By Stuart Durham

Applications for a new generic top level domains (gTLDs) are set to open in January 2012, changing the way some brand owners control and manage their online brand presence.  For advocates of the new gTLDs, these ‘.brand’ domains are a marketing game-changer, but the changes have also attracted some vocal critics.

Advertising associations, including the Interactive Advertising Bureau and Direct Marketers Association, have been particularly vocal in their opposition to the new domains, claiming the new gTLDs will increase cybersquatting and make it ‘easier for online felons to cloak themselves in the names of trusted brands’

Online trust is a huge and highly emotive issue for brand owners but the argument that the new gTLDs will lead to some kind of cybersquatting free-for-all just doesn’t stack up.

Cybersquatters won’t apply for a new TLD

Cybersquatters are opportunists who have long thrived in an environment where ‘no questions asked’ domain names can be purchased for just a few pounds. At $185,000 USD just to apply for one of the new gTLDs, ICANN has set the bar deliberately high so that only organisations that satisfy ICANN’s requirements get the chance to operate their own new TLD.  Secondly, ICANN is unlikely to allow confusingly similar names or ‘typos’ to be approved in the application process – so for example, if .hsbc is approved, .hbsc won’t be allowed.

Ownership of a .brand enables brand owners to exert far greater control of who uses their name on the internet. By creating and owning a unique piece of online real estate, brands are able to exert full control over who resides in that space – making cybersquatting impossible on a .brand domain.

Scoping the threat in new generic names

What about the expected new generic names like .music, .web or .shop?  Some of these new names will have restricted registration requirements to allow only companies or individuals in the industry or community the name represents – for example, .hotel could be restricted to only hotel operators – reducing likelihood of cybersquatters on those domains.

So that leaves only the new open registries.  While it is hoped they will set responsible registration rules, the chance for cybersquatting on the new open names will exist.  However, while it is hard to definitively say how many new open registries there will be, it is likely the number of truly open new TLDs will be significantly smaller than the total number of new gTLDs.

Big brands – the primary targets of cybersquatters – won’t necessarily have to register all their brands in the new open TLDs.  They could register in only those which they feel are higher risk, and monitor the rest of the new domains for any infringements and take action on a case-by-case basis.  Or they could just take a purely monitoring approach for the new TLDs.  It will depend on the risk profile of the organisation, but the point is that blanket registration across the new open TLDs is not the only effective option on the table.

It’s worth remembering that there are already 200+ top level domains in existence today which cybersquatters can choose from, and savvy brands are monitoring these for infringements to take action where necessary.

Using the new TLDs to lower risk

Perhaps most significantly however, a .brand provides brand owners with a simple visual cue to help Internet users distinguish between real sites and fake ones, something which the current domain name system has failed to achieve.

Research Melbourne IT DBS conducted with YouGov found 48% of consumers rate brands as either fair or poor in adequately distinguishing their sites from counterfeiters.  A similar proportion (51%) admit they find it difficult to differentiate between sites selling genuine goods and those which sell fake or counterfeit items.

A .brand gTLD is not an overnight solution to these issues. But in the long-term, if brands educate and encourage customers and other stakeholders that their .brand site is the one to trust, internet users will make the trustworthy .brand domain their first and only choice.

By casting off the shackles of the existing naming system, the new gTLDs present an opportunity for brand owners to create communities of trust and reassurance for their audiences.

With so much of the long-term future of the Internet to be based on authentication and trust, savvy brand owners can use the forthcoming changes to their advantage for long term online brand benefit.