Love them or hate them, auctions are an unavoidable reality of the new Top-Level Domain (TLD) Program.

By their very nature, they create winners and losers. All that is in doubt is where the money goes—to the losing parties under a private auction model or to ICANN under their auction of last resort.

There are pros and cons for both models. But what if there was another way?

Instead of the two current options, what if the proceeds from auctions could be reinvested into the wider domain name industry to be used exclusively for the promotion of domains and fund efforts to support their uptake and use?

This is exactly what the Domain Name Association (DNA) is proposing as part of a new auction of last resort service for the resolution of new TLD contention sets in an effort to provide applicants with greater control and certainty within the auction process.

Following strong support from our members, we are excited to launch the DNA private auction model which will segregate and earmark auction funds to go directly to the promotion of domain names and TLDs.

How will it work?

The DNA private auction model is available to applicants deciding whether to resolve string contention via a private auction or ICANN’s auction of last resort.

In the case of the DNA’s private auction, the auction proceeds will go directly to promoting TLDs. Furthermore, auction participants receive a credit to join the DNA and have a say on how those funds are used.

The proceeds will be distributed as follows:

• First: Fees for the auction provider will be paid.
• Second: Disbursements, if any, will be made to auction participants.
• Third: Optional membership fees in the DNA will be paid.
• All remaining proceeds will go to the DNA.
• The auction winner will determine how those proceeds are allocated between funding TLD marketing and awareness campaigns and funding other DNA industry development efforts.

The benefits

The DNA proposed model provides participants with a direct, identifiable benefit; promoting domain name uptake to the target markets, segments and geographies of the auction participants, DNA members and the domain name industry members.

Because the winner’s auction payment will go directly into the promotion of domain names, the winning applicant will also benefit from being a recipient of the global, industry-wide campaigns conducted by the DNA. Auction losers receive benefits also. Most are domain name industry members. They will also receive free DNA membership and have a say in the disposition of the funds through the DNA’s Marketing Committee.

The auction proceeds will directly promote uptake and adoption of their own TLD.

Importantly, the auction winner can work with industry marketing professionals that are members of the DNA Marketing Committee to define and manage the campaigns and activities the auction proceeds fund. The DNA’s marketing committee will work and engage with agencies to conduct education and awareness campaigns.

Other benefits include:

Flexibility

• Participants can choose when to hold the DNA private auction and not have to wait for the scheduled ICANN auction.
• Participants can choose the auction provider, format, and length of the rounds.

Confidentiality

• Participants can choose to have the auction results kept confidential and not have details of the auction rounds or the winning bid made public.

DNA Membership

• Auction participants that are eligible to join the DNA have the option to have $20,000 of the auction proceeds go to cover their first year’s membership in the DNA at the Strategic level, giving them a voice in how auction proceeds are used to support TLDs.

Why choose a DNA auction?

As the industry’s only non-profit trade association, the DNA is the best placed organization to accept and activate the funds in the interests of the wider industry.

Our mission and primary purpose is to promote domain names. Nearly all our resources are dedicated to this cause. Auction funds will be segregated and earmarked specifically for marketing, promotion and education, to enable us to achieve our purpose. No other current auction or dispute resolution mechanism available provides this certainty,

Under the DNA model, applicants get a seat at the table and direct involvement in the reinvestment of these funds to promote domain names.

The significant funds collected via these auctions has the potential to make a valuable contribution to global awareness and educational programs, which will benefit all TLDs, and their registrars and generally raise the reputation of the Domain Name Industry.

Our message to applicants in a contention set is a clear; consider the merits of the auction models available and evaluate which one offers the greatest overall return on your investment.

We encourage applicants to visit http://thedna.org and http://thedna.org/news_dna_auction_plan.php for more information.