Senators, critics question ICANN's generic TLD plan

Groups complain that the January rollout will lead to trademark infringement

The Internet Corporation for Assigned Names and Numbers (ICANN) may be moving forward too fast on a plan to sell hundreds of new generic top-level domains starting early next year, several U.S. senators said Thursday.

Members of the U.S. Senate Commerce, Science and Transportation Committee, along with representatives of the Young Men's Christian Association (YMCA) of the U.S. and the Association of National Advertisers raised concerns about the plan to sell new gTLDs such as .hotel or .baseball.

The ICANN plan will force businesses and nonprofit organizations to spend significant money to register domain names on the new gTLDs in an effort to protect their brands, said Angela Williams, the YMCA's senior vice president. The plan would increase consumer confusion by allowing companies that don't own trademarks to set up websites that sell counterfeit products to consumers, she said during a hearing.

ICANN's plan will "impose severe hardship and burdens" on nonprofit groups, Williams said. "The new gTLD program compromises use of the Internet by increasing the risk of fraud, cybersquatting and trademark infringement and by significantly escalating the cost of protecting against such activities."

After a drawn-out debate about offering to sell new gTLDs, ICANN in June announced a plan to begin the process on Jan. 12. New gTLDs would cost about $185,000 for most organizations.

But entrepreneur Esther Dyson, the founding chairwoman of ICANN, questioned the plan at Thursday's hearing, saying it will lead to consumer confusion. If Marriott.hotel and Marriott.com were the same site, they would be redundant, and if they are different, "it's simply confusing," she said.

The plan creates "a profusion of new things to protect, without creating additional value because there remains only one Marriott," she said.

Kurt Pritz, ICANN's senior vice president for stakeholder relations, defended the plan, saying the organization has worked with intellectual property experts to put extensive processes in place to protect trademarks. Five economic studies on the gTLD plan have been published, and ICANN has conducted 47 public comment periods on the proposal, he said.

Trademark protections include a rapid suspension process for taking down infringing domain names, a trademark clearinghouse that will allow trademark holders to protect their brands on all new TLDs, and a new dispute procedure after a domain name has been sold, he said. ICANN also will check applicants for new gTLDs for histories of criminal behavior and cybersquatting, he said.

"Now is the time for launching the program," Pritz said. "It is the proceed of well-thought-out, thoroughly debated polices that are designed to benefit the billions of Internet users through increased competition, choice and innovation."

The new domains will create competition in the domain-name market and will mitigate the market power of the current TLDs, including .com, he said.

The Senate hearing came a day after Jon Leibowitz, the chairman of the U.S. Federal Trade Commission, called the ICANN plan a "disaster" for consumers and businesses.

Senator John "Jay" Rockefeller, a West Virginia Democrat and committee chairman, said the new gTLDs may spur competition and innovation on the Internet, but he urged ICANN to address lingering concerns.

"If ICANN is determined to move forward, it should do so slowly and cautiously," he said. "The potential for fraud, consumer confusion, and cybersquatting is massive and argues for a phased-in implementation."

Sen. Kelly Ayotte (R-N.H.) agreed. ICANN should implement 12 antifraud recommendations by law enforcement groups before moving forward, she said.

ICANN is negotiating with existing registrars to implement the recommendations, Pritz said.

"When I hear negotiations are ongoing for something that's a January rollout, that leaps out at me to say, 'Why are we rushing into this?'" Ayotte said. "It seems to me that caution should be used."

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is grant_gross@idg.com.

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