Lining up for a domain showdown

Australia's largest domain registration companies, including Melbourne IT and ARI Registry Services, could be about to make a lot of money out of web conflict thanks to the internet real estate grab that new generic top level domains will bring.

The Internet Corporation for Assigned Names Numbers (ICANN) has been working on a scheme since 2005 which will allow companies or communities to register and manage domains such as .camera, .beer, .apple or .bank.

The application period for registrations opens this Thursday, and closes on April 12, at which time we'll know which companies have staked their claim to a new domain. For now everyone is keeping their cards close to their chest.

Those in the industry are expecting between 1,000 and 1,500 global applicants, but it's not until we know which organisations they are that it will get interesting

“Contention management” is what Melbourne IT chief Theo Hnarakis calls the particular part of his business that will deal with defensive applications, and objections to existing applications that customers feel infringe on their business.

The new generic top level domains will essentially allow a company wanting more control over how its identity is used on the internet to become its own registry, preventing the selling of second or third level domains using its brand. It's a no-brainer for the banking industry, for example, which can use the opportunity to help stamp out phishing attacks on .com domains.

But for competitive terms such as .football, .poker or .beer, it gets a lot murkier.

“It could take a couple of years for these contentious names to get up,” says Hnarakis.

“Contention management, as we call it, will be a significant opportunity for us where we'll both manage customers that have applied for their names but also customers that have not, but want to defend or object to other applications they see as infringing.”

US Federal Trade Commission chairman Jon Leibowitz has told a congressional committee the Commission is very concerned the rollout of new gTLDs has the potential to be a disaster for consumers and businesses.

"Businesses will have to defensively register all of their names," Leibowitz says. "Our sense is it's burdensome to businesses. We see enormous cost here to consumers and businesses and not a lot of benefit."

Hnarakis says he can understand the concerns of those groups flagging problems with the scheme.

“I think some of their fears are well founded around the cost of defensive registration and the confusion that will occur…but I also think…there's terrific opportunities that will emerge from this.”

Nevertheless Hnarakis admits around half of all the applications Melbourne IT has processed have been for defensive purposes. “Not defensive purposes so that no one else can get it, more to keep their powder dry and watch and see what others are doing.”

Melbourne IT has managed about 100 applications so far, 20 of those from Australian companies, but Hnarakis is expecting this to grow to between 150 and 200 by the end of the application period, with around 40 coming from Australian firms. The finance, media and technology sector are providing most of the business.

It's a similar story at privately owned group AR Registry Services which says finance, IT, sports, media and cities make up the majority of the 150 potential applicants it says it's working with.

Melbourne IT shares closed flat at $1.60 yesterday, after slipping more than 1.5 per cent, against a benchmark index rise of 1.13 per cent, suggesting the market was expecting the company to have secured more clients for the scheme by now.

Canon, Deloitte and IBM are among the major brands to have confirmed their application, and you can monitor the other applications made so far on a growing number of sites, including newtlds.tv.

With the cut-off period for applications getting closer it seems many are still sitting on the fence, waiting to see what happens.