The ability for businesses to buy .brand generic top-level domains (gTLDs) based on their trademarks could cause legal headaches for some companies, despite optimism from others that the move will help to combat online fraud.
The new initiative allows organisations to buy and manage an entire gTLD system that could include a number of URLs, such as sport.nike or drinks.coke, and has been put forward by the Internet Corporation for Assigned Names and Numbers (Icann).
However, Peter Matthews, managing director of brand management firm Nucleus, said at a Westminster Forum event in London today that the system could cause more trademark disputes.
"There are likely to be main trademark clashes with this new form of domain. The .polo brand, for example, could be taken by Volkswagen, Polo Mints or a clothing firm like Ralph Lauren," he said.
"Or what about Apple the technology firm and Apple Corp? Those two firms have been battling over trademarks for years already. The only people that will really benefit from this are trademark lawyers."
Olof Nordling, director of the Belgium arm of Icann, said at the event that, if multiple organisations want the same domain and are unable to reach any mediation, the matter would be resolved by an auction.
But Matthews insisted that small businesses will be priced out of the system to buy and run a registry relevant to their brand.
"It will cost more than the initial $185,000 to own a brand registrar, perhaps up to $500,000, so for small firms this is going to be out of their reach," he said.
However, Ben Crawford, chief executive of domain management firm dotBrand Solutions, suggested that letting businesses buy and run their own gTLDs has several benefits, such as tackling brand fraud and increasing customer loyalty.
"For brands that own a key trademark, this ability will help them combat fraud that is costing them millions of dollars in fraud, lost sales, customer theft and trying to protect their brand," he said.
"Many firms are looking at bundling access to personalised domains to increase customer loyalty offerings, so a brand like Canon could offer johnsmith.canon."
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