Posted by Jeff Ernst on October 25, 2011
My colleague Chris Stutzman reports from the 2011 ANA Masters of Marketing conference that Association of National Advertisers (ANA) CEO Bob Liodice used his keynote presentation to continue to hammer ICANN's generic top-level domain (gTLD) initiative. Maybe he should listen to Dana Anderson, SVP at Kraft Foods, who spoke about how "lasting change happens in leaps and bounds, not through incremental shifts."
I've been advising companies since ICANN's announcement in June on how to evaluate the .brand or .category opportunity, and most of those companies haven't found a bona fide new business opportunity that justifies the investment in a gTLD. But with few exceptions, they're looking at ICANN's plans as one of the biggest opportunities since the dawn of the Internet to take more control of their brand online, which is why the ANA argument troubles me.
The heart of the ANA’s arguments come down to claims that it will cost brands billions of dollars in defensive registrations to protect their trademarks from cybersquatters and other web perpetrators of all sorts. But let's dig into that a little deeper:
- Will it be billions of dollars? I have yet to see ANA produce any data to support its claims that the costs will be staggering.
- Will there be squatters on your .brand gTLD? If you are a brand owner with any IP rights to your brand, there’s no way a perpetrator will win an application for your .brand TLD. Even if one could, no squatter will spend $185,000 on it.
- Will there be squatters on secondary domains within new gTLDs? There are not just two dozen TLDs today; there are also a few-hundred country code TLDs (ccTLDs). If brand owners don’t see the need to spend money today on defensive registrations on all 22 gTLDs and on every one of the hundreds of ccTLDs, then why will they see the need to do a defensive registration on someone else’s new gTLD?
- Organizations that are applying for gTLDs must explain in excruciating detail what they plan to do with the gTLD (i.e., what business initiatives they will create), and they have to establish and enforce policies for who gets into and who gets taken out of their registries.
- Not all gTLD operators plan to sell secondary domains to the public, but those that do will be municipals (.london) and categories for communities, industries, hobbies, etc. (.golf). To what extent will Coca-Cola be harmed if someone buys and squats on coke.golf or coke.london, when consumers come to learn that the only authentic Coke web properties end in .coke? If Coke decides to sponsor the PGA tour, it would more likely build a site at pga.coke.
gTLDs aren't for every organization, but if we're going to make claims about billions of dollars in expenses for brand owners, let's show the math.