New top-level web domains will shortly be available, but it is up to companies to act quickly to secure their desired domain, warns Nick Wenban-Smith

In June 2008 the Internet Corporation for Assigned Names and Numbers (ICANN) announced a process for applying for new generic top-level domains (gTLDs). A TLD is the last part of an internet domain name; that is, the letters that follow the final dot of any domain name, including .uk, .com, .net and .org.

Alongside the TLDs we have all grown familiar with, consumers and businesses will need to be aware of potentially hundreds of new suffixes. Law firms will need to be up to speed with the applications process for and the implications of the new gTLDs before this raft of new domains is introduced. Companies may well need to adapt their clients' domain name strategies in order to protect their online brands from being compromised or diluted by opportunists wishing to profit from making speculative registrations.

Impact of new gTLDs

The application process for launching the new gTLDs is still under discussion and is scheduled to be finalised towards the end of 2009/early 2010. It is expected that there will be distinct purposes for these new gTLDs, including the following:

• generic domains, such as .com, .net and .org;
• brand-specific domains registered by large corporations to ringfence their online identity with their own .brand domain;
• domains for specific sectors of business, such as the existing .travel and .aero; and
• geographic domains for regional names that cannot be applied for through the country code TLD process, such as .cat for Catalan-speaking communities.

To prepare for this change, businesses will need to ensure that their domain name strategy is robust and tailored to cope with the impact of these new gTLDs.

Companies need to decide whether or not they are interested in registering their .brand, which would require significant investment in both financial and resource terms.

They also need to decide whether they are interested in registering their company's trademarks across all the different new gTLDs as a preventative measure or whether they would rather wait to see whether their trademark is infringed.

If the chosen route is to register the brand defensively, it is vital to be aware of the launch dates for the relevant new gTLDs to ensure that the brand is not registered by someone else first. It is equally important to be aware of the renewal dates of all domain names to prevent them expiring and falling into the hands of someone who chooses to register, sell or use a domain name with the sole purpose of profiting from that brand's trademark.

With a large number of potential new gTLDs there exists significant potential for opportunists to profit from registering domains that infringe on other companies' brands, given the nature of overlapping names and trademarks.

The launch of a new TLD generally follows a pattern. First, there is a 'sunrise' period, which allows trademark owners to purchase their domain name. Next, there is a 'land rush' period, when anyone can purchase any domain name for a higher fee. At this point, brands that have not registered their domain name in the sunrise period can miss out to other parties, and may have to pay an even higher price to reclaim the domain. Finally, the registry is opened to all for a regular price.

The introduction of new gTLDs will have an impact on the way businesses and consumers navigate through the web. It is likely that users will trust some domain names over others – recent research in 2008 in the UK found that consumers trusted .uk domains over other suffixes. Businesses will need to ensure that they have registered the right domain names to be certain that when looking for their services, customers find their site and not that of a competitor or someone who has registered the company's domain name to profit from
their trademark.

Where are we now?

ICANN has recently launched the second version of its guidebook for applicants for new gTLDs. It is hoped that the guidebook will be finalised and the application process opened before the end of 2009. However, this will be a long process, and we will not start seeing new TLDs for some time. Nor will all of the new TLDs be launched at once – each TLD will determine their own timescale for their launch.

It is also possible for companies to appeal against the new TLDs as part of ICANN's process. Once the applications have closed, ICANN will publish a list of new TLDs that have been applied for. For example, if someone has applied to run .companybrand, and the company feels that this is an infringement on their trademark or will be used abusively, there is an opportunity to appeal the application. If their appeal is upheld, the application to run that gTLD will be unsuccessful.

To dispute or not to dispute?

For those companies that have already had their domain hijacked, there are a number of options available, such as pursuing litigation through the courts or via dispute resolution services.

The time and monetary investment required for protection means that small businesses are effectively disenfranchised from the court system. Dispute resolution services are a viable alternative as they are a cost-effective and efficient method of dealing with domain name disputes. There are various online dispute resolution policies available to UK businesses.

What next?

The application to run a registry has not yet opened, so it is difficult to predict how many applications there will be. What is clear is the new domains will have an impact on the domain industry and, by implication, online brand protection.

How companies respond to the proliferation of new TLDs will depend on their strategy for managing domains, and this may need to be revised in preparation for the launch. Cost will be an important factor – defensively registering in every suffix could be a major investment.

In the current economic environment, many organisations may take a more pragmatic view and only register the most relevant domain names in order to save costs.

However, if a company does not defensively register related domain names, it could be faced with a further problem of brand infringement disputes. If these go to court they can become costly and time-consuming.

Now is the time to start planning for this potential proliferation of names and to ensure that companies have their house in order before it all starts.

Nick Wenban-Smith is senior legal counsel at Nominet.