In the last article we examined the language in Stuart Lynn’s A Plan for Action Regarding New gTLDs, and I addressed concerns about specific language in that document. In this article, I will examine several questions of importance that need to be addressed when discussing new gTLD policy; questions that Mr. Lynn leaves unanswered in his proposal:

How many new gTLDs should we eventually have beyond the “three more sponsored gTLDs” Mr. Lynn calls for?

I am not a network engineer, but well-respected voices whose opinions I trust (who are network engineers!) assure me that, despite ICANN’s publicly stated fears to the contrary, there is no legitimate technical reason anyone has brought forward why we can’t have hundreds or even thousands of new gTLDs. And the limitation certainly isn’t based on a dearth of unique alpha combinations: based on three-letter alpha codes alone, the permutations lead to more than 17,000 possible TLDs. If you add in four, five, or even six-letter gTLDs (e.g., .MUSEUM), and Unicode foreign-language alphabets?you get the idea! Therefore, if technical limitations aren’t driving ICANN’s reluctance to deploy new gTLDs, the only thing we can conclude is that ICANN is intentionally keeping the TLD count low in a greed-based manipulation of supply to frustrate the obviously strong demand and keep registration fees artificially high. This is unacceptable.

Virtually every business, organization, and interest group of any size in North America and Europe can be expected to eventually stand up an Internet presence, and this movement is quickly moving into less-developed areas of the world as people there discover the relatively low entry cost of Web publishing and ecommerce. This expansion is accelerating, and is driving the need for a great many more gTLDs in the near future than I expect Stuart Lynn is envisioning. Our challenge is to get ICANN to expand its processes beyond Mr. Lynn’s vision!

Will IP issues continue to predominate in these new gTLDs? Or should we finally say, “enough is enough already!” and make new gTLDs strictly first come, first served?

I obviously vote for the latter. Here’s why:

First and foremost, the current policy, which gives large trademark holders “first dibs” on domain names in new gTLDs, is fiscally wasteful. It has forced corporations to spend many dollars registering and maintaining domains that usually serve no useful purpose other than to redirect to the company’s .COM address. And by giving large trademark holders “first dibs” on domain names, ICANN ensures that each time a new gTLD is opened, companies will be forced to register and maintain the infrastructure for yet another set of domains for which they have no other legitimate business need—solely out of an ICANN-induced need to “protect” their trademark.

Second, the resulting corporate “land grab” artificially limits the number of unique domain names available for the public to register. Even assuming scrupulous adherence to “sunrise” rules (which hasn’t been the case to date!), after trademark holders stake out their turf, there are often few simple, easily remembered domain names available for John Q. Public to register. This only leads to pressure for even more gTLDs, the most attractive names of which are again sold first to trademark holders?and so the vicious circle continues. The result? Corporations are saddled with a growing inventory of “white elephant” domain names they really don’t need but must pay to maintain, while John Q. Public is stuck with easily forgotten domain names 10 to 20 characters long.

This is not to say that we shouldn’t have domains where trademarks hold sway. Certain domains, such as .COM and .BIZ, should be designated as “commercial preserves” where companies and their customers can expect trademarks to predominate. But everything outside of these preserves should be open to “first come, first served” ownership by anyone with the registration fee. We can assume that the more paranoid corporations will likely jump to be “first in” on any new domain, but we shouldn’t automatically penalize small business owners if they beat them to it. Which brings us to the following question:

How can we make the UDRP fairer to the small domain holder?

ICANN’s Uniform Domain-Name Dispute-Resolution Policy (UDRP) needs to be rethought, even within commercial domains. In the United States, prior to the Internet, numerous companies were allowed to use similar names for their business without being charged with violating a trademark, as long as they were in dissimilar industries or different regions of the country. And unless a business produced products for sale, there was never a compelling need for most small companies, particularly those in service industries, to trademark their names.

Nonetheless, many of these small business owners were quick to recognize the value of an Internet presence, and registered their names in good faith, often redesigning their entire business around them. The UDRP, however, changed all that. Now there can be only one instance of a name in each domain. Thus, unfortunately, when a large corporation coming late to the Internet party decides to challenge a small business owner over the domain name his or her small business depends on, it often results in the company with the deepest pockets winning the dispute. In fact, the mere threat of such legal action usually results in capitulation on the part of the small business owner; the case never goes to arbitration. Even if the UDRP process is invoked, by choosing the World Intellectual Property Organization (WIPO) as one of its arbitrators, ICANN has ensured that the process tends to favor commercial trademark rights above the existing owner’s free speech rights.

Nor is the UDRP process necessarily the last word in a domain name dispute: several UDRP disputes have moved into the civil courtroom when one of the parties was unhappy with the arbitration results.

While the loss of a domain name dispute minimally affects a large, well-known corporation—after all, its name is already “out there”—the impact of a domain name loss to a small business is often insurmountable. Consumers today often turn to the Web first when researching products and services, using search sites such as Google, and regional resources such as CitySearch, to find what they want. This fact is not lost on the typical small business owner, many of whom now eschew older, costlier forms of print advertising, such as newspaper ads and “yellow pages” listings in telephone directories, turning instead to inexpensive, virtually hosted Web sites to advertise or even sell their products and services. And with the advent of affordable broadband connections, email usage is already rivaling the telephone for business-to-business and business-to-customer contacts in the small business world. In fact, for small business owners engaged in ecommerce, email is often the primary method of communicating with customers. Consequently, taking down a small business’s domain name is equivalent to taking away a pre-Internet business’s telephones, and all its print advertising: businesses rarely recover from such a trauma. And the loss of any small business is not trivial—according to a U.S. Small Business Administration report, small businesses consistently contribute to about 50 percent of the Gross Domestic Product of the United States.

Although word is finally starting to penetrate to their level, most small business owners are still likely to be unaware that the UDRP exists, and that their domain name may not be secure if a major corporation decides it wants the name. Except for occasional anecdotal stories, the UDRP, as well as the connection between IP and domain names, is rarely discussed outside the Internet industry or IP law circles. Usually, the first time a small business owner hears about the UDRP is when he or she is dragged into arbitration. So what should we do?

• As part of the dispute arbitration process, weight should be given to the impact the loss of the domain might have on the current owner’s business. A domain name should never be taken away unless the current holder is using it in bad faith, and certainly not solely because one company has a trademark and another does not.
• ICANN should reexamine which entities are allowed to arbitrate domain name disputes, and appoint only neutral bodies with no bias. In that light, the WIPO should no longer be accepted as a domain name dispute arbitrator, due to its obvious bias in favor of trademark holders.
• In the interim, while current rules are in place, ICANN (or, if ICANN ignores its responsibility, the domain registrars themselves) should engage domain name holders, and the small business community in general, through the popular press and government agencies such as the U.S. Small Business Administration, to get the world out to small business owners that their domain names are in jeopardy unless they own a trademark, and to urge them to apply for trademarks.
Your comments are welcomed…