New Web address endings could be start of turf wars

A sea change may be coming to cyberspace with Web addresses ending in anything from .a to .z. That has businesses increasingly worried they will have to spend millions to guard their brand names.

The familiar .com, .net, .org and 18 other suffixes — officially "generic top-level domains" — could be joined by a seemingly endless stream of new ones next year under a landmark change approved last summer by the Internet Corp. for Assigned Names and Numbers, the entity that oversees the Web's address system.

Tourists might find information about the Liberty Bell, for example, at a site ending in .philly. A rapper might apply for a Web address ending in .hiphop.

"Whatever is open to the imagination can be applied for," says Paul Levins, ICANN's vice president of corporate affairs. "It could translate into one of the largest marketing and branding opportunities in history."

Many businesses see more problems than profits — opportunities for scammers to exploit brand names and mislead consumers, or even attack brands.

"It costs companies hundreds of thousands of dollars, if not millions, to enforce their trademark rights in the existing space, so imagine how expensive it will be when Verizon gets infringed in a thousand new domains," says Sarah Deutsch, vice president and associate general counsel for Verizon. "Many businesses feel this is a form of extortion."

To beat a competitor to the punch, a company might decide it needs to control a new generic domain, such as .cereal or .detergent, but it would be costly. The currently proposed application fee is $185,000, says Levins, plus an annual "continuance" fee of $25,000. If more than one company wants a suffix, there could be a bidding war.

A more likely scenario would be for a business just to register site Web addresses pairing their brand name with any new extensions, such as fios.telephone or gillette.razor. But even that defense could cost marketers up to $1.5 billion, estimates the not-for-profit Coalition Against Domain Name Abuse.

Many businesses already do that, usually then redirecting users from, say "product".net to the product's primary website ending in .com. More generic domains will add to that cost.

Companies will "do it more out of competitive necessity than any real desire or ability to meet consumer needs or improve their business, and that's a bad reason," says Peter Fader, professor of marketing at the University of Pennsylvania's Wharton School. "I would bet a large number of registrations would be purely that — people carving out turf they don't want other people to have, but not necessarily turf they can do anything good with."

The turf war could be endless, says Dan Jaffe, executive vice president of the Association of National Advertisers trade group of big marketers. "Think about some of the companies out there. Some have hundreds, maybe thousands of brands. ... It's really open-ended."

Levins says ICANN is still taking comments on rules to protect trademarks, secure the Web and solidify a process to challenge new extensions as offensive.

ICANN won't take new generic domain applications "until we've addressed those concerns," he says, adding that the earliest would be the end of this year.

While some fret about new, more specific generic domains, others see opportunity.

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