Was it all worth it?

Ben Anderson

The end of this month marks the third anniversary of the Trademark Clearinghouse (TMCH), and for many rights holders the time has come to renew the marks they placed in the TMCH at the start of the new gTLD program. Many opted for a three-year registration period, as that was the timeframe in which everyone expected the launches of some 1,000 new Top Level Domains to conclude.

As we approach this three-year milestone, we’re yet to see some of the most anticipated TLDs launch. The program has faced setbacks, legal challenges and contention-set auctions where in most cases the TLD was awarded to the highest bidder. With dotWeb, dotApp, dotMusic, dotAfrica and others still to launch, having a trademark in the TMCH is still the best way to secure rights in the mandated initial offering Sunrise phase of any TLD launch, and there are over 150 left to go.

But with rights holders largely ignoring the Sunrise periods, the question is whether the TMCH is actually worth it. There are now over 40,000 marks registered in the TMCH, and that number has steadily increased from 30,000 over the past year or so. But with so many registrations in the TMCH, why do popular TLDs such as dotBlog and dotShop fail to even get 5% of that number in Sunrise?

The absence of rights holders in Sunrise has been a big feature of the new gTLD program, with many commentators talking about the stark difference between launch volume and the TMCH statistics, and concluding that the TMCH is simply not effective. The reality is that attitudes towards registering domains purely for defensive reasons have changed as the naming space has grown. It’s the less talked about features of the TMCH that are a lot more interesting…

As registry operators have sought to gain traction in their namespace or manipulate rights holders to buy domains they simply don’t need, it’s the emerging bolt-on products that require a TMCH registration. The Donuts Domain Protected Marks List (DPML) and the new DPML Plus product require registrants to hold a valid TMCH object for the lifetime of the product for it to remain valid. This isn’t collusion, but a simple way of Donuts outsourcing the verification of rights to a trusted third party. Other registry operators have also recognized that allowing rights holders to block large swathes of the new namespace is appealing not only to the rights holders but also to the operators, as it reduces the amount of malicious activity in their TLD.

NetNames customers have for some time now benefited from the extended service, which is a value add on top of their TMCH registrations and allows the effective monitoring of the entire gTLD space − not only in the claims period but also on an ongoing basis. The most interesting statistics of the TMCH, however, are not the Sunrise registrations or the blocking products, but the domains that were never registered. That may sound bizarre, but official figures from Deloitte (the operator of the TMCH) show that using the TMCH service is vastly more effective in brand protection than defensively registering domains. The TMCH is never going to stop a career cyber-squatter or IP infringer from registering popular brand terms in the endless sea of suffixes, but it has stopped the hapless consumer from doing so. To explain, let’s look at the numbers:

714,544 notifications have been sent out to rights holders

This means that rights holders in the TMCH have been notified immediately of a registration matching their mark in any of the launched TLDs. In most cases, this is directly to the rights holder as it has opted to register the domain in the much more cost-effective General Availability (GA) phase.

246,017 claims notifications (notification of domain name registration exactly matching a TMCH mark in the first 90 days of GA)

Likewise, these notifications have occurred in the first 90 days of GA, and in most cases have been triggered by the rights holder itself.

468,527 ongoing notifications (notification of domain name activation matching a TMCH mark beyond the 90-day period)

This is a new feature of the TMCH that lets rights holders know if a domain has been registered after the 90-day claims period.

In some ways, this is impressive – but it still shows that squatting is rife in the new gTLD space irrespective of the rights protection mechanisms in place. The one stat, however, that is yet to be published is from the ICANN review into the effectiveness of the TMCH, and one that has been shared with NetNames. That is that a staggering 93.7% of the 1.8 million registration attempts that received a Claims Service notification were abandoned. That means the Claims Service has prevented over 1.68 million domains being registered during that phase. Multiplying the cost of a Sunrise registration or UDRP by that number as a crude demonstration of effectiveness makes me think that the modest cost of a TMCH registration is indeed well worth it, and extending the registration by one year should be a 'no brainer' for the proactive rights holder.