|Brands Stake Claim to Their Top-Level Domains in First Round of Applications|
|Tuesday, June 26 2012|
Last August on Tuesdays with Tukaiz, we reported on how ICANN, the international ruling body of the Internet, was setting out to create a new set of generic top-level domains (gTLDs) for web addresses that will substantially augment the current .com structure we have all grown accustom to. While this move has been on the roadmap for ICANN since 2008, it still raised concerns from brands, marketers, and advertisers due to the potential for trademark infringement and the sheer cost for applying and nabbing a custom domain name ($185,000 per gTLD plus $25,000/year maintenance if approved). Nevertheless, that did not deter brands from laying claim to their namesake and many other types of domains as we discovered on June 13 this year, when ICANN released the first round of gTLD applications, all of which can be viewed here.
In total, there were just over 1,900 applications for new domains, and many on the list are what you might expect: American Express applied for .amex (and .americanexpress), Dell applied for .dell, and Xerox applied for .xerox. Many companies with branded products also applied for domains with the same name: Microsoft applied for .xbox and General Motors applied for .chevrolet and .chevy. While many of the applications have no conflicts, there are multiple applicants for a number of more generic domain names. For instance, .app has a whopping 13 applicants with Amazon and Google both in the mix. These conflicts will be handled through an independent review starting July 12 that will last for over 6 months to determine which entity receives the domain.
Speaking of Amazon and Google, both companies went big in submitting applications, willing to spend millions of dollars to ensure they have prime Internet real estate when these changes go into effect. Amazon applied for 76 domain names, including .aws (for Amazon Web Services) and .prime (for its premium Prime membership), as well as more generic domains like .deal, .free, .music, .read, and .shop. Google, meanwhile, applied for .android (for its Android mobile operating system) and .gmail (for its Gmail email service), as well as many generic domains like .game, .mail, .search, and .web. Both companies face competition for more generic domains, and it will be interesting to see who ends up winning the final application.
While most major brands will likely operate their gTLDs as "closed" domains that only their organization will use, there is also the prospect of "open" domains that will eventually be available for purchase by a broader audience to have their own second-level domain (think harrahs.casino if Harrah's Entertainment bought a second-level domain for .casino). A new venture-backed company called Donuts plans to capitalize on this model through buying gTLDs and licensing them to registrars like GoDaddy and Network Solutions. The company applied for 307 gTLDs (almost 16% of all applications), and around half are uncontested by other companies. While this will costs tens of millions of dollars to get started, the company has $100 million in funding and believes this model will be extremely lucrative as the face of the Internet changes.
Clearly, big brands are placing a big value on having their own namesake in a web address, as evidenced by the flood of applicants trying to secure their trademarks in this first round. If you missed out this first round, ICANN plans another round of applications in the future, although it has not specified a timeframe. The first of the new gTLDs will start to pop up in early 2013 and will be the true test to see if the investment was worth it.