Phil Corwin, representing Internet Commerce Association, discusses threats to domain name owners.
Phil Corwin, representing Internet Commerce Association (ICA), addressed more than 50 domain name owners today at the SedoPro conference in New Paltz, New York. He warned that there are many threats to the value of domain names.
Corwin referenced Jimi Hendrix’ song “Castles Made of Sand”: Castles made of sand fall into the ocean eventually. Domain names are castles made of sand, and need to be reinforced with steel, says Corwin. He says the domain community needs to avoid the mess the private equity industry faces right now. Because of mainstream press attention, legislators have introduced a bill to tax private equity profits at a higher rate. The domain name industry is also in the press for the wealth it is creating, and this could get the attention of Washington. It’s too late to keep the industry out of the press, but it’s not too late to influence policy making.
He noted several of these specific threats to domain names:
1. Domain name classification as property versus a license. ICA wants domains to be classified as property, and says the domain industry should take the lead on getting this position solidified.
2. ICANN. Corwin notesd several threats to domainers because of ICANN. First, he believes ICANN is willing to sacrifice the domain industry’s interests for backroom deals, such as the VeriSign (NASDAQ: VRSN) settlement. Second, the variable pricing scheme that was floated during .org/.biz contract discussions could be a major threat. Third was how ICANN and the supporting registry discussed .xxx. ICA has no opinion on .xxx, other than that a registry’s role should be solely to run the registry, not to define what type of content can be included on a domain name. Fourth, Corwin reminded the crowd that Vint Cerf is leaving the board. A power struggle could ensue.
At the last ICANN meeting the staff was given a directive to research becoming a private international organization. Corwin says this is a way for ICANN to insulate itself from litigation. Corwin also says that ICANN only admits problems when they become to big to ignore (witness RegisterFly).
3. Registrar conflicts of interest. Many registrars are retaining the best expiring domain names, which creates a conflict of interest.
4. Trademark interests. Verizon is leading the charge to broadly define trademark infringement for domain names. The Coalition Against Domain Name Abuse, perhaps backed by large companies, is a new non-profit organization fighting for legislation against domain name owners.
5. Search engine conflicts of interest. Direct navigation competes with search engine usage. Search engines provide domains with revenue. How will this be reconciled? Corwin suggests using anti-trust laws against search engines.
Corwin concluded by saying the ICA’s future is uncertain. It raised about $300,000 in seed money from companies such as Sedo and iREIT, but Corwin says it needs at least $1M each year to be effective.