Alternate Domain Providers Show the Way: But ICANN’s Not Listening

Companies such as New.Net and Unified Root are allowing registration of Top-Level Domains (TLDs) — those 3 or 2 letter codes at the right-most end of domain names.  Currently, the folks behind the Domain Name System (DNS) — that is, ICANN — have resisted the introduction of new TLDs for intellectual property and ostensibly technical reasons.  Either way, ICANN has opted to maintain an artificial scarcity in domain names that artificially inflates the value of those names beyond their optimal economic value (which is near zero) and has caused various groups of people to make property claims to the DNS to prevent its growth or slow down potential uses — an anticommons at the heart of the Net. 

As ICANN begins its meeting in Vancouver, maybe it should stop a minute and consider what the alternate domain providers are doing.  First,  they’re allowing the sale of TLDs which frees up the domain name space for a host of registrable names.  If the COM space can handle millions of domain names, then even a modest introduction of 200 TLDs will allow for a potential for billions of registrable domain names.

Second, and less obvious, is the fact that as the number of registrable names nears infinity, there is less reason to automatically protect domain names as trademarks.  The reason for the latter is the current practice of users in guessing the wed address of sites by typing a trademark and adding a COM TLD.  This creates incentives for others to engage in deception or hoarding (aka cybersquatting) since certain domain names are more likely to drive traffic than others.  In a world where there are billions of domain names with a myriad of TLDs, there’s no point doing in that.  People will stop engaging in a guessing game and will instead use search engines to guide them along.  In that scenario, domain names will be worth almost zero and cybersquatting will no longer be a problem.  Trademark owners can have their own TLDs.  For example, Kraft can own the .KRAFT TLD and place all its corporate sites under that TLD — think of CHEESE.KRAFT or CHEDDAR.KRAFT.

In this way, the DNS can mimic the virtues of language and as we all know the trademark system imposes little costs to language. After all, we don’t need to pay royalties to Kraft every time we use that term, do we? 

Third, as the number of TLDs grow, innovators will shift from monopolizing domain names registrations and their hold on TLD resources (think of ccTLDs charging thousands of dollars for registrations), to providing DNS services to TLD owners.  The cost to the consumer of domain names will near the cost of providing the service.  While this argument may not resonate among those in the gTLD space (COM, NET, ORG) where the costs have gone down, they should realize that the scarcity of domain names means that prices will go up as usable domain names are blocked off by registrants. 

Finally, this will all result in putting the focus back to technological innovation in the DNS space instead of the current anti-commons being played out.  The DNS can fade back into obscurity much as it existed in the first 10 years or so since its inception.  Let’s let the geeks do their thing in peace, shall we?

So, ICANN has a choice — either free up the DNS space or maintain the scarcity.  I think it’s in their interest to choose the latter simply because scarcity and higher costs justifies ICANN’s existence and the quarterly international meetings they’ve been holding. Who could ever  want that gravy train to pull into the station?  One would be WSIS  which I think wants the train running on their own tracks.  A newly-minted deal with ICANN brings them a little closer to their goal.  But if ICANN follows the lead of alternate domain providers, WSIS should realize the futility of trying to control the DNS root.  There’s little wisdom in making policy decisions using authority drawn from the DNS.  In the end, such authority is based on friendly non-formal contracts which certain key players can choose to abandon.  If Microsoft and Linux agree to recognize the alternate roots, then ICANN’s (or WSIS’) power diminishes as well.  In the end, the geeks still rule.

Anyway, ICANN should take a closer look at the alternate roots because for me, they represent the future of the DNS.