Courtesy of our friends at Mind +Machines, it appears ICANN has based it budget on its prediction of 500 applications for new gTLD’s on the initial roll out.
The document showing this is ICANN’s New gTLD Program Budget.
As M+M states, ICANN estimate of 500 applications doesn’t take into account duplicate or conflicting applications.
“If we suppose that 25% are in conflict, that would leave us with approximately 425 unique TLDs applied for. Subtracting a further 10% who drop out, that leaves 382 new TLDs that we can expect to see delegated.”
Other findings from the ICANN report:
The majority of gTLD applications are expected to be “straightforward,” with no need for complicated and time-consuming procedures.
ICANN expects the Independent Objector to file objections in less than 5% of the total applications.
ICANN expects just 5% of applications to fail the initial evaluations, and another 5% to request refunds prior to the end of the evaluation stage (some of these refunds would be due to conflicting applications but that seems low to me if 25% of the application will be conflicting)
M+M concludes that the report indicates that ICANN is intending to pass approximately 90% of the applications.
As I read the budget, ICANN failed to take into account any contested extensions, most of which will be resolved by a auction with the high bidder getting the extension.
Without any of these auction revenues included in the budget, ICANN is still showing making a profit on the 500 new gTLD extensions of $1,846,000.
However as we all know there will be some contested extensions which will be resolved by auction, with all that additional revenue going to ICANN.
Any budget which does not anticipate any such revenue is flawed.
The most causal observer will conclude that some contested extensions will go into auctions whose high bids will wind in the seven figures.
Moreover I believe ICANN stated on many occasions that the new gTLD process is to be revenue neutral.
How can it be revenue neutral if it is already showing a $2 Million dollar profit without taking into account any auction proceeds?