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Comments on Guidebook

  • To: <gtld-guide@xxxxxxxxx>
  • Subject: Comments on Guidebook
  • From: "Brian Hedquist" <Bhedquist@xxxxxxxxxxxxxxx>
  • Date: Mon, 15 Dec 2008 12:03:45 -0500

After close review the proposed application guidelines and consultation
with our own subject matter, fraud and legal experts, Cyveillance
believes these new gTLD options and the acquisition process pose no real
benefits to our clients or their customers and, in reality, would expose
them to significant online risks, serious loss of brand equity and will
undermine online consumer confidence worldwide.


As ICANN moves forward toward implementation and outlining their
processes and procedures, it is readily apparent to Cyveillance that
there are serious and dangerous flaws the approach. Close scrutiny of
the proposed procedures reveal:

1)      little to no protection for global trademark holders; 

2)      excessive administrative costs for applicants; 

3)      virtual total control by ICANN with no accountability; 

4)      exposure to increased fraud and legal liabilities for brand
owner; and,

5)      easy access and control for unscrupulous entities to core
Internet infrastructure components and ultimately threatens Internet
commerce around the globe.


The following are the major concerns Cyveillance has with the proposed
implementation of the ICANN policy:


*       The gTLD application fee will be $185,000.00 for a single gTLD
and it must be acknowledged that it is only "to obtain consideration" of
an application and offers no guarantee that the application would be
granted (the cost of registering a "dot com" domain is approximately
$20). Given that there are currently over 180 million .com domains the
total potential revenue to ICANN could be in the trillions of dollars.
If only the Global 2000 applied, the administration cost alone (using
ICANN's own estimates) would be $370 Billion. Note that this estimate
would only cover their corporate name and not their individual brand
names and no other variation of the brand in order to protect them from
cybersquatting or typopiracy.
*       The proposed gTLD guidebook provides that any community-based
applications will take priority in the proposed application process.
Enterprises and companies would have little recourse in acquiring gTLDs
containing their own company or brand names.  For example, if the
International Brotherhood of Magicians (http://www.magician.org
<http://www.magician.org/> ) wanted to register ".IBM" according to the
proposed procedures, they would potentially have priority over ".IBM",
not IBM Corporation. This outcome would not only cause market confusion
but would lay the foundation for potential fraud targeting consumers


*       If no community-based applications are presented other
enterprises competing for a gTLD could be determined either between the
competing parties or through an auction process (the one with the most
money offered wins). There is no guarantee that the most appropriate
trademark owner would retain a gTLD containing their brand name.
*       When objections arise, ICANN has devised a process whereby any
dispute will be decided by a single arbitrator appointed by WIPO (World
Intellectual Property Organization) with preference given to the
community-based applicant.  There is a very serious potential legal
problem by giving ultimate decision making authority to a single
arbitration panelist appointed by an outside body. A process called
"DRSP" (Dispute Resolution Service Provider) - a new form of a UDRP
(Uniform Domain-Name Dispute-Resolution Policy, formed by ICANN) - can
be filed and ICANN will appoint a single arbitration panelist to make
the final determination. 
        However, the arbitration panelist decision will be final and
will require all applicants to waive all legal rights including the
right to bring suit to overturn arbitrary or groundless decisions by a
panelist. These arbitration decisions have the force of law and cannot
be appealed.  ICANN would have complete authority and brand owners would
have little or nor ability to object. It also puts ICANN in the position
of being an international governmental body - executive, legislative and
judicial, all wrapped up in one. 
*       Also, ICANN is considering registry-registrar cross ownership.
For instance a large corporation like IBM could select a company to
manage their .IBM gTLD and they would act as manager of the domain (both
registrar and registry).  This could be easily exploited by fraudsters
and criminal syndicates that could control the Registry/Registrar/ISP
chain thereby making it nearly impossible to take a fraudulent site down
or provide little recourse to the affected company.
*       There are no mechanisms in place to ensure that a company
awarded the registry/registrar application will have the resources
(knowledge, technology and capital) to ensure the reliability and
availability of the gTLD. For example Registry standards require six
9's. i.e. 99.9999% reliability, availability etc. This could easily
degrade performance and accessibility of all sites falling under certain
new gTLD. The result could affect both the performance and security of
not only a web site but email, applications and all infrastructures
related to the new gTLD.


*       The potential for fraud is unlimited - organized criminal
entities would have an equal opportunity to apply for these domains
throughout this process. It will be even more difficult for companies to
protect their customers from fraud through the use of their brand or
become the victims of extortion by those who would hold the gTLD (with
their legal trademark) for ransom. It will create an unprecedented
confusion in the consumer market where a consumer will be unable to
distinguish which is the VALID Domain: IBM.com/Sales or Sales.IBM.


*       Many large companies spend millions of dollars to manage their
registered domains. As a defensive tactic, these companies have
purchased hundreds and possibly thousands of domains, mostly to simply
protect their trademarks and brands.  This new ICANN policy will not
eliminate the need for defensive registrations as some have claimed, but
will actually increase the need, adding significant management time and
expense to fully protect their brand and their customers.


Cyveillance is not a registry or registrar and we do not receive any
direct benefit regardless of the success or failure of this new policy.
At Cyveillance our highest priority is to protect our clients and brands
from online threats. 


Corporations and their brands will always need protection from
unauthorized use, and therefore we will continue to work on our clients'
behalf to patrol the open source Internet as it continues to evolve. We
believe that this new ICANN policy, once implemented, would have the
potential to be extremely damaging and ultimately irreversible.   


Kind regards,



Brian Hedquist

Cyveillance, Inc.


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