To gTLD or to Not gTLD?

December 5, 2011

"Who Should Invest in a dotBRAND?" Video WebinarIf you haven’t already heard, there’s a new word in town. It’s called “dotBrand” and it’s about to crack the dotcom world wide open.

In January 2012, the Internet Corporation for Assigned Names and Numbers (ICANN), the non-profit organization that governs the internet’s naming system, is opening the opportunity for global businesses, communities, governments, and even geographical locations, to apply for generic top-level domain names (gTLDs)—such as .canon, .wine, and .nyc. Many are now weighing the pros and cons of “dotBranding” themselves.

The news surrounding ICANN’s new gTLD program, has stimulated a broad discussion raising questions such as “How could my business benefit from this?” to “Do I need to protect my brand?”

Like all things, there are a wide range of considerations to factor in when deciding whether to apply, among them trademark protection, brand equity, and cost. To help business leaders evaluate the benefits of investing in a gTLD, Columbia Business School’s Center on Global Brand Leadership hosted a video webinar, “Who Should Invest in a dotBrand?” this fall. The event brought together branding and internet experts to discuss the strategic questions decision-makers are facing. To view this free webinar, click here.

First, it should be clarified that ICANN isn’t simply handing out gTLDs to the first person or organization that applies. Just because Jane in Arizona is applying for .madonna doesn’t mean that she’ll get it. There are “checks and balances” in place including a trademark clearinghouse providing authentication of trademark information, and an objection-based process enabling rights holders to demonstrate that a proposed gTLD would infringe their legal rights. Of course there are valid concerns for businesses, organizations, and communities who do have common or even similar names. A company like Patagonia may be legitimately concerned about securing the same domain name as the region of Patagonia. ICANN has created a dispute resolution program, and even auction procedures, to handle such issues.

While some brands perceive gTLDs as a risk and may be considering applying for trademark protection, others envision possibilities involving brand extension and brand architecture. For example, a parent company like Unilever with multiple sub-brands could employ “dove.unilever.” B2C businesses like Citibank could create a more personalized consumer experience through their websites with url’s such as “www.michael.citibank.” But this also begs the question about the appearance of a brand’s homepage—is it “home.bmw” or “bmw.bmw”? Brand consultants seem to still be hashing this out.

And many opponents to the new gTLD program feel the financial commitment is a hefty price to pay for a top-level domain system that they feel works fine with its 22 existing TLDs (.com, .gov, .jobs, etc.). The application costs US$185,000 as well as a reported US$25,000 annual fee. Then there are the additional expenses such as technical, administration, and maintenance fees. For big name brands, this could be worth the investment. When compared to the cost of a single, 30-second television spot, it’s not a huge chunk of change. For small to mid-size companies, however, it is an expensive endeavor that may take deeper consideration.

“The kinds of benefits we see from a brand-building perspective are things like controlling your brand and your content,” explained Karl Isaac, Executive Director of Landor’s digital branding practice, during the Center’s webinar. “If you are a business that transacts with your customers or that protects very private and confidential information for your customer, the increased security benefits alone may outweigh the risks of doing this.”

The application process may be preempted, however, as the U.S. Senate Committee on Commerce, Science, and Transportation has called for a hearing this month to discuss the merits, implications and concerns surrounding ICANN’s new program. If the gTLD application process does move forward as planned, businesses and organizations will need to do due diligence if thinking about applying.

BY ALLIE ABODEELY

One Response to “To gTLD or to Not gTLD?”

  1. Rick Noel Says:

    Nice post Allie. I am really excited to see how the gTLD “domain rush” and subsequent implementation plays out. It will take well-funded organizations to be able make it through the application process. The funding requirements are higher than the application fee as operational zing a TLD registry will drive the total cost of ownership to some multiple of the application fee, to say nothing of supporting challenges for a gTLD multiple parties are applying to. Those with funds to invest have the opportunity to can create long term competitive advantages for the most sought after gTLD given how long it will take to wait for the second round of applications. I attended the webinar hosted by the The Center on Global Brand Leadership last fall and you delivered a truly awesome expert panel discussion many aspects of the gTLD process, different types of applications, schedules with key application dates, potential value drivers and implementation considerations for potential applicants. The webinar hosted by your organization, IMHO, is a must-see for all brand leaders since the implications on this fast growing channel could be tremendous for both the gTLD soon-to-haves AND the gTLD have-nots. Also, waiting for the next opportunity to apply could be a long time if you miss the train at the station now! Thanks for sharing.


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