1.2 Billion.

How can defensive registrations cost brand holders twice as much money as the total registration cost of the new .com and .net registry combined?

Of course there are a lot of other issues with the CADNA numbers.

To use .XXX as an example which had a retail registration fee of $100 and a had a high degree of defensive registrations due to the nature of the subject matter, we at TheDomains.com would expect only .sucks which is only one of 1,400 or so new gTLD strings to generate the amount of defensive registrations that .XXX saw.

We applaud the ICA for keeping an eye on trademark holders claims and the numbers.

We are watching too.

Comments

  1. says

    This is bad math. First of all, there isn’t just one more TLD being added – there’s over 1900. So with this logic the # defensive domains would be more than double – it could be 10x or 100x more.

    But the logic is flawed. Not all domains are brands and people are smartening up re the limited value of defensive domaining.

    The new GTLD’s also come with new appeal processes. I think it will be more common to see brands registering a couple GTLD’s for positive marketing and not for defensive reasons.

    With new monitoring tools (such as TypoAssassin for watching typo squatters), it will be more cost effective to use the tools + take action against the squatters vs simply buying up huge amounts of worthless variations that may never see a click.

  2. says

    Peter

    Also bad math there aren’t 1900 new gTLD’s being added the most was 1,409 the others being duplicates

    Around 80 strings have been withdrawn’

    There are over 100 IDN’s

    There are hundreds of brands that won’t be open to the public so the real number of new strings will be around 700 at most

    Brands are not going to registered TM in every extension it would be stupid

    There is going to be a cost but CADNA numbers are a joke

  3. says

    Yes oops my math was bad too :) but bottom line is that the CADNA could have come up with a better release instead of just some hypey calculation and no real recommendations on what brand owners should do.

    I think we both agree on this.

  4. says

    “establish a ‘loser pays’ regime that favors deep-pocket corporate litigants”

    It’d be nice if CADNA establishes a ‘loser pays’ regime for (non)members who abuse the system, too. But, I suppose that’s asking a lot.

  5. Grim says

    @+++Fre.ee+++Picti.US+++etc…

    Among a number of other high-profile companies, Apple does, but they wisely don’t care about the new gTLDs.

    Personally, I’m following their same thought process on the matter. Just watching the 1&1.com commercial makes me wonder how many “average people on the street” even understand what’s going on. The typical person with a restaurant, auto repair shop, or other Mom&Pop business are too busy working long hours to be able to really take the time to care, or totally understand this.

    And even if they do understand, getting a new gTLD and creating a website for it will likely simply be a waste of money.

    The Internet is global. If you have a global company or a digital or tangible product that you can sell to people anywhere in the world, then it’s good to be here. But if you have a pizza place in a strip mall next to a suburb, you’re probably better off just spending money on getting coupons out to the neighborhood that surrounds you. Your site will likely see little traffic at all, since most people typically grab a ‘take-home’ menu at your restaurant that explains everything they need to know for the next time they order. No need to go on the computer to see what pizzas you offer; it’s far easier to reach in a drawer and just grab the menu.

    But of course, it’s ‘cool’ to be on the Internet. 1&1 basically implies that with their ad. Even if you really don’t need to be here.

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