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Economic Analysis of New Gtlds 16jun10 En

Economic Analysis of New Gtlds 16jun10 En

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Published by mschwimmer
economimc analysis of top level domains
economimc analysis of top level domains

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Published by: mschwimmer on Jun 17, 2010
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04/24/2014

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 An Economic Framework for the Analysis of theExpansion of Generic Top-Level Domain Names
prepared for ICANNMichael L. KatzGregory L. RosstonTheresa SullivanJune 2010
 
 
i
CONTENTS
I.
 
INTRODUCTION AND OVERVIEW ............................................................................1
 
II.
 
BACKGROUND ................................................................................................................4
 
A.
 
M
ANAGEMENT OF THE
DNS
 
P
RIOR TO
2000 .............................................................4
 
B.
 
P
REVIOUS G
TLD
 
E
XPANSIONS
..................................................................................7
 
C.
 
T
HE
P
ROPOSAL TO
I
 NTRODUCE
 N
EW G
TLD
S
............................................................9
 
III.
 
THEORETICAL FRAMEWORK .................................................................................13
 
A.
 
P
RIVATE VERSUS
S
OCIAL
I
 NCENTIVES TO
I
 NTRODUCE
 N
EW G
TLD
S
.......................14
 
B.
 
B
ENEFITS OF
 N
EW G
TLD
S
......................................................................................18
 
1.
 
 New gTLDs might provide competition to existing gTLDs resultingin lower quality-adjusted prices.................................................................18
 
2.
 
 New gTLDs may support new business models .........................................20
 
3.
 
 New gTLDs might relieve scarcity in domain names .................................22
 
4.
 
 New gTLDs might reduce search costs ......................................................23
 
C.
 
C
OSTS OF
 N
EW G
TLD
S
...........................................................................................24
 
1.
 
Costs of obtaining and running a gTLD ....................................................24
 
2.
 
Costs to competing registries .....................................................................25
 
3.
 
 Increased search costs ...............................................................................25
 
4.
 
Trademark infringement ............................................................................27 
 
5.
 
 Adverse investment effects of potential free riding ....................................29
 
D.
 
T
HE
D
EPARTMENT OF
J
USTICE
S
F
RAMEWORK FOR 
A
 NALYZING
 N
EWG
TLD
S
....................................................................................................................30
 
III.
 
SURVEY OF EXISTING STUDIES ..............................................................................33
 
A.
 
B
ROAD
S
TUDIES OF THE
C
OSTS AND
B
ENEFITS OF
 N
EW G
TLD
S
.............................33
 
B.
 
S
TUDIES OF THE
I
 NCIDENCE AND
C
OST OF
C
YBERSQUATTING AND
T
YPOSQUATTING
.....................................................................................................37
 
C.
 
S
URVEYS OF
D
EFENSIVE
EGISTRATIONS
...............................................................42
 
IV.
 
POTENTIAL PROJECTS ..............................................................................................45
 
A.
 
P
ROJECTED
B
ENEFITS OF
 N
EW G
TLD
S
...................................................................45
 
1.
 
 Analysis of domain name registration volumes .........................................46 
 
 
 
ii
2.
 
 Analysis of domain name resale prices ......................................................49
 
3.
 
Switching costs and behavior.....................................................................54
 
B.
 
P
ROJECTED
E
XTERNAL
C
OSTS OF
 N
EW G
TLD
S
......................................................55
 
1.
 
Costs of increased registration, monitoring, and enforcement of trademarks across multiple gTLDs ............................................................56 
 
2.
 
Costs to consumers from increased confusion or fragmentation of the Internet .................................................................................................59
 
C.
 
C
ASE
S
TUDIES TO
H
ELP
P
ROJECT
E
XPECTED
 N
ET
B
ENEFITS FROM
 N
EWG
TLD
S
....................................................................................................................61
 
D.
 
U
SING THE
I
 NTRODUCTION OF
 N
EW G
TLD
S TO
G
ENERATE
A
DDITIONAL
I
 NFORMATION
.........................................................................................................63
 

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