As we wrote a few days ago, Monday is the last day for submitting your comments on the New domain extensions, the gTLD’s, which is an incredibly important issue for all domain holders.
It effects all domain holders because the rules that are applied to the new gTLDs can be used to amend existing contracts for all existing extensions. So even if you have no interest in acquiring any new gTLD domains, you still need to be interested in the contract under consideration.
As we stated in our previous post Mr. George Kirikos of Leap of Faith Financial Service, Inc. generously offered to allow anyone to endorse part or all of his thoughtful and excellent paper on the new gTLDs.
We are making that same offer.
Although we have in our comments, simply adopted and supported many of Mr. Kirikos positions, we have added some of our own positions as well and if any of you who have not commented to ICANN on this issue want to adopt any of our comments please feel free to do so.
So here is our opened letter to ICANN and our submitted comments:
In addition to our own comments which appear herein, we would like to support and endorse the comments made by George Kirikos of Leap of Faith Financial Services Inc. to ICANN posted on November 23, 2008 Mr. Kirikos comments are well founded, and right on point.
We specifically adopt the following positions of Mr. Kirikos, in his comments:
The introduction of new gTLDs by ICANN, will create mass confusion in the public, increase by many fold the already existing problems of trademark infringement, phishing attacks, and increased spam. The new extensions threaten the stability and security of the entire internet.
The only applications that should be accepted by ICANN are those few which will be a net benefit to the broader internet and not just simply because the applicant ponies up $185,000
No contract be approved that would allow for tiered pricing. Tiered pricing has reared its ugly head on several occasions, in the last VeriSign contract and again for the renewal of the .org, .info and .biz contracts.
We also agree and specifically endorse Mr.Kirikos comments regarding tiered pricing where Mr. Kirikos states Due to the equal treatment clauses in existing gTLD contracts, and the removal of price controls, the Base Agreement represents a Trojan Horse that can be used by existing gTLD registry operators to engage in tiered pricing.
As Mr. Kirikos notes the ICANN staff who oversaw the drafting of this base agreement demonstrated either a) utter disregard for the protection of registrants, ignoring the outcome of a debate from 2 years ago when the same contractual flaws existed in the .biz/info/org draft agreements, or b) incompetence for not understanding the interconnectedness of existing gTLD contracts that would be impacted by these new draft contracts, if adopted, or c) both. We agree that this is the equivalent of ICANN staff allowing SiteFinder or other past contentious issues to be in the base agreement, and should be treated as such, namely a grave breach of the public trust.
We believe that this topic should be barred from any contract either in this process or in future consideration of any new or revised contracts.
This issue has been dealt with, discussed and decided. Enough is enough with this already.
Allowing a registry to separately price each domain, on a arbitrary and subjective business, places each domain holder at tremendous risk of losing their domain, based on its own success.
The more successful an online business gets the more value the domain has and by allowing a registry to set a price based on the successful use of a domain, is clearly unfair and punitive to domain holders.
We also agree and specifically endorse Mr.Kirikos comments regarding 1.2.1, that the eligibility requirements appear to be overly broad. ICANN has a history of allowing dubious applicants to become registrars from companies associated with spam or fronts for criminal entities. The standards for entry into the root, a more serious obligation than that of a registrar, should be set much higher than that for registrars. These standards should include at a minimum civil and criminal background checks on its management and major shareholders.
We also agree and specifically endorse Mr.Kirikos comments regarding section 126.96.36.199, that history has shown that open gTLDs (like .biz or .info) have been failures. Open gTLDs should not be permitted at this time, and should be deferred until future rounds.
We also agree and specifically endorse Mr.Kirikos comments regarding section 188.8.131.52, the “Contract Execution and Post-Delegation” that the language must be made stronger. ICANN routinely approves all material changes to community-based applications. This represents a reward for “bait-and-switch” applications, whereby the applicants promise one thing, but then after their applications are accepted, devolve into something very different from what they initially promised. Severe financial and other penalties (including mandatory redelegation or tendering to other prospective registry operators) need to be in place to ensure that applicants live up to their contractual obligations, and not be rewarded for these kinds of games.
We also agree and specifically endorse Mr.Kirikos comments regarding section 1.2.5, that applicants will tweak their agreements to favor themselves, thereby creating Trojan Horses that affect registrants in other gTLDs.
The need for universal standard agreements that cannot be altered except through well publicized long processes with actual written notice to all existing gTLD registrants, so that they can make informed public input, is essential.
We also agree and specifically endorse Mr.Kirikos comments regarding section 1.3, that IDNs can and will be used for phishing, TM infringement, consumer confusion and malevolent purposes. Strong safeguards must be in place to prevent these activities.
We would go further and ask that ICANN consider allowing all valid trademark holders to receive their trademark for each extension for the normal registration cost for each new gTLD.
