Google’s new gTLD application to operate the .APP new gTLD come under fire yesterday by the The Association for Competitive Technology (ACT).
In a a letter to Dr. Stephen D. Crocker Chairman of the Board of Directors and Mr. Fadi Chehadé President and CEO of ICANN, Jonathan Zuck President of the The Association for Competitive Technology which boosts having over 5,000 small and mid-size mobile application “app” developers and information technology firms.
“ACT is an international group of leading members of the app industry (“Industry”).”
“In addition to its small business membership, ACT includes sponsors such as Apple, AT&T, BlackBerry, eBay, Facebook, Intel, Microsoft, Oracle, PayPal, VeriSign, and Verizon.”
“ACT has been a prominent advocate and educational organization at a crucial time in the rapid expansion of the Industry. As a voice of the Industry, ACT has several concerns regarding ICANN’s preliminary acceptance of Google’s amended application for the .APP gTLD on May 14, 2013.”
Google’s “Eligibility Criteria” Will Stifle Innovation, Consumer Choice, and Competition
Google’s amended application is problematic because it allows Google alone to set eligibility criteria by defining app developers and the Industry as a whole. The amended application states:
Charleston Road Registry plans to develop and publish eligibility criteria for all registrants in the proposed gTLD and will work with its registrars to execute the eligibility verification process.”
Google is limiting the use of .APP to “provide a dedicated domain space for application developers.”
It will “develop and publish eligibility criteria for all registrants in the proposed gTLD.”
“An .APP gTLD should provide consumers with apps or content relevant to apps and allow developers a reliable space to promote their products. Innovation in the Industry means apps appear in new places every day. For example, apps are beginning to appear in cars, watches, and even refrigerators. Any eligibility criteria must therefore be broad enough to allow for further innovation within the Industry. Given that Google is a competitor in the Industry, its control over setting eligibility criteria and defining “app developer” is troubling.”
“These concerns are heightened when Google’s amended application suggests that it intends to use the eligibility criteria to promote its own economic interests. Google states that it will be “defining the meaning of the gTLD term, providing for the verification of registrants who will offer content in the proposed gTLD environment, and encouraging a specific use.”4 Google’s amended application retains the language from the previous version, asserting that it “considers the proposed gTLD to be a platform for innovation with existing and future Google products and services.”
As these quotes indicate, Google is poised to set restrictive criteria to register an .APP TLD, thereby stifling Industry growth and consumer choice. Since developers’ primary presence is online, shutting large portions of the Industry out of .APP would interfere with the prosperity of the community. Developers who are not chosen by Google to participate in will be denied the legitimacy of the .APP TLD. Consumers will also expect .APP to be all-inclusive. If .APP becomes sufficiently socialized, through marketing and search engine optimization, potential customers would not find apps that do not meet Google’s criteria, resulting in less choice and customer confusion.”
“Finally, the prospect of Google setting restrictive eligibility criteria and encouraging use of Google’s products and services raises obvious competition concerns. As holder of the .APP gTLD, the criteria and conditions Google develops will determine who is an “app developer”, which app developers are allowed to register domain names, what apps they can sell, and what services they use to support their apps. As indicated above, Google is poised to use its position of authority to gain an advantage over the services provided to developers and consumers. This is not just a speculative worry; in the past, Google has used its supposedly open platform, Android, to gain competitive advantage at the expense of app developers. Just recently, European antitrust authorities have announced an investigation into Google’s l preferential treatment to the Android smartphone platform and its mobile services.6 Specifically of concern to the European officials are the licensing of Android software and Google’s use of its agreements with mobile devices makers to pre-install and prominently place Google services.”
“The impact on the Industry will be severe. Most app developers rely on the services of third parties to provide functions for their apps, such as analytics, hosting, and security. Since many developers are small businesses, it is more cost efficient to contract with these third parties. Google currently owns several companies which provide such services to app developers. However, they are far from the only players in the market. There are hundreds of companies built around the app industry which provide services for app developers. As the holder of the proposed gTLD, Google has the power over potential registrants to require the use of Google services. This would allow Google an unfair competitive advantage in the third party market to provide services to app developers. It would potentially put thousands out of business when app developers are forced to switch to Google services, regardless of how well or poorly those services fit the developer’s businesses.”
“Because Google is a competitor in the app industry, the effect that it could have on competition and consumer choice with control over the .APP gTLD is deeply troubling. Google’s management of the .APP gTLD should not artificially benefit Google’s products and services.”
GAC Advice Needs Due Consideration
It is premature and improper for ICANN to approve this amendment given the Safeguards on New gTLDs issued by the GAC in the GAC Beijing Communiqué. The Communiqué suggests safeguards for the .APP gTLD that should be addressed before approving Google’s amended application.
GAC’s advice and Google’s application agree that .APP is a generic term which represents the entire app industry.
Because of the significant potential for consumer confusion and harm to competition, GAC has advised that strings representing generic terms should serve “a public interest goal”8. The GAC also stated that as a “general rule” gTLDs should be “operated in an open manner” and that the only exception should be strings relating to professional or regulated sectors.9 Where a generic string would have significant impact on a single industry, it is important to ensure that the TLD is in line with the public interest and operated in an open manner.
The restrictive eligibility criteria present in Google’s amended application does not meet the public interest test and is by no means “open”. Furthermore, Google’s argument that the GAC Communique does not apply to .APP because this gTLD is “restricted” and not “closed” is inapplicable because the GAC specifically stated that the only strings that should be able to set restrictive registration policies are those relating to professional or regulated sectors.10 As even Google asserted in their public comments to the GAC Communiqué, .APP does not target a regulated or professional sector.11 Even if the .APP gTLD fell into that category, the restricted access should “be appropriate for the types of risks associated with the TLD.”12 In this instance, Google’s amended application gives no indication how allowing them a restricted gTLD would provide protection for intellectual property.
The letter from the ICANN Board of Directors to the GAC dated June 6, 2013 indicates that ICANN had not yet evaluated the GAC Advice to the ICANN Board regarding Safeguards for new gTLDs. ICANN Bylaws require the Board to take into account the GAC’s advices on public policy matters in the formulation and adoption of its policies. It is therefore premature for ICANN to approve Google’s amended application since the GAC’s advice has not yet been considered by the ICANN Board.
We ask that ICANN implement the GAC advice that generic gTLDs such as .APP be operated in an unbiased and completely open manner, and reject any attempt by Google to control .APP as a closed or restricted gTLD.
Thank you for the opportunity to address these important issues.
Jonathan Zuck President