INTA Study reveals New gTLDs Registrations are Mostly Defensive

The International Trademark Association (INTA) has conducted a targeted study into new gtld registrations. The results from the survey titled: INTA new gtld cost impact survey [PDF] gives some quite shocking revelations on the new domains.

The International Trademark Association (INTA) is a global organization of 6,600 trademark owners and professionals from over 190 countries. In 2013, hundreds of new generic top-level domains (“New gTLDs”) were introduced. INTA members and intellectual property owners have expressed concern about the New gTLDs on the basis that such expansion would likely create additional and increased costs in enforcing intellectual property rights.

Early this year, struggling gTLD registries through the gTLD Registries Stakeholder Group (RySG) were asking ICANN for 75% temporary fee cut & add $3 million marketing kitty.

A snapshot of some of the findings below

Defensive actions cost approximately $150k/year.

On average, INTA members spend $150,000 per year on defensive actions with internet monitoring and diversion actions the largest line item. Costs specific to new TLDs comprise about a seventh of the total.

Three-quarters of the members have taken action against domain name owners using new TLDs by either sending cease and desist letters and/or UDRP proceedings.

Internet monitoring and diversion related actions are the largest line item.

  • Costs specific to new TLDs comprise about a seventh of the total amount spend on defensive internet monitoring/diversion related activities.
  • Since these costs were for the early years of the new TLD program, it is reasonable to expect the proportion specific to new TLDs to rise.
  • Estimated costs vary widely among the survey respondents and are not correlated to company size. The range of total costs reported ran form zero to $5.2 Million.

Registration activity is heavily defensive

INTA members are active in the registration of domain names, including new TLDs.
• Vast majority (97%) of members registered domain names in past 24 months, with 9 in 10 registering new TLDs. But the volume of registrations varies widely across companies.
• Registrations of new TLDs were overwhelmingly made for defensive purposes—to prevent someone else from registering it. As such, few (10%) felt there were alternative domains to consider—whether registering a New, Legacy or ccTLD.
• Parking these domains is a very common practice. Redirection is also common, but less so for the new TLDs.

Premium pricing affects most
Members (73%) evaluate premium pricing on case-by-case basis and most (67%) say they are affected by it to some degree.

• The majority (73%) of members evaluate premium pricing on a case-by-case basis, while 15% flatly refuse to pay premium pricing and another 6% pay for top marks only.
• In general, two-third (67%) of members feel their domain name registrations have been affected by premium pricing (notably .sucks).
• Half of the members (55%) have observed evidence or examples of discriminatory pricing or unfair business practices related to new TLDs.
• For legacy TLDs, only 2 in 10 (21%) are aware of premium pricing.

New TLD Enforcement—75% took action
Most typically take action via cease and desist letters and/or UDRP.

• Three fourths (76%) of members have taken action against domain name owners using new TLDs by sending cease and desist letters and one in four (27%) have used UDRP proceedings.
• Few have taken the next steps of Civil Actions, URS Proceedings, ACPA Lawsuits/Appeals and Trademark Infringement Lawsuits/Appeals (between one and 4 members for each).
• Three fourths (76%) have spent more than $1,000 on Cease and desist letters in the past 24 months.
• While less common, those who have taken UDRP actions spend 3x the average of cease and desist efforts.
• Actions against Registrars are much more common than against Registries. Costs against Registrars average almost $8k.
• Most receive responses from letters sent to privacy/proxy services.

Find more about the INTA new gtld cost impact survey [PDF]

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