gTLD Policy Report from ICANN 46 in Beijing, China
Posted by Jennifer Wolfe on 12th April 2013 in 360 Blog

The ICANN 46 meeting drew to a close on April 11th, 2013 in Beijing China. A week of meetings and discussions around the future of the internet produced dynamic discussions and ongoing debate on many issues. But the one clear message from CEO, Fadi Chehade, is that ICANN will be a more agile organization and will move forward with the roll out of gTLDs as approved by the Board via many years of policy making process in the stakeholder groups. Plagued by years of policy battles among the constituencies and stalemates in execution, Fadi takes a down to business approach to getting things done, but remains accessible and accountable to the many stakeholders he serves. Throughout the week, a few key issues emerged for gTLD applicants.

Policy vs. Implementation for future governance of the Internet. A hot issue of discussion was defining what is policy, and under the purview of the bottom-up stakeholder model subject to significant policy debate amongst the various stakeholder groups and a vote by the Board, and what is implementation and under the direction of the CEO and ICANN Staff. This stemmed from the very controversial Straw-man model which expanded what could be included in the trademark clearinghouse from exact matches to up to 50 variants which have been subject to past UDRP or court proceedings. The Strawman model was executed by the CEO based upon meetings with concerned IP and business leaders about the potential for abuse in an expanded internet environment. But, many felt it circumvented the policy making role of the various constituencies for a quick fix solution and didn’t hear the concerns of registries, which will pay the price tag for that expanded right. Additionally, the non-commercial house believes brands should not take away legitimate rights of others. While the result is certainly beneficial for all brand owners, it did raise questions that were addressed in a special session. During the session, there was general agreement that if there is a change that affects the rights and responsibilities of others, it is likely policy rather than implementation. One of the most prominent quotes came from a Google panel member: “regardless of whether we call it policy or implementation we are looking for predictability and stability or notice when our obligations are going to change. If there is a new obligation, then there should be a substantial notice and lengthy enough time for affected parties to comment and provide modifications or explain concerns and a reasoned explanation of how decision came to be.” They also suggested utilizing professional mediators who can assist in resolving disputes when stalemate is reached and that notice and due process should be the prevailing ideal. As leadership seeks to move expeditiously and others desire to remain in policy discussions, more will be sure to be debated about what must be remain in policy process versus implementation moves that can be made much more quickly by the CEO.

Government Advisory Committee (GAC) concern over certain new gTLDs. The governments of the world form the GAC, which advises the board and the CEO on public policy issues of concern to governments. A big theme from the GAC was the issue of closed generics (many of which are applied for by Google and Amazon). While we still don’t have an answer to this looming question, warnings from the GAC are expected to come Friday or soon after the meeting. This means for all gTLDs, there is still a possible barrier to the process. If the GAC issues a warning against an application or a category of applications for public policy reasons, then those applicants will have 21 days to write a response to the board and the board will then decide the fate of those applications. Some areas of concern have been about geographic regions, anti-competition, security and consumer confusion. While the GAC holds a few open meetings, the most substantive discussion is closed and thus we will all await their warnings in the near future. ICANN leadership made it quite clear that they intended to follow the applicant guidebook, meaning the board would have final say on those applications. But, if the GAC’s warnings are wide reaching, we can all expect significant advocacy by those applicants. How closed generics will be permitted to change into open systems or seek a full refund is all left up to the Board. Time will tell how this unfolds.

The launching of the Trademark Clearinghouse and Rights Protection Mechanisms. The launching of the trademark clearinghouse began on March 26, prior to ICANN 46, but many more details about how it will work become clear during ICANN 46. While entering trademarks (and 50+ variants subject to past disputes) can be entered, the primary purpose remains to participate in Sunrise. Based upon discussions by brands, most brands are only planning to use this for their primary or core brands rather than all sub-brands. While the cost to participate in the Clearinghouse is relatively administrative ($95-150 per trademark), the cost to participate in Sunrise periods will be subject to each top level domain owner and could be sizable for brands with big ambitions. The bright side is that the Uniform Rapid Suspension system will soon be in place to help brand owners rapidly and for about $3-500 take down a site that is infringing on a mark in the Trademark Clearinghouse. But, the Trademark Clearinghouse is not without controversy. Many of the registries and registries believe the cost has been shifted to them to provide brand protection with brand owners accounting for less than their fair share of the cost, potentially damaging the existing registry/registrar business model.

The emergence of a Brand Registry Group. The final controversial issue of ICANN 46 was the announcement of the intention to form a Brand Registry Group as an official stakeholder group or constituency of the GNSO. J. Scott Evans of Yahoo! led a presentation to the GAC about the critical differences of a brand registry from a generic registry. Namely, that brands operate the TLD for their benefit and the benefit of their consumers as a closed eco system, rather than one of selling second string domains to the public, and that the needs of that group will not be met by traditional registry stakeholder representatives. While some on the GAC seemed confused as to why brand TLDs are needed (a little late for that), there was a general consensus that the brand registries are different and may have different needs. While forming an official stakeholder group will take time, brands should be aware of the formation of this and other groups that intend to lobby and advocate for brand registries.

Security and Stability of the Internet with gTLDs. One of the most important discussions of important note to gTLD applicants is a potential security red flag for some gTLDs. In short, because many companies use an internal top level domain for their web or exchange servers for which they have a certificate of authority, there could be potential resolution conflicts if those same new TLDs were to go live. In a report from Pay Pal , the most prominent gTLDs of concern include: .invalid, .wpad, .home, .belkin, .corp, .lan, .domain, .localdomain, .localhost, .local, .intranet, .internal, and .private. The clear message from ICANN is that these top level domains could be delayed by as much as two years while the resolution issues are cleaned up, but would not delay the entire program.

While many other details were provided to clarify logistics of the gTLD program, it is clear that within the next few months, the first IDNs will start to go live and by 2014, we’ll begin to see the delegation of scaled expansion of the internet. While the ICANN environment is still dominated by registries, registrars and lawyers, the interest of brands and marketers in how the internet is governed will grow as consumer behavior migrates from .com to .brand. One thing is for sure, more and more brands are showing up at ICANN meetings and getting engaged in what is happening, how and why it happens. The next meeting is scheduled in July in Durban, South Africa.