What are risks and opportunities of new gTLDs?

The gradual introduction of new generic TLDs was meant to lighten the burden on the domain market somewhat. Practically any term was allowed as long as it complied with ICANN’s guidelines. This freedom led to controversial suggestions like .guru, .sucks, and .wtf as well as other numerous lengthy proposals.

Risks and opportunities when registering a new gTLD

ICANN’s decision to loosen address allocation and create new top-level domains proved to be popular from the start. Just a few months after people caught wind of the decision, businesses, cities, and communities as well as non-profit organisations rushed to register their desired domains. The suggestions included trademark domains like .apple or .bmw, regional references like .nyc and .boston, as well as general terms like .love, .blog, and .shop.

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But in the midst of rejoicing about this new-found freedom, there was worry about whether competing companies or critics would already own the ending you wanted for your brand name, product line, or business segment. The organisation, which is advertised by ICANN as a domain name registry, is ultimately in charge of deciding the availability of a domain ending and the usage guidelines. The result was a lengthy discussion whereby different stakeholders claimed certain top-level domains for themselves and consequently tried to stop others from using them. For this reason, the new endings include numerous exclusive top-level domains, which are not available to private users at all or only to a limited extent.

Brand nTLDs

These include nTLDs that are intended to be used exclusively by brand owners. Around a third of the applications processed by ICANN account for businesses and organisations that want to register their own name domain as administrators. This includes companies like Apple, Google, and BMW. They don’t necessarily register the domain because of its advantages, they are sometimes concerned about cybersquatting, which is a practice that involves someone else occupying a domain ending.

For private persons, there is hardly any risk of accidentally registering a trademarked new TLD since trademark nTLDs are not offered by traditional providers.

Tip

Want to learn more about cybersquatting and the differences with domain grabbing? Check out our article on domaingrabbing and cybersquatting to learn more about the two registration practices.

Domain endings with CPE status

The ‘community priority evaluation’ (CPE) was introduced by ICANN to allow stakeholders to protect popular endings from large corporations. If a community application is submitted to ICANN, it is given priority over conventional applications. This can only happen when the applicant can prove that the majority of the affected community supports the application for the domain. Site owners generally make domains with CPE status available when they are part of the community or a specific industry. This is how .hotel endings focus solely on hotels, hotel chains, hotel associations, and hotel marketing organisations. In order to prevent your own domain from being blocked, or to avoid legal disputes, users should check relevant community domains in advance to see if they fulfill the necessary requirements.

Regional nTLDs

Domains containing regional references have become very successful over the last few years. New domain endings like .london and .wales offer the benefit of presenting an offer in a regional context, allowing site owners to directly address the desired readership. In order to register an nTLD, website owners usually have to prove that they have a residence or a registered business in the appropriate region. This helps safeguard against the nTLD being misused. A popular tip to still be able to use these new TLDs is to register a domain through a local trustee that’s acting as a registrant for the actual holder.

Controversy when allocating new top-level domains

Customers pay a monthly fee for registering a domain. Supplying address suffixes is a profitable business for administrators of popular nTLDs. The basic problem with new TLDs with high registration volumes is that they put wealthy businesses in particular at an advantage as they are equipped to pay millions in licensing fees. There are many nonprofit organisations that would like to reserve some of these new domains for themselves. The lengths individual businesses go to to occupy general nTLDs as brand domains is an additional factor that can potentially lead to conflicts.

ICANN’s guidelines generally exclude the exclusive use of general language terms. However, the administrative body’s decisions have repeatedly caused annoyance in the past.

Amazon not so lucky with its own brand nTLD

The online mail order business, Amazon, didn’t have much luck when it came to registering its own domain in 2012. When applying for the extension .amazon in 2012, the company had to appeal an objection from the Amazon Cooperation Treaty Organization (ACTO), a group promoting the development of the Amazon basin. Led by Brazil and Peru, the group wanted to use the domain for websites about environmental protection measures and the rights of indigenous people. The alliance also insisted ICANN make a new rule so that geographical categories have special protection.

in 2019, a full seven years later, ICANN sided with the conglomerate and granted Amazon the rights to use .amazon as a trademark TLD - much to the disappointment of ACTO members, who, incidentally, had been offered Kindle readers and other products worth five million dollars by Amazon during the course of the dispute.

Pre-programmed problems with nTLDs

Among the freely available nTLDs, there are some options that could prove to be fertile ground for legal disputes. These are domain endings that have the potential to defame businesses, brands, or individuals. The ones highlighted in media reports include .sucks, .porn, and .wtf. To prevent injunctions from being issued, website owners should exercise caution when using such domain endings.

.sucks – an annoying domain

‘This sucks’ is generally used to express discontent about a person or a circumstance. Many brand owners believe that this new TLD will be used predominantly for defamation and have tried to pip others to the post through defensive registrations. Similar behaviour has also been seen among celebrities. In 2015, for example, singer Taylor Swift took the precaution of reserving both the .sucks domain for her name as well as the corresponding .porn counterpart.

Vox Populi, the domain registry responsible for the .sucks domains, does not see any problems with the new TLD. The registry sees the ending rather as an opportunity for companies to enter into a dialogue with customers.

Why defensive registration is unnecessary

Domain endings like .sucks, .wtf, and .porn are only problematic when used in combination with brands or proper names. Although a site like www.monday.sucks is totally harmless, a site like www.brand-name.sucks could damage the brand’s trademark rights if the site is not operated by the brand itself.

A company doesn’t necessarily have to register the address themselves in order to protect the brand’s rights. ICANN has two efficient methods available for this, which are the Trademark Clearinghouse (TMCH) and Uniform Rapid Suspension (URS), which protect against unlawful domain registrations. The Trademark Clearinghouse serves as a central register where brands can be recorded. If a new top-level or second-level domain is proposed that matches an existing data set in the register, the appropriate brand owner will be notified. Brand owners can have internet addresses suspended via the uniform rapid suspension if someone tries to register a similar domain or misuses the registration process.

Tip

New top-level domains, generic endings, country code TLD? And what’s the deal with second- and third-level domains? We have all the information about the different domain types elsewhere in the Digital Guide!