New Domain Names: What To Expect

The Internet Corporation for Assigned Names and Numbers' (ICANN's) long-running plan to dramatically expand the number of available generic top-level domain names, or gTLDs, should soon finally bear fruit. Then again, the real work for ICANN, domain registrars, businesses and other stakeholders is just getting started.

Today, there are 22 gTLDs -- the short string of characters to the right of the "dot" in Web addresses, like .com or .org -- available to the general public. ICANN, the governing body that oversees the public domain name system (DNS), approved a plan more than two years ago to increase by hundreds and likely thousands the number of available top-level domains. That would in turn exponentially increase the total number of available Internet addresses.

In the first major phase of the expansion, various organizations lined up to apply for ownership of new gTLDs. The cover charge wasn't cheap -- each application alone cost $185,000. Some applicants were domain name registrars with plans to sell Web addresses with the new suffixes, such as .inc or .web. Others were corporate behemoths like Amazon and Google that applied for gTLDs reflecting their brands, trademarks or other interests. Those applications were then evaluated on a variety of criteria, not the least of which was whether they were contested -- meaning there was more than one application for the same extension.

That phase is now complete and the first new publicly available gTLDs should begin hitting the market before the end of 2013, according to Akram Atallah, president of ICANN's generic domains division. That isn't guaranteed though, thanks to the operational and technical complexity involved in the wide-scale development of new Internet real estate.

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"Of course, there are a lot of other issues that we're resolving as well that are holding up some of the applicants," Atallah said in an interview. Those include resolving concerns around GAC advice, for one -- feedback from the Governmental Advisory Committee on domains that may violate national laws or otherwise upset cultural sensitivities around the globe. And while some contested gTLDs were resolved by the applicants themselves, others remain disputed; Atallah said those will soon enter an auction phase to achieve final resolution.

Yet another issue is "name collision" -- the likelihood that some of the internal names that IT departments use in their company's private networks, such as .mail or .corp, will end up as public domains. That could cause security and stability issues: "These private namespaces sometimes 'leak' into the public DNS (either through misconfiguration or the use of old software), meaning that requests for resources on private networks could end up querying the public-facing DNS Root Servers and hence 'colliding' with the delegated new gTLD," ICANN said on its website.

There have been a host of other concerns, too: the potential for trademark and brand infringement, confusion among Internet users and the fairness of an application process that required $185,000 just to get in the door, as examples.

In other words: Massive development of new real estate isn't all that different online than in the physical world, where a mess of zoning rules, local, state and federal laws, neighbor disputes and other issues introduces regular headaches and slowdowns into the project.

Successful applicants will eventually have the new gTLD "delegated" to them for administration. At that point, ICANN is longer in direct control of how quickly, if ever, a domain will enter the "sunrise" phase -- a 30-day period prior to it going live in the public DNS. Certain suffixes, like .basketball, were applied for by organizations that will likely use them for their own purposes rather than sell addresses on the domain to the public. The .basketball applicant was the Federation Internationale de Basketball (FIBA), for example, the sport's international governing body. gTLDs such as .architect or .pizza were applied for by companies like Donuts.co, a venture-backed domain name registrar that will sell addresses on the new gTLDs at retail. ICANN received nearly 2,000 applications in all.

The expansion has had its detractors. Some businesses have expressed concerns about trademark and brand infringement once new domains begin entering the market on a regular basis. If you own MyBusinessName.com, for instance, what's to stop someone else from registering the same name at 50 new suffixes?

ICANN launched the Trademark Clearinghouse to mitigate that issue, though it charges fees for each registration. Atallah estimated it has received north of 10,000 entries to date and hailed it as a benefit of the new domain names.

"This new program puts in place a regime of protections for [trademark holders] that has not existed in the past," Atallah said. The clearinghouse effectively gives trademark holders first right of refusal to register any domain name that might infringe on their marks. It will also provide secondary defenses, such as automatically notifying registrants that the URL they're buying may violate someone else's trademark. "It's a very good system that the community put in place," Atallah added.

He acknowledged, though, that the Trademark Clearinghouse primarily serves large organizations that register their trademarks -- and then hire armies of corporate lawyers to defend them. Smaller companies might not benefit all that much from the clearinghouse, though Atallah pointed out a different upside for them: It will be easier and less expensive to find a good domain name once the number of available addresses increases. Atallah believes that will benefit small businesses suffering from long, unmemorable URLs today. New businesses, too, deal with a lack of viable domain-name inventory unless they're willing to pay top dollar for a more marketable URL on the secondary market.

Not everyone entirely agrees with that perspective; some have pointed to the possibility of confusion among consumers conditioned to assume a .com suffix. Atallah said that ICANN will undertake some public awareness efforts, but ultimately the marketing responsibility for new domain names will lie in the hands of registrars and website owners.

"They're going to be able to go after their market much better than we can," Atallah said. "Just having a good [domain name] is not a guarantee for success."

On the technical front, Atallah encouraged IT departments to audit their networks now to ensure minimal risks of leaking to the public DNS as a result of internal naming conventions. An ICANN study of the issue identified only two domains, .home and .corp, as high-risk, though 20% of the applied-for strings remain "uncalculated," meaning ICANN has set them aside for further study. Atallah said that the leading certificate authorities have agreed to revoke security certificates for internal names within 120 days of delegation to the public DNS, and that that will provide plenty of buffer to minimize related security threats -- the lag time between delegation and going live will likely take at least that long, anyway.

Another parallel between online and offline real estate: the Internet has had its fair share of speculators, those individuals and organizations that buy up domain names in hopes that they'll be able to resell them later for a higher -- and sometimes a much higher -- price than what registrars typically charge. While it remains to be seen how well-received the new gTLDs will be, it seems reasonable to assume some people will snap up new domain names simply in hopes that they'll be fetch a fatter price in the future.

"Speculators will speculate -- I cannot predict what's going to happen and how the market will play out," Atallah said. "Just remember that by providing a large amount of choice, the [increased supply of domain names] will drive prices down. Even if there are speculators, they will not be able to command the same price they are commanding today because of limited [availability]."

Domain registrars like 1&1 Internet are already encouraging users to "pre-reserve" addresses with the new top-level domains, at no cost or obligation, for extensions like .app, .food, .hotel and many others. A ticker on the firm's site said recently that more than 2.6 million pre-reservations have already been made, although it's unclear just how much good the pre-reservation does. In its FAQ, 1&1 notes: "Unfortunately, we can't promise that your chosen domain will be registered, although of course we'll do our best!" GoDaddy, another large retail registrar, enables customers to "watch" new domain names that they want, but that ultimately amounts to an automated notification when that particular gTLD becomes available for public sale.

For now, the lengthy gTLD expansion project inches less toward completion, but to the starting line. What effects, large and small, it will eventually produce remain guesswork.

"I believe we're going to see a lot of innovation in this space and we're going to see new ways of marketing and using the Internet," Atallah said. "It has a lot of promise. There's a lot to keep an eye [out] for. It's a change in the industry and I look forward to seeing all of these new initiatives take place."

Atallah half-joked that anyone who knows for certain the outcomes shouldn't be making predictions; they should be writing business plans. But he pointed to areas like search, security and local business -- the new gTLDs include extensions such as .nyc -- as areas where the new domains could shake things up.

"Like any opportunity to innovate, it provides for disruption," Atallah said. "This disruption is what attracts smart people and innovators and I'm looking forward to seeing the results of it. All we can do is to provide the choice and the ability to innovate, and then we have to wait and see what happens."