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August 26, 2011

News about the New Domain Extensions

Recently the online advertising industry encouraged ICANN from withdrawing its plan to release tens of thousands of new domain names onto the World Wide Web, arguing that it could financially damage brand owners. At the same time, ICANN announced the current Chief Executive will stand down at the beginning of 2012.

Interactive Advertising Bureau Statement

In a recent publication from the Interactive Advertising Bureau (IAB), many major corporations will be forced to spend a significant amount of money to purchase domain extensions for their brands such as .verizon and .facebook. The amount of money being pumped into these names is a result of the fear of cyber squatters who will purchase the extensions first and hold them for the highest bidder. Applications are set at $185,000 per domain extension.

CEO’s Statement

The CEO and President of IAB recently release a statement discussing that ICANN’s change has been out of nowhere. There has been no economic impact research conducted, no open stakeholder discussions and no concern for the impact it will have on the Internet ecosystem. As a result, this change could be disastrous for all brand owners, especially those that cannot afford the application fee.

Approving New Domain Extensions

In June 2011, ICANN approved a plan to significantly increase the number of generic top-level domains (gTLDs) which will increase the number of options to those searching the Internet. There are currently 22 gTLDs such as .com, .org and .net. However, the new approval is for gTLDs like .apple and .orange.

Associated Fees

The cost is $185,000 per domain name with $5,000 upfront. Many argue that the high application fees will deter cyber squatters from purchasing any gTLD. However, the IAB does not see this as a valid claim. Instead they are striving to show ICANN that this is an ill-considered decision through an unconfirmed process.

Chief Executive of ICANN to Retire

Meanwhile the current Chief Executive of ICANN decided to wrap up his tenure at ICANN, effective July 2012. In another statement he revealed how proud of all ICANN’s achievements. Further, in two years the employees have advanced the organization to a higher level of productivity and professionalism which resulted in a multination organization that will effectively serve the world for many years to come.

It appears as if there are many more groups, corporations and organizations against the new naming convention than there are supporters. Unfortunately the naming change could have a dire impact on branding and ecommerce, especially amongst those who cannot afford the associated fees.

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