Effective January 12 of this year, the Internet Corporation for Assigned Names and Numbers (ICANN), the contracted agency of the U.S. Department of Commerce that oversees the Internet’s addressing system, will change the extensions of Internet addresses (.com, .org, .net).
This would mean that individuals or companies would be able to apply for any word or phrase (including brand names) to use as an extension (which are also known as generic top-level domains or gTLDs). For example, Winn Dixie could purchase .winndixie or the Florida Times Union could buy .jacksonville.
But if you are interested in running out to buy your own .smith or .jones, you better have a big checkbook because the application fee alone is $185,000.00.
Assuming that the nation’s top registry company, Network Solutions, which is now owned by Jacksonville’s Web.com, sells and maintains these new extensions, their income could benefit. But at this cost level, most likely the only local companies who afford the addresses are CSX, Fidelity National or the Stein Marts of the local business world.
There are risks and rewards concerning the introduction of the new addresses that are outlined in a recent Internet Retailer magazine article by Phil Lodico, managing partner and co-founder of FairWinds Partners, a brands consultancy company.
Lodico says the benefits would be that companies like retailers could control branded space online and bolster their digital presence. But on the flip side, this program could provide cyber squatters an opportunity to buy brand names before the brands do. Online customers could be misled into thinking they are buying from brands they want but are actually buying from someone who only owns the brand name as an extension. It could also open the door for cyber criminals for phishing or other malicious activities.
According to John Obrecht, editor of BtoB magazine, the American Advertising Federation, the American Association of Advertising Agencies, the Association of National Advertisers, the Direct Marketing Association, the Interactive Advertising Bureau, the National Retail Federation and the World Federation of Advertisers oppose the new gTLDs.
He reports that these groups believe that the benefits are minimal and the costs and risks to security are too high. They believe that cost will go beyond the $185,000 fee because it doesn’t include the cost of monitoring and defending the gTLDs.
These associations are actively lobbying the Commerce Department to withdraw this program. But time is running out. Stay tuned.