The fourth version of the Draft Applicant Guidebook (DAG4) on new TLDs was the subject of much debate at the recent ICANN Brussels meeting (at which Valideus was a silver sponsor).
Should there be cross-ownership between registries and registrars? DAG4 states that applications will not be
considered from ICANN Accredited Registrars or their affiliates or entities controlling 2% or more of any class of security in such a registrar.Acknowledging in a foot note that,“The draft proposed strict limitations represent a default position and GNSO stakeholder-based policy development is encouraged”, ICANN is seeking a solution to enable it to combat bad actor registry operators who allocate valuable domains to associated registrars. Better compliance might be the obvious answer but as ICANN is not yet offering this, the Community in Brussels were offered a number of alternatives.
There was a practical proposal from the so-called JN2 Consortia which suggests that cross-ownership should be restricted to a 15% shareholding except in three cases:
- Single Registrant TLDs (which most Private Brand Registries will be)
- Community TLDs that do not anticipate getting more than 30,000 registrations
- Orphan TLDs that cannot attract a registrar to sell domains because their appeal is so limited
The RACK proposal put forward by a group including Afilias (the registry operator of .info which is owned by a consortium of registrars) proposed a flat limit of 15% on cross ownership with no exceptions which might have merits but felt like incumbent providers setting the terms of entry for new players.
In contrast the Free Trade proposal would eliminate cross ownership restrictions, allowing a registry (e.g. a private brand registry) to own its own registrar – but there would still be a requirement to offer other registrars equal access.
Most worrying of all was the Competition Authority Model which proposes referring applications for TLDs where there is cross-ownership of more than 15% to national competition authorities.
Can ICANN find a solution to this conundrum that does not upset the registry operators and registrars who pay them so much of their revenues? Why does this matter to IP owners? After all even the 2% limit on cross ownership proposed as the default position by ICANN could lead to problems if two other parties have 49% each?
It matters because brand owners seeking to apply must be allowed to place names in their own registries for use by their own staff without going through an expensive third-party registrar (or worse still) several registrars.
Related links: