Internet land rush or job security for ICANN!

Mon, 7th February 2011, 18:58

For many, the hassles associated with registering a domain is limited to finding a suitable name that has not been registered by some domain squatter hoping to make a few dollars. For others, such as e-commerce and businesses types functioning in a global economy, ensuring that other firms do not profit from your earned goodwill or from a potential clients mistaken identity is no same feat. With over 21 generic domains such as .com, .net., .edu or .org and hundreds of others for countries, the cost of domain registration has become a major capital expenditure. And it is about to get infinitely more expensive!

The Washington Post has a interesting piece on the coming massive expansion to the Internet's domain name system. The mundane and ordinary dot com domain extension is about to face vast new competition that will dramatically transform the Web as we know it. New Web sites, with more subject-specific, sometimes controversial suffixes such as .eco, .love, .god, .sport, .gay or .kurd.

While it has not been decided (at least publicly) who is going to get .amazon - the Internet retailer or Brazil, with a price tag to apply at $185,000, the cost ensures only well heeled organizations will be seriously applying to operate the domains. That's on top of the $25,000 annual fee domain operators have to pay ICANN.

Many organizations are competing for the same domain names extensions, in disputes that often will be settled by an ICANN-sponsored auction or by an ICANN board decision. Two companies vying for the environmentally-friendly .eco domain have competing endorsements: one from a nonprofit chaired by former vice president Al Gore; the other from a group founded by former Soviet Union president Mikhail Gorbachev. And the stakes are high. The successful organization could potentially sell hundreds of thousands of dot eco web addresses for wholesale prices to domain registrars, which would then market the extensions to consumers for higher prices.

While there are mechanisms in place to gain control of a domain once it has been registered by someone else, the procedure is time consuming and has some inherent risk. Many firms chose to mitigate the likelihood by procuring the domains when they are available. Fail safe, but costly! 

This week, hundreds of investors, consultants and entrepreneurs are expected to converge in San Francisco for the first ".nxt" conference, a three-day affair featuring seminars on ICANN's complicated application guidelines.