Global Economics

Changes to Internet Naming Policy May Lure Net-Squatters


Analysts and lawyers are warning that the decision to allow custom top-level domains will be a "nightmare" for brand managers

On Thursday, the Internet Corporation for Assigned Names and Numbers (ICANN) voted to allow--in addition to more traditional top-level domains (TLDs), such as .com and .org--theoretically any TLD at all, as long as it is no longer than 64 characters long. The application process for such custom TLDs looks set to be arduous and the criteria reasonably rigorous, but observers say the new system will create confusion.

"This has the potential for utter chaos," said John Mackenzie, of the law firm Pinsent Masons, on Friday. "The attraction for cybersquatters is not going to be setting up a registry that matches someone else's brand; it will be in the generic TLDs. All of a sudden, every brand will be forced to register their name at .shop, .buy and .london to stop anyone else getting it."

Mackenzie added that a similar effect was seen when the .eu TLD was introduced. "Our clients didn't want the .eu domain name but they felt they had no choice," he told ZDNet Asia's sister site ZDNet UK on Friday. "They had to register their brands as .eu names. Before that, it was .info and .biz and all the others. Each time a new TLD is introduced, large brands spend a fortune on defensive registrations to avoid the greater expense of recovering the names from cybersquatters further down the line. ICANN has just multiplied those costs. It's a brand owner's nightmare."

Roy Illsley, a senior research analyst at the Butler Group, echoed Mackenzie's sentiments. "It's going to give brand managers a massive headache," he said. "There will be a huge number of potential extensions. If [the brand owners] don't use them, then, if someone else gets them, it does potential brand damage."

"If you go beyond the brand, it's [slogans like] 'Every little helps' from Tesco," Illsley continued. "Can anyone use that? Once you've [made any TLD possible], you've really opened a can of worms."

However, a spokesperson for Nominet, the organization that runs the .uk TLD, told ZDNet UK on Friday that applying to set up a new TLD would involve "a significant investment".

"Once you're up and running, you'll be in for the long haul," Nominet's spokesperson said. "You will have to prove [beforehand that] that you've got the right operational skills and technical background and infrastructure to maintain stability on the internet. It's hard to say exactly how it'll turn out. There is an 'opposition' phase in there as well; people will be able to oppose certain applications. I don't think [ICANN] have made that part of the process totally clear at the moment."

David Meyer writes for ZDNet UK.

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