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Should You Change Your Top Level Domain Strategy?

A generic Top Level Domain or gTLD is an internet extension such as .com or .edu. There are currently about 25 gTLDs in use today but with the expansion of the new program there could be an endless number of gTLD.

The creation of generic top-level will promote competition and expand the number of top-level domains. The most intriguing piece to the new gTLD program is the opportunity to apply for custom gTLDs specific to an organization or industry. Obtaining a top level domain is going to be more involved than procuring a domain from godaddy.com. In fact obtaining a gTLD could be very involved. For this reason it will be important to review your company’s domain strategy before the application process begins.

Applications for the new gTLDs will be accepted beginning January 12, 2012 running through April 2012. A second round of application dates has not yet been specified. The application process begins with the completion of a formal application with ICANN (Internet Corporation for Assigned Names and Numbers) including a background screening of general business diligence (including criminal history) and history of cybersquatting behavior. Publicly traded corporations, on any one of the 25 open markets, will be deemed to have passed the general business diligence requirement. The application process then will follow a series of evaluations, dispute resolutions and then a final approval before the gTLD will be live.

The initial evaluation from the ICANN committee is to be completed five months from when applications are submitted (presumed to be January of 2012). The initial batch of approved initial evaluations will be limited to 500 to manage the time and capacity of the extended evaluation, string contention and other disputes. This phase in the process may prove to be a bottleneck given the possibility for disputes and number of applications.

ICANN has not only created a thorough application and review process which may not encourage lots of people to apply; the pricing structure which may also dissuade applicants from applying en masse. Each application for a gTLD costs $185,000 including a $5,000 deposit which will be applied to the application fee. In some cases additional fees may be required. This high-cost structure may keep applicants from creating what ICANN deems unnecessary gTLDs.

It will be interesting to see how large brands approach this opportunity and restructure their domain strategy. Will they attempt to purchase branded gTLDs? For instance would Nike try to obtain .nike so they can build sites like shoes.nike, runningshoes.nike or footballshoes.nike? What will be the advantage? Will it be worth the investment? Will they make it through the application process?

The thorough application process and concern over gTLD squatting may mitigate the rush to apply in the first round; however, the novelty of owning a branded gTLD may just be too much to ignore and entice large numbers of applications.

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