New web addressing system turmoil for trademark owners as ICANN revamp domain naming system
Every director of a company with a web presence will know how important the right domain name is to their business. That’s why a new plan to expand the domain name system may soon cause a new round of havoc for trademark owners.
The current domain name system uses a combination of generic top-level domains (gTLDs) like .com, .net, and .org and country code top-level domains, (ccTLDs) like .co.uk and .co.br. ICANN is revamping the gTLD system in the most significant overhaul since its inception.
ICANN – the California-based non-profit corporation tasked by the US government to oversee the domain name system is adding new gTLDs like .app, .inc, and .music. Over 700 applications have passed the initial test and could go live in a couple of months. Why the overhaul? The domain name system simply ran out of choices for domain names and ICANN felt there was a need to expand the options available as more and more businesses around the world joined the digital space.
The expansion of the domain name system is set to bring a cash windfall for ICANN, with companies seeking to participate in the expansion bidding £129,000 just for the chance to reserve one of the hundreds of new gTLDs. The new system will allow registries which have been successful in bidding to own gTLDs like .shoes and theoretically sell second-level domains like “www.nike.shoes” to their customers.
ICANN has always had its fair share of critics, particularly aggrieved at the perceived American bias in the rules for domain name registration. This new system won’t make these critics go away any time soon. In the west, internet users could easily be forgiven for assuming the .amazon registration relates to the giant internet retailer, yet the governments of Brazil and Peru have opposed the registration, arguing that Amazon.com should not profit from ownership of .amazon, which refers to an important geographical area.
The addition of domain names like .map and .book means that companies will be able to register industry-specific internet addresses; however, this will also mean significant opportunities for bad-faith registration and cyber-squatting. Anticipating this problem, ICANN has implemented new “rights protection mechanisms” to protect trademark owners. This two-pronged process requires trademark owners to lodge a record of each trademark for $145 per year. Once verified, this will act as a protection mechanism against those who wish to register second-level domains.
Trademark owners whose records have not been verified by the Clearinghouse when the first new gTLDs are launched will not be able to take advantage of the corresponding sunrise periods and will not receive notices if someone applies to register a second-level domain name that matches their trademark. During a 30-day sunrise period, qualifying trademark owners may preregister for second-level domain names that match their verified trademarks, for example www.nikeshoes.nike
Neither registration process is perfect and will likely have numerous legal challenges. Imagine ICANN approving the .bucks gTLD registration, only for someone to register the “star” as a second-level domain name. Disputes over registration are already big business for IP lawyers, with rumours that the International Chamber of Commerce is charging in excess of £100,000 just to hear the disputes. The first approved domain names should be in use before the end of the year.