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Questions on the Debate on ‘Closed Generic’ gTLD Applications

ICANN is currently seeking public comment on the subject of “closed generic” gTLD applications. It asks “whether specific requirements should be adopted corresponding to this type of application”. It invites comments on what it defines as an “issue”. In particular, ICANN wonders how an applied-for domain can be deemed a “closed generic” TLD, and whether there should be rules governing the way this TLD will be operated.

I question the methodological approach to the questions ICANN raises: Are there such things as “generic” TLDs? Aren’t gTLDs and “dot-brand” applications similar? Hasn’t ICANN forgotten many TLD already incorporate restrictions? Is something labeled a “closed” gTLD doomed to never open? And can antitrust concerns even be raised at this stage by ICANN or the community?

Are there such things as “generic TLDs”?

Though I will use the expression “generic TLDs” in the lines that follow, the domains we are speaking of are only generic for internet users whose language is the one in which these domains make sense. That a word is generic in one context does not make it have this feature in the whole world. Thus, the notion of “generic TLDs” is one-sided, and relates to a fraction of internet users only.

Time decides what becomes generic. .com, .org, .net and a few others have arguably acquired genericness over time based on how they have been used worldwide. The coming growth of the namespace will not necessarily turn the applied for TLDs into domains which can themselves be labeled “generic”. And it will not prevent anyone from using “generic” terms in similar ways.

Generic” TLDs and dot-brand are of a similar nature!

Though the community understands that it would make perfect sense for a company applying for a dot-brand to keep this space for itself, some are reluctant to see an applicant for a generic name exclude registrations to third parties.

But the question ICANN asks—should a TLD operator be permitted to adopt “open” or “closed” registration policies—should logically extend to all dot-brand applications. Why? Because trademarks, by nature, are limited rights on signs. These intellectual property rights are granted only in countries in which trademark registrations are filed. Their scope is limited to the products or services designated in the registration form. There are States where the trademark of a TLD applicant coexists with one or several other signs. Even in such a situation, this applicant is not barred from operating the corresponding dot-brand exclusively for its own benefit. There is no difference between this situation and an application for a ‘generic TLD’. No applicant has preexisting global and exclusive rights over the name it applies for, even in the case it is already well known under this name. If it is agreed that dot-brand applicants have the possibility to operate closed spaces, isn’t it an acceptance that closed gTLDs are allowed?

There are already closed domains!

Though the .mil space has been closed for decades, has anyone ever complained that there are immense fences around it? In other words, why distinguish between existing and future gTLDs? Why limit the debate to a fraction of the coming top level domains? That the question ICANN raises is only directed at some applied for TLDs may not seem logical: why treat differently those which are already there and those who will soon be born?1

.mobi auctioned premium names: hasn’t the creation of this financial barrier to registrations put this TLD in the category of ‘closed’ ones? Similarly, in the case of .tv, branded a as a generic TLD, certain names have a higher price than others. .tv is one of the countless examples of ccTLDs all around the world are restricted. .mc, for example, is open only to firms incorporated in Monaco, there used to be a namespace which accepted individual registrants only if they were of a certain religion, etc. Has .cat disadvantaged those who love felines or sell kitty litter?

What appears to be ‘closed’ now may open up later!

Applicants to a TLD have a model for it. They have decided how they will innovate with their new properties—and cannot be forced to do otherwise. With a few exceptions, applicants have not disclosed how they intend to develop it (and this is protected by trade secret). In the case of companies currently applying for ‘closed gTLDs’, couldn’t one imagine that there are applicants which have chosen to exclude registrations at the first stage, but have included in their plans the possibility to open the TLD after a while? This change may happen after their domain(s) have become desirable… or simply because the registry wants to lower its operating costs. ICANN opened a debate based on the assumption that a closed TLD will remain closed though it can evolve.

Antitrust concerns?

If ICANN allows closed generic TLDs to proceed, competition will suffer”, one reads in a letter submitted to ICANN. One can admit that the operation of a TLD may raise competition concerns: better positioning in search results, possible perpetual control over the TLD, costs of entry for competitors… But these concerns relate to ALL TLDs, and are not limited to those TLDs that are “closed” or “generic”. There are already examples of registries which registration rules were criticized and/or sanctioned for being anticompetitive2. But it was not the TLD nor the registry’s exclusive right on the domain that caused the claimed behavior.

Is it ICANN’s role to regulate the new market it is creating ex nihilo? Competition authorities have jurisdiction to address competition issues, not ICANN. Competition authorities rule in view of actual negative effects on the market (and more generally to the public/consumers), and applicants must face these authorities in kind. The current debate, however, rests on potential effects and is impugning motives on applicants. It is assuming bad behavior and is defensively cutting off innovation in favor of fear of these potential effects of a few.

Conclusion: the effect and the cause

The “issue” stems from a trial of intentions. The underlying question is the functioning of the name system itself. By design the DNS grants exclusive control to the operator of a top level domain. The creation of monopolies is inherent to the process ICANN decided to launch in June 2008. If there is a debate to open, shouldn’t it focus on the original intent of ICANN: technical control and policies for how registries operate and the scope of this control?3

1 This reminds of situations where leaders of a market push for norms that favor them against newcomers, instead of innovating (see R. Hale, Coercion and distribution in a supposedly non-coercive state, Political Science Quarterly, 1923).

2 There are already examples regarding .be, .de and .fr (see my book Le droit des noms de domaine (LexisNexis, 2012), pages 164 to 167).

3 The exercise of control could have possible antitrust consequences (see M. Lemley & M. Froomkin, ICANN and antitrust, 2003).

By Cedric Manara, Law Professor

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