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International - How the '.xxx' registry is wooing brand owners

By Adam Smith
July 18 2011

ICM Registry is apparently doing all it can to seduce brand owners into its Sunrise B trademark protection programme for the ‘.xxx’ top-level domain (TLD). Although many brand owners are very uncomfortable with the idea of connecting their trademarks with ICM’s approaching TLD, it might be their best option in the long run. ICM certainly thinks so: today it announced that the sunrise will run far longer than originally planned, in order to scoop up as many trademarks as possible.

Sunrise B was scheduled to last for only 30 days. It will now run for 50 days from September 7, finishing on October 28. Under the scheme, a brand owner’s eligible trademark terms will act as blocks to the brand in the ‘.xxx’ space. If ‘.xxx’ is to exist, one cannot criticise ICM for not bending over backwards in order to minimise its impact on brands. After speaking with trademark and domain name experts, ICM wrote a white paper to outline its plans for brands – and then travelled to the INTA meeting in San Francisco in May to launch it. To ensure its message is heard by brand managers, the company is preparing to roll out extensive advertising in relevant channels (including WTR). Last week, ICM’s chief executive Stuart Lawley gave WTR a frank interview, in which he revealed the wholesale fee for the Sunrise B – opening up the fee structures of registrars.

Of course, there are plenty of trademark owners who disapprove of ICM’s plans. Critics object to their having to pay up to $300 per trademark to block their terms from a space that has nothing to do with their business and which, for many, they would rather did not exist. Sources report that several brand owners have threatened litigation against ICM. As Fred Felman, MarkMonitor’s chief marketing officer, notes, “Sadly there are very few ideal venues for brands in the online world, so the burden of brand protection falls solidly on the brand owner themselves almost everywhere in the Internet, including ‘.xxx’.” So does this put corporate registrars such as MarkMonitor in an awkward position? Not according to Felman, who explains: “We tend to be very factual about gTLD offerings and not try to influence participation one way or another with any bias. However, we do work with each client individually to evaluate the risk they might face in any new gTLD considering where their marks have been contended in various venues, risk of confusion, brand tarnishment, against any possible positive factors, such as, whether the TLD could be interesting from a promotional perspective, drive traffic, or revenue.”

Felman adds that ICM has been “creative” in its approach to brand protection – a freedom that will be enjoyed by no future registry now that the new gTLD programme is approved. Lawley said today: “We wanted to take an innovative approach to the launch of ‘.xxx’ and show best practice at all stages including investing in a global awareness campaign. ICM Registry believes in consumer choice, and while we believe the ‘.xxx’ will satisfy the needs of the sponsored community, we recognise there is also an audience who would like to opt-out and safeguard their intellectual property prior to the domain going live.”

Last week, Lawley promised that brand owners would be able to examine details of the post-launch rights protection mechanisms available before deciding whether to block their terms through Sunrise B. While ICM is still yet to publish the full details, it has announced that the fees for its rapid takedown service and dispute resolution policy will be “approximately $750 to $1,500”.

Those brand owners who decide to participate in Sunrise B will be hoping to avoid those later costs, although Sunrise B itself is not without its challenges. Trademark rights still have to be validated during the submission process, and applicants will not be able to correct errors after submission. Hopping into this niche is Trademark Fact Check, a new service from former executives of Thomson Reuters and NetNames. According to a statement sent by the fledgling outfit to WTR: “Trademark Fact Check provides automated fact checking technology that mirrors the validation checks performed for the ‘.xxx’ sunrise. It determines eligibility and detects conflicts between government trademark offices and ‘.xxx’ sunrise applications before fees are incurred…For the first time, automated fact checking is available to trademark owners before submitting sunrise applications. Our innovative trademark searching technology streamlines the sunrise submission process, reduces application errors and thereby, minimises the costs associated with protecting trademarks in the ‘.xxx’ TLD.”

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