Companies, the rich and famous and regulators in Washington now are worried that the rush to defensively buy Web addresses will only worsen — and grow more costly — as the organization in charge of doling out real estate on the Internet prepares to unleash an infinite number of Web suffixes to add to the familiar .com, .net and .edu. Some experts say the move will change the landscape of the Internet forever.
In January, the Internet Corporation for Assigned Names and Numbers (ICANN), the nonprofit association tasked with managing the Internet’s addresses, known as domain names, will begin taking applications from anyone with $185,000 and a desire to reserve their own suffix on the Web. The group oversaw the launch of .xxx last week. Coming after ICANN’s review process could be .god, .abortion, .sex and .georgetown, as well as thousands of others.
ICANN, based in Marina del Rey, Calif., says that the new suffixes will promote innovation and it will make sure the Web addresses do not fall into the wrong hands. But lawmakers and regulators want ICANN to delay its process.
A hearing on the matter will be held Wednesday by a House Energy and Commerce subcommittee, though no legislation is planned at this time, committee spokeswoman Debbee Keller said.
Federal Trade Commission Chairman Jon Leibowitz said last week that implementing the program could be a “disaster” for consumers. Regulators are concerned that ICANN is not doing enough to prevent scam artists from setting up fake sites and confusing average people. The commission is preparing to send a letter to ICANN outlining its concerns about how consumers will be protected under the new registry, said a person familiar with the commission’s thinking who spoke on condition of anonymity because the letter is being drafted.
The U.S. government does not have direct oversight over decisions made by ICANN, which was created in the Clinton administration at the request of the Commerce Department as the Internet was taking off. Its creators resisted regulation because they wanted the Web to stay open.
The FTC, for instance, cannot reverse ICANN’s policies. It can only go after owners of the new suffixes if they engage in deceptive consumer practices — and if they operate in the United States.
The expansion of suffixes may also compel anyone with a brand name to buy multiple Web addresses to protect its image and prevent customers from being tricked by artfully misspelled sites. ICANN, for instance, handed over .xxx to ICM Registry, which has been charging $200 to trademark holders for each Web address they want to reserve.
The National Retail Federation, an industry trade group, has sent letters to Congress criticizing the rollout of the domain names for lacking transparency — and for the potential cost. Besides buying Web sites to prevent themselves from being associated with a .xxx or a .sex suffix, companies may have to fork over $185,000 to ICANN, plus legal fees, to control a suffix of their own. Plus they would have to maintain useless domains at a cost of $50,000 to $100,000 annually, the NRF said.
“It’s a little bit like the Oklahoma land rush,” said Mallory Duncan, NRF general counsel. “You come in now and pay a quarter of a million dollars or forever hold your peace. That’s not a prudent way to run a business.”
The Gap has said it would not only have to defend the names of its eponymous Gap stores, but also for its four other brands: Banana Republic, Old Navy, Athleta and Piperlime.
“ICANN’s domain-name expansion will require us to considerably increase our efforts and costs to monitor and police cybersquatting, counterfeiting, online fraud and phishing, thus diverting resources that could otherwise be used for job creation,” Toby Lenk, president of Gap Inc. Direct, wrote in a letter to Congress.
For ICANN officials, the calls from Washington to delay the process seem odd. ICANN has been working on the expansion for six years and has held more than 40 comment periods where thousands of copyright holders, computer scientists and businesses have weighed in.
ICANN spokesman Brad White said the organization has put protections in place to prevent the creation of deceptive Web sites, such as requiring those wanting to reserve suffixes to provide more contact information and submit to background checks. ICANN also is giving those with trademarks the right to reserve any suffix associated with their brand name.
“This has been a very long and inclusive process,” White said. “It’s simplistic criticism to say that because you will have more space, you will have more fraud.”