Ready, Aim, What? Digital Archery, Part 2: Implications

FairWinds Partners —  May 25, 2012

So now we know how ICANN’s Digital Archery process will work, and have a very rough idea of when that process will take place. On the surface, it may seem like having the process start before before Reveal Day is not a big deal – perhaps ICANN is even trying to make up for some time lost during the month-long TAS delay. But there could be some really serious ramifications to the timing of this process. And like so many other aspects of the New gTLD Program, these ramifications result from ICANN keeping applicants in the dark.

Consider the field of applicants. Some are major strategic companies that have applied for .BRAND or .GENERIC gTLDs, the majority of which will be closed to outside registrations. But many applicants are applying for traditional, open gTLDs with the purpose of establishing a business around selling domain name registrations. Many of those are likely entrepreneurs or new companies, some of which will be backed by investors and therefore are under pressure to deliver.

Those applicants that are planning to build a business around selling domain names in their gTLDs will have the biggest incentive to land in the first batch, because doing so will mean they can bring their gTLDs to market (and begin selling registrations) faster. These are the ones that will likely invest the most in solutions designed to get them into Batch 1. Already, certain technologies have emerged promising to help applicants hit the submit button closer to their target time than a human will be able to.

But more importantly, these companies know they want to be placed in Batch 1 more than, for example, corporate applicants likely do. Corporate applicants may want to forgo investing additional resources into making it into Batch 1 – unless all of their major competitors are in Batch 1. It stands to reason that if, for example, Ford and Toyota both applied for .BRAND gTLDs, and .FORD gets delegated in Batch 1 but .TOYOTA doesn’t reach market for months or even years later as a result of landing in a later batch, Toyota will lose a significant first-mover advantage to Ford. Toyota’s launch of .TOYOTA could, at that point, be seen as old news – perhaps even extremely old news as we pointed out in Part 1: Process.

Consider this: up through the entire application process, applicants have basically been on more or less equal footing – all had to meet the same deadlines, all had to pay the same application fee, and all had to complete the same application. But when it comes to Digital Archery, companies that decided to apply for new gTLDs to hedge their bets and possibly just keep pace with their competitors could suddenly see all of their advantage disappear. Applicants that land in late batches could find that by the time their gTLDs reach market, the news will already be old hat and they will miss the image uptick that earlier adopters will earn from their audiences.

Whether ICANN intended to or not, it has given traditional domain registry applicants an advantage here over corporate applicants by withholding certain information – namely, by starting Digital Archery before Reveal Day, a date that will certainly impact applicants’ demand for early batch positions, since that is the day that the missing input, competitors’ investment or lack of investment in gTLDs, will finally materialize.

Theoretically, corporate applicants can still decide to pursue a technological solution to shoot for Batch 1 after Reveal Day, but at that point, the entrepreneurial applicants may have already taken their digital “shot,” if you will. And if all of the available technological solutions allow the applicants who use them to hit “submit” at exactly their target time, then what does ICANN plan to do? How does it plan to order them in that case? If ICANN orders them on a first come, first served basis, then how can this be seen as anything less than an advantage for entrepreneurial applicants over corporate applicants?

The moral of the story here is, the batching process may be complicated, but the potential consequences of that process are even more complicated – perhaps even in ways we can’t yet imagine, for lack of information. And once again, ICANN has opted to keep applicants in the dark instead of upholding its tenet of transparency, which has only served to increase anxiety.

TAGS: Batching, Digital Archery, ICANN, Reveal Day

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