The Issue
The Internet Corporation for Assigned Names and Numbers (ICANN) is a nonprofit organization responsible for coordinating the technical management of the internet’s domain name system and for ensuring its continued security, stability, and integrity under a contract with the National Telecommunications and Information Administration (NTIA), an agency within the U.S. Department of Commerce (DOC).

ICANN launched a new program in January 2012 that will significantly expand the list of permitted top-level domain designations (words that appear to the right of the “dot” in an internet address).

• Applicants will be allowed to claim virtually any word, generic or branded, as an internet top-level domain (TLD).

• This potentially includes: .charity, .donate, .nonprofit – and maybe even “branded” names, such as Independent Sector

• Currently, 22 top-level domains are permitted (e.g. .com, .net, .gov). ICANN estimates that this number will grow by the hundreds before the program goes live in 2013.
  

Anatomy of an Internet Address

LATEST NEWS

ICANN announced May 1, 2012, that it the initial rollout of proposed new TLDs would be delayed to late June due to technical processing issues.

In March 2012, the Department of Commerce announced that it rejected ICANN's  bid for a long-term contract to continue managing the TLD program and other critical internet functions citing that the ICANN proposal does not meet "the requirements requested by the global community." Instead, the NTIA granted ICANN a six-month extension on its current contract to manage the Internet's address and domain systems. NTIA said it would reissue its request for proposals, inviting ICANN and other applicants to re-apply. While NTIA has declined to comment due to rules that prohibit the agency from discussing pending contracts, outside groups view the long-term contract rejection as a “clear message to ICANN that it must seriously address concerns of its critics.”

TLD Expansion Concerns
A number of concerns have been raised by both nonprofit and for-profit organizations about costs and other burdens this new program could create. Since ICANN is paid directly from registration fees, it has a financial incentive to open up the registration process to as many potential new domain names as possible. This effectively places the burden on organizations to prevent fraud by purchasing rights to any and all variations on their legitimate domain name. Many express concern that ICANN does not adequately police its existing registries to help control fraud, and the expansion will exacerbate that concern.

• In order to protect their brands and minimize fraud, organizations may feel compelled to register their names (and alternate spellings) under many more domains, incurring significant additional costs for no additional benefit. For example, an organization may need to purchase second-level domains (words immediately to the left of the “dot”) for a variety of new first level domains to prevent fraudulent use (i.e., registering, www.independentsector.donate, www.independentsector.charity, or www.independentsector.nonprofit). Second level domain registration costs vary, depending on the prices set by the top-level domain operators, but currently range from $15 per year to as much as $300 for an initial registration.

• Further, organizations may feel the need to register their own name as a top-level domain name (to the right of the “dot”) in order to protect it. The initial registration alone is projected to cost $185,000.

• Even if organizations choose not to incur the additional costs of registering new domain names to protect their brand, they will likely incur additional staffing/cost burdens to more closely monitor web activity.

• To the extent that the expansion of domain names facilitates fraud through unauthorized and illegitimate online fundraising schemes, there is significant potential to erode donor trust in online campaigns.

Following a series of hearings and outside inquiries a number of congressional and public officials have written letters to ICANN leadership and the Department of Commerce, urging ICANN to delay the implementation of the new TLD program until serious questions are addressed.

• Senate Commerce Committee Chairman Jay Rockefeller (D-WV) letter
• Reps. Bob Goodlatte (R-VA) and Howard Berman (D-CA) letter
• Sens. Amy Klobuchar (D-MN) and Kelly Ayotte (R-NH) letter
• Larry Strickling, administrator of the National Telecommunications and Information Administration (NTIA) letter
• FTC letter

ICANN TLD Projected Implementation Deadline (Subject to Change)

Not-for-Profit Operational Concerns Constituency (NPOC)
The Not-for-Profit Operational Concerns Constituency (NPOC) is an advisory group created to engage the ICANN community on how proposed and existing policies and initiatives may uniquely impact the operations of nonprofit organizations and the delivery of their mission-related services.

Over the past year, NPOC and its members have submitted numerous policy comments to ICANN related to the top level domain expansion issue.

NPOC membership is open to nonprofit and non-governmental organizations including philanthropic, humanitarian, educational, academic and professional development, religious, community associations, promotion of the arts, public interest policy advocacy, health-related services and social inclusion.

Support for Expansion
Supporters of the TLD expansion, however, note that the process to obtain a TLD contains safeguards to prevent abuse of the TLD system:

• Only established corporations, organizations and institutions are eligible to apply for a new TLD. Individuals are not eligible.

• The $185,000 application fee makes speculation in TLDs expensive.

• As part of the application approval process, ICANN has established a formal objection process for trademark holders and other potentially aggrieved parties. Following the close of the application window in April 2012, formal objections can be filed on one of four grounds:

• The new TLD causes “string confusion,” meaning multiple entities have applied for TLDs so similar they could confuse end users;

• The new TLD name infringes on legal rights of trademark holders;

• The new TLD violates principles of international law;

• Or the new TLD misappropriates a “community label” such as a city or state name.

• Finally, because the addition of new TLDs also brings the potential for second-level domain registration issues, ICANN requires a “sunrise period” during which holders of trademarks can register early to reserve their domain name in the new TLD.

• In the event that a rights holder misses the sunrise window, there are also several dispute resolution procedures to protect the rights of intellectual property holders.