Tuesday, December 15, 2009

Fear and the Introduction of New TLDs

I was intrigued by the title of this article, "How can you protect your brand online if new domains are created?" from SC Magazine when it came across my twitter feed from minds + machine's New TLD News. Unfortunately, without even dealing with the inaccuracies and/or misuse of legal terms in the piece, the tone of doom and gloom for trademark owners compelled a response. The truth is that trademark owners should not fear the introduction of new top-level domains, as such an introduction is inevitable and trademark owners prepared for the process will be better positioned to control the costs associated with new TLDs.

The truth is that the implementation of new top-level domains in some undetermined form now appears inevitable. New TLDs concern trademark owners for primarily two reasons: 1) the potential misappropriation of a trademark by a third party as either a new TLD (i.e. to the right of the final dot) or as a domain name registered in connection with a new TLD (i.e. immediately to the left of the final dot) and 2) the costs associated with either the registration and use of a new TLD that incorporates the trademark owner's mark or the defensive registration of domain names incorporating the mark in multiple new TLDs.

With regard to misappropriation, the article quotes Charlie Abrahams, vice president and general manager EMEA at MarkMonitor: "Somebody else would get .barclays and sell it back to Barclays in the future, that is less of a concern as the costs can be high and it needs to be running for more than ten years, so that could be more than $1 million, and for a criminal this is a higher level of entry.” This is not a legitimate concern and Mr. Abrahams certainly qualifies this statement, but there are legitimate concerns for trademark owners, such as trademark owners that hold trademarks for terms identical or similar to trademarks held in connection with differing goods or services, i.e. the APPLE marks held, respectively, by Apple Computers and Apple Corps.

Another concern with regard potentially to misappropriation for trademark owners in this area is trademark terms that may be considered generic or descriptive terms in other contexts. To continue the above example further, a fruit-growing organization could potentially also apply for the .apple top-level domain.

Each trademark owner must be thinking about these issues now to determine best practices in connection with the implementation of new top-level domains. Nobody can credibly predict whether new TLDs will gain significant market share, as .com is still king. Nevertheless, nobody can similarly predict when ICANN will offer another opportunity to apply for new TLDs. The choice not to apply for a new TLD or to allow a third party to apply for the TLD associated with the trademark holder's mark could represent a missed opportunity for branding, marketing and advertising purposes that will not return for some time.

With regard to the costs attributable to trademark owners in connection with the implementation of new top-level domains, the article asserts, "there are instances where people get a desirable domain by paying for it and this has led to instances of people buying sites for high amounts of money." If the "people buying sites for high amounts of money" refers to trademark owners, then I think it is important to remember that we will not be returning to the ransoms paid by trademark owners for domain names associated with those marks prior to the implementation of the UDRP. The real concern for trademark holders is that the UDRP process is, itself, relatively expensive and the multiplication of multiple UDRP claims across various new TLDs could prove exorbitant.

First, it is not even clear at this point that the UDRP will be the most efficient procedure for contesting the registration and/or use of domains names registered to third parties that incorporate marks held by trademark owners. Second and most importantly, it is certainly not clear that many of the implemented new top-level domains will succeed to the degree that sufficient Internet traffic will be generated to justify the expense associated with a UDRP claim.

The fact is that new top-level domains are inevitable and the introduction of new TLDs poses particular concerns for trademark owners, both potential misappropriation and costs. Trademark owners that begin preparing for this implementation now, in partnership with counsel familiar with the myriad issues associated with this process, will be better positioned to deal with the concerns of misappropriation and costs. And those who prepare now will find that there really is nothing to fear in the introduction of new TLDs.

Tuesday, December 1, 2009

ICANN's IDN ccTLD Fast Track Process Updates

In relation to the discussion of IDNs below, ICANN is posting updates with regard to the IDN ccTLD Fast Track process here. So far 10 requests for IDNs have been submitted in five languages. Check back often to stay apprised of any information related to the introduction of new TLDs.