What the new domain names mean to your business

As we discussed in 2008, there’s a new type of internet address about to sweep into the online world. It may well change the web, but not quite in the way the promoters are saying.

On Monday, ICANN, the International Committee of Assigned Network Names, approved the release of custom global top-level domain names. Organisations can now buy their own internet address rather than adding a .com or .com.au to the end of their online business name.

For example, Telstra can replace its telstra.com.au or telstra.com addresses with .telstra and offer sites like support.telstra or shop.telstra.

Some are claiming this portends the end of the dot.com era as business drift across to these newer domains, abandoning the addresses we’ve become used to over the past 20 years. Others say it will make data easier to find and consequently kill the search industry.

In truth, the immediate effects on businesses are going to be limited, but these new names are part of a much bigger change happening in the online world.

Take-up will be slow

One of the first things to understand with these domains is they are mired in bureaucracy, with ICANN itself estimating the approval process will take between eight and 18 months.

Should an application be approved, there will also be a period where approvals will be subject to appeal. This will prove interesting when conflicting claimants decide to fight over a domain.

The arguments over who owns generic names will probably end up in the courts while geographic disputes, say between Melbourne, Florida or Melbourne, Victoria over the .melbourne address, will require some tricky negotiation.

Costs are high

The application cost of one of these global top-level domains is estimated to be US$185,000, with $25,000 annual fees, so this is a game for only the biggest players.

Even then, we’ll see many corporations not bothering. Given the current proposal includes strong provisions against cybersquatting, there’s no need for trademark holders to rush – it’s quite feasible that many will sit out the hype and wait for the prices to drop.

ICANN’s track record is not good

Over the last decade ICANN has approved 14 new domains – .aero, .coop, .museum, .name, .pro .asia, .cat, .jobs, .post, .tel, .travel, .biz, .info, and .mobi – the last three have been mildly successful but most of these names have been ignored. It’s a precedent that doesn’t bode well for a corporation or government building their own domains.

There are some useful network management reasons and possibly some branding opportunities with these names, but the risk of confusing customers or web surfers seems to be high.

In this respect, the argument that the new domains will kill search engines seems odd, as more addresses is going to increase the demand for a reliable way to find things online.

The middlemen assemble

Already some are touting the new domain names as an opportunity to get more money out of businesses with the idea various sectors can be enticed to use industry- or location-specific names. However, history isn’t on the side of those schemes, as we’ve already seen the release of the .travel and .jobs domains being greeted with a yawn.

One effect we can expect is that we’ll be told over the next few years how important it is be to list our business names with a whole lot of new domains; musicians might be urged to sign up with .music or Perth based enterprises to lock in a .perth name. In many ways these ideas already seem to be an attempt to replicate the old directory businesses that the internet has destroyed in the last decade.

Locking down the web

Along with being a cash grab by ICANN, the custom domain name is part of the attempt to divide the public internet into a cluster of privately controlled fiefdoms.

We’re seeing with social media sites like Facebook – and we can be pretty sure .facebook will be an early candidate for listing – striving to lock users onto their service. These new domain names will help them do that and in turn protect data on their networks from being shared on the wider internet.

This is going to play out in a very interesting way over the next few years as the large players jostle for their slice of the web.

Some larger businesses, and gullible governments, are going to fall for this money-grabbing exercise, while the majority of internet users will be excluded simply by the cost and bureaucratic requirements.

This grab for the internet is a game for big, well-funded players and most of us will be spectators in this struggle. Have no doubt, though, that while watching the big boys fighting over their internet turf will be fun sport, it will be us who will pay for the results.

Paul Wallbank is one of Australia’s leading experts on how industries and societies are changing in this connected, globalised era. When he isn’t explaining technology issues, he helps businesses and community organisations find opportunities in the new economy.