There is no reason that a trademark holder should have to pay a premium, that is an amount well above normal registration fees, to obtain and protect a trademark.
We have already seen in the rollout of the .me extension many clearly trademark terms sell for thousands of dollars and tens of thousands of dollars to other than the trademark holders.
This is an embarrassment to all those in the domain industry and it is ICANN failure to pass rules to prevent registries from auctioning off trademarked terms, that allowed this to happen.
To date the highest price paid for a .me domain is Toyota. Me for $90,000 to a company with no right to the domain. Moreover several of these .me domains that sold in the thousands of dollars have already been taken in WIPO proceeding.
Allowing registries to sell domains of famous trademarks and keep the profits from the sale, is a basic flaw in ICANN policies, which undermines ICANN credibility and the entire domain system.
If a trademark holder is entitled to a domain, like pepsi.drink, then they should not have to pay a premium to obtain it. It is already costly enough for large trademark holders to pay for all the defensive registrations, without charging them 5x-10x the price of a normal registration.
We also agree and specifically endorse Mr.Kirikos comments regarding the Attachment to Module 2, page A.
This draft contract itself opens up the 2-year old issue of tiered pricing for existing gTLD registrants, due to the lack of pricing controls in these draft agreements.
We also agree and specifically endorse Mr.Kirikos comments regarding the Attachment to Module 2, page A11, the lifecycle of a registration should require the redemption grace period, for the protection of registrants. Currently ICANN has created a mess at the .com and.net level for expired, non-renewed domains. Due to ICANN failure to pass and enforce rules on how a .com or .net, domain should be dropped by a registrar, we have a wild west situation where each registrar has can and has decided what to do whatever they want with an expired domain.
Some registrars, like Tucows.com pick whatever domains they want to keep from their customers expired domains, place them in their own name, without allowing them to drop. Tucows.com by its own admission has obtained hundreds of thousands of domains, by taking ownership of expired domains and warehousing them. Tucows.com has already set up a site to sell some of these domains to the public, Yummynames.com.
Enom.com also appears to have taken expired domains of its customers, placed them into a sister companies name and is selling them through and affiliated site, AcquireThisName.com
Other registrar send their expired domains to either namejet.com or snapnames.com where they are auctioned off to the highest bidder.
Other registrars like Godaddy, hold their own in house auctions, setting different starting prices, going into the thousands of dollars, based on the traffic a domain receives and the earnings of the expired domains on a PPC page owned and operated by the registrar. Included in these domains are many domain which are obvious trademark infringing domains, full of PPC ads containing the trademarked term.
Allowing a registrar to charge a minimum price based on a earnings of trademarked terms, clearly places registrars in the position where they make money off of trademarks. 2 Examples of this, just from the last couple of weeks, are edhardyclothing.com, an expired Godaddy registered domain, which sold on TDNAM.com, for its minimum price set by the Registrar, Godaddy.com ,in the amount of $6,880. The second domain DishNetwork.net (DIshNetwork.com is the official site of the company) sold for the minimum bid of $2,880. In essence Godaddy got paid for the revenue generated from trademarked terms appearing on clear trademark infringing terms.
The wild, wild west situation has one root cause and that is ICANN’s failure to adopt and enforce uniform rules for the expired domains.
Now with new gTLDs there must be clear and unmistakable rules for deleting domains for which the renewal fees go unpaid.
We urge ICANN to take this opportunity to adopt such rules for both the new gTLDs and existing .com and .net domains, that forces all registrars and registries to drop expired domain, after a standardized grace and redemption period so that the domain can be registered on a first come first served basis, or adopt a central drop service which a deleted domain would go to the first person to backorder a domain. A registry or registrar should not be allowed to keep the domains of its customers nor should it be allowed to profit from the sale of trademarked domain names and other expired domains. Each registrar should not be allow to create its own rules on how expired domains should be handled.
Finally we think it’s only fair that ICANN announces in advance if any adult extensions will be permitted, without requiring applicant to pay $185,000 to find out.
We all know the history of the .xxx extension, which was ultimately not permitted and voted down basically on moral grounds, upon the demands of the US commerce Department. If the .xxx extension was rejected on moral grounds ICANN should issue a statement that such an extension or .sex, .porn, .adult, will or will not be allowed. To require many companies to pay $185,000 non-refundable fee to find out ICANN’s policy is unfair and to all applicants and may discourage additional applicant who fear losing $185,000 and therefore do not apply.
This situation has again be dealt with, and the answer is either such extension will be allowed or they won’t.
But of fairness this policy must be made clear, before accepting applications, and 185,000 non-refundable dollars.
We respectfully request that our comments, along with Mr. Kirikos be given great weight in determining the future of new gTLDs and the handling of current extensions.
That is the end of our comments to ICANN. If you wish to comment to ICANN, once again here are the e-mail addresses to submit them to: