Two years ago, I was introduced to Antony Van Couvering by Frank Michlick, because we both live in New York City and were interested in getting together with other industry professionals in our area. Since then, Antony and I have attended all of the NY domain get togethers, and he has been a resource for me when I’ve had questions about gTLDs. In fact, he is one of – if not the most knowledgeable person about gTLDs.
Antony has a diverse background, having grown up in the U.S. and overseas (Africa, Europe, Middle East), and he holds a degree in comparative literature from Columbia. He started NetNames and NameEngine, which handled domain names and associated marketing and intellectual property issues for large corporations. After Antony sold NameEngine, he worked for VeriSign for two years.
After this, in 2005, Antony founded his web consulting company, Names@Work. During this time, Antony worked in collaboration with DomainsBot, assisting the company with business development, product development, and marketing. He also set up and negotiated a major investment in DomainsBot from Sedo. Antony is now the CEO of .NYC, the top-level domain for New York City, and the founder of top-level consulting firm, Minds + Machines, with other industry veterans.
EJS: Other than acting as a supporter, what role will the city of New York have in regards to .nyc, will city offices use .nyc for their websites, and will they be involved with promotions?
AVC: We see the City of New York is a vital part of the .NYC top-level domain. .NYC should be run on behalf of New Yorkers, and the City is the best representative we have of the wishes of the people who live here. The City will receive a substantial portion of our revenues and we hope to involve them in a serious way in the outreach and marketing of .NYC to the residents and businesses of New York.
The City will have a permanent advisory role with regard to policy. For instance, several officials have expressed concern about spam, phishing, and some of the other ills that plague the Internet. Our view is that we need to do everything we can within the law to make .NYC a livable namespace. So we look forward to putting together policies that reflect our experience in the domain name world, with the assistance of the City to make sure that they reflect the wishes of New Yorkers and are consistent with the laws of New York. We will also look forward to their suggestions. There will be some learning on both sides; I’m sure that not everything that the City wants to do will be permissible under ICANN guidelines, and on the other side not everything that we think is a good idea is going to work in the real world of New York. But I am sure that .NYC is a great thing for New York City, and all the people I’ve talked to in City government agree — so we’ll find solutions to the issues as they come up.
As far as use of the .NYC top-level domain for City uses, we’re reserving a lot of names for use by them — names of city agencies, names of official City divisions (e.g., brooklyn.nyc), and other names that reflect official city business. New York City has a very successful web presence using nyc.gov, and it’s up to the City if and when they want to transition to .NYC. In any case the names will be there for them, we’ll hold the names off the market for their use.
I view this as a partnership, so the City’s role is important and indispensable. I’ve been a resident of New York City for over 30 years, but that doesn’t mean I know everything about it. On the other side, the City has a lot of experience in delivering city services through the web, but that doesn’t mean they know about domain name governance.
I should add that our experience is very similar to what applicants are seeing in other new TLD cities, such as Barcelona, Berlin, Paris, and Tokyo, as well as for regions, such as Scotland, Wales, Brittany, and Galicia. Governments are interested and willing, and are partnering with people who know the space. The form of the partnership may differ, but the essential effort is the same.
EJS: How will .nyc deal with local marks that might not be in the USPTO? For example, what happens if someone wants to register DallasBBQ.nyc, knowing that there are a few Dallas BBQ restaurants in the city, but no federal TM in the USPTO?
AVC: That’s a great question that I’m sure a lot of people are asking. I’m not a trademark lawyer, but I think I can be helpful. In the U.S. we have common-law trademarks, which means that you acquire rights in a mark by using it in commerce. So DallasBBQ would qualify under U.S. law as a valid trademark and they would have no problem qualifying for a .NYC domain name. As other TLDs have done at launch, we’ll hire a trademark validation expert who would decide which trademarks are valid, according to our policies and the law.
EJS: How can your company’s services be used to help other companies who want to apply for their own gTLD?
AVC: I run a company called Minds + Machines as well being CEO of DotNYC LLC. That happened because I was searching for a registry operator for .NYC and I realized that I knew just about as much as any of the incumbent registries, and that they all wanted to charge an arm and a leg. So I licensed the CoCCA registry platform for new gTLDs and added consulting services on top. CoCCA is currently used by over 20 ccTLDs, but they didn’t want to get into the gTLD namespace, and since we’ve had great relations for a long time, they were happy to help. I founded the company with Jothan Frakes, who’s the COO, and Elaine Pruis, formerly of CoCCA, who’s our VP of Client Services. We have 4 other people working with us full or part-time, and we expect to grow that substantially.
Recently, we signed up .ECO, which is supported by Al Gore’s Alliance for Climate Protection, as well as the Sierra Club, Surfrider, and a host of other environmental advocacy groups. We got them up to speed on ICANN, told them what would and wouldn’t work, and just helped them through the process. This is an example of great idea for a new TLD, run by experienced business people who know how to do their own marketing, which is something completely new to the TLD world. We think it’s going to do really well, and it’s one kind of TLD we want to work with.
At Minds + Machines, we work with anyone who meets two criteria. First, that they want to start a new TLD. Second, that we believe in their idea. It could be a brand, a city, a region, a membership organization, an entrepreneurial TLD. We explain the ICANN landscape, do some reality checks on their financial projections (or help create them, if they don’t exist), give advice and assistance with the ICANN application, meet their investors if they need that, help design their Sunrise and Landrush efforts, establish relations with existing registrars, find them staff to hire, and so on. The whole nine yards. Then we’ll run the registry on their behalf. Our prices are a lot cheaper than anyone else’s, and we’re very service-oriented. We try to make it workable for good ideas — for instance, if you hire us for consulting, and then use our registry, we’ll refund you the entire amount of your consulting fees from our registration fees once the TLD is live. We’ve had a great response, we’re currently in discussions with over 20 potential new TLDs.
EJS: What do you think the annual costs will be to maintain a gTLD registry (.Elliot for example), and what things do companies or individuals need to consider before applying for one?
AVC: There’s a lot of different ways to respond to this question. At the startup phase, if you just look at ICANN fees, you would need to spend $185K for the application fee, and maybe (if you’re unlucky) fees to deal with any competing proposals or to objections. If — and it’s only an if — that happens, you could be looking at $500K. And then there’s the possibility of an auction, where it could go very high. So if you want .web, or any of the “obvious” TLDs, you should be prepared to spend quite a bit. On an ongoing basis, you’re looking at $25K a year minimum from ICANN (up to 100,000 names), plus whatever it costs to maintain the registry. At Minds + Machines we charge $1.50 per name per year, and the competition charges up to $4 per name.
If you’re thinking about doing a new TLD, you need to think about a few things. First is, do I need to make a quick exit? Almost every TLD makes money in the medium term. Suppose you match VeriSign’s wholesale price (about $7 per name per year) to registrars. With an industry-wide 75% renewal rate, and the across-the-board annual domain name growth rate is 15%, it’s a nice annuity even for a medium-sized TLD. That said, it may take a year or two before you get to a comfortable size.
I would also think hard about the business model — not every TLD is going to get huge numbers, but there are so many other ways to use a TLD. For instance, you could get a name for a profitable vertical niche and do extremely well with just a few sites. For instance, if you applied for .limo, you could have sites for each major city — nyc.limo, vegas.limo, etc. — as well as functional names such as weddings.limo, graduation.limo, and so on. That’s just one business model. There are others too — it’s a question of using your imagination and then seeing how to accomplish what you want within the ICANN rules.
Don’t depend on the registrars to market your TLD. Registrars are interested in marketing themselves, not you. The smart TLDs will be thinking hard about how to reach their target market and putting resources behind that effort. “Build it and they will come” is not a strategy that will work anymore, if it ever did.
Finally, if you’re thinking about doing a TLD, do it now, and announce it as soon as you’re able. It’s very possible that someone else is thinking about doing “your” idea, and you really don’t want to be the second person with the idea. There are so many possibilities for TLDs that announcing will probably just convince the competition to do one of their other ten ideas, where there’s less chance of an expensive auction. Even if they don’t go away, they may well come to you looking for a deal, and you’ll be in excellent shape.
EJS: When do you hope to see new gTLDs approved, and when do you realistically think we will see them in the market?
AVC: It looks as if the application window will be Feb – March of 2010. Realistically you will see new TLDs in the market by summer 2010, with the majority opening toward the end of the year.
BONUS Questions!
EJS: Why are you so bullish (as opposed to bearish) on gTLDs?
AVC: In an already very crowded online world, you have to have visibility to get noticed, and a top-level domain (you can’t go any higher), especially if you get it in this window, provides that. I’ve seen the same issue in the ccTLDs, a space I worked in for a long time. How many companies and individuals from India have domain names? Millions. But how many use the .IN domain name — not very many, though recently the number is growing. For many years it was nearly impossible to get a .IN name, and as a result you rarely see it on the web. That has been a huge cost for India, which allowed their innovative tech entrepreneurs to brand VeriSign’s .COM instead of their own country TLD.
For a brand owner, having your brand name as the destination for your customers on the web is ideal. How much money do major corporations spend on branding, and how effective is Internet visibility? To me, it’s a no-brainer to brand yourself instead of a domain extension like .COM which has nothing to do with your brand. For a city, it’s a tremendous aid to tourism and local business, with great possibilities for civic initiatives. Another key advantage, if you keep your TLD clean (in other words, take steps to discourage warehousing, non-working sites, and template sites), is that search engines will pay attention. For instance, .NYC will be about New York City in a meaningful way, and if Google wants to deliver relevant searches (which it does), then it will favor the .NYC TLD when someone types in “nyc” or “new york city” or “manhattan” or any other New York-related term.
Also, I just love the innovative business plans I’m hearing around new TLDs. There are so many things to do with a TLD, and if you own a name at the top level you can never be usurped. People talk about how users automatically default to using .com, and how that will never change, but frankly that’s just silly. No-one has ever produced any empirical evidence to support that idea. In fact, the evidence points to the opposite: everyone used a radio, and they still do, but it didn’t take long to switch to television. Everyone used 8-track tapes, until cassettes came along, and they were displaced by compact disks. If there’s a benefit, people will switch. Outside of the U.S., people routinely use multiple TLDs without a second thought. I’m completely convinced that this is an inflection point in the Internet, and that there are green fields, and great rewards, for people with imaginations and a few dollars to spend.
EJS: Wild card
AVC: If you just want to throw your .COM names up on PPC pages and hope and pray that revenues go up again, and that Google and Yahoo one day decide to mess up the whole parked pages ecosystem, then probably you should stay away from new TLDs. Each one is a business that requires the things that businesses usually have: staff, meetings, web design, customer relations, insurance, all that stuff. It’s really not dissimilar from what you do, Elliot, when you decide to develop one of your .COM geodomains, such as lowell.com. A new TLD is just another domain with a business wrapped around it, which needs care and attention to its strengths and weaknesses. Its customers could be registrars, but they could also be consumers, it just depends on your business model. Find your idea, run to your corner, protect that space, and develop it. This is a great time to be imaginative and bold.