Report on TLD Applications: Application of the August 15 Criteria to Each Category or Group
(9 November 2000)

c. Restricted Content Group

The four applications in this group are:


Strings Requested
Blueberry Hill Communications, Inc. .kids
DotKids, Inc. .kids
ICM Registry, Inc. .kids, .xxx
.KIDS Domains, Inc. .kids

Threshold Review

The evaluation team applied the first and the last criteria to these applications and compared applications for the same or similar TLD strings on an overall basis as described in Part III.B.1.a. As a result of this review, the evaluation team concluded that the following applications merited further review:


Strings Requested
Blueberry Hill Communications, Inc. .kids
ICM Registry, Inc. .kids, .xxx
.KIDS Domains, Inc. .kids

The technical team concluded that the DotKids, Inc. application did not contain sufficiently complete information to evaluate all technical issues. The technical team was also concerned that the participants in DotKids, Inc. do not have relevant experience and that the software the applicant proposed using has little history in high volume applications. The DotKids, Inc. proposal also did not plan to replicate the registry at a second geographically separated site, raising concerns of problems arising in case of catastrophes. The business/financial team concluded that the DotKids, Inc. application lacked capital funding and was not as strong as the other three applications for the same string.


Having applied the first and last of the August 15 Criteria to these applications as a threshold matter, the evaluation team considered how each of the August 15 Criteria should be applied to proposals for these TLDs. The evaluation team concluded that the August 15 Criteria apply as follows:

August 15 Criteria

Application to Restricted Content Group
The need to maintain the Internet's stability Generally applies
The extent to which selection of the proposal would lead to an effective "proof of concept" concerning the introduction of top-level domains in the future Applies primarily with respect to the introduction of a potentially large top-level domain with explicit or implicit content restrictions
The enhancement of competition for registration services Generally applies
The enhancement of the utility of the DNS Applies primarily with respect to appropriateness of the TLD label, avoidance of confusion of TLDs and the extent to which the TLD will aid users
The extent to which the proposal would meet previously unmet types of needs Applies primarily with respect to expanding the DNS to include TLDs with explicit or implicit content restrictions, especially a .kids TLD
The extent to which the proposal would enhance the diversity of the DNS and of registration services generally Generally applies
The evaluation of delegation of policy-formulation functions for special-purpose TLDs to appropriate organizations Generally does not apply, but a .kids TLD raises definitional issues similar to the representativeness criteria
Appropriate protections of rights of others in connection with the operation of the TLD Generally applies
The completeness of the proposals submitted and the extent to which they demonstrate realistic business, financial, technical, and operational plans and sound analysis of market needs Generally applies

Meeting unmet needs, enhancement of the utility of the DNS, and proof of concept seem particularly relevant to analysis of these TLDs.


The threshold review concluded that all of the remaining applicants presented proposals that provided for stable operation of the proposed TLDs. As the evaluation team reviewed Blueberry Hill's technical proposal in more detail, however, some stability concerns appeared. The evaluation team is concerned that Blueberry Hill does not yet have a firm commitment from its proposed registry operator, JVTeam, to run the registry. In the absence of JVTeam or some other suitably qualified technical support organization, Blueberry Hill lacks the relevant technical experience to run the registry. The technical team concluded, as discussed below, that the technical plan presented by Blueberry Hill carries a substantial risk of not meeting the business plan requirements.

Meeting Unmet Needs, Enhancement of Utility of the DNS and Proof of Concept

The three proposals in this group address a variety of perceived needs. These needs may be analyzed as follows:


The genesis of the .kids TLD proposals appears to be the desire to provide a safe online environment for children. One of the applicants for a .kids TLD notes that in the United States 25 million children between the ages of 2 and 17 are currently online, 68% of teenagers are currently online, and 62% of children between the ages of 2 and 17 will be online by 2005. Providing a TLD that would designate a safe online environment with content suitable for children and families would, in the view of many, meet an unmet need and enhance the utility of the DNS. However, given the difficult definitional issues inherent in a .kids TLD, together with the limitations of existing technology and the approaches suggested by these proposals, it is questionable whether these applicants would be able to meet the unmet need and provide an effective proof of concept.

The concept of a content-restricted TLD presents difficult definitional issues: Who is a "kid"? What content is "appropriate"? And who decides? Given the international reach of the Internet, the complexity of these definitional issues is compounded by many diverse cultures and a variety of community and individual views on the answers.

The .KIDS Domains application contains perhaps the most complete description of how the applicant proposes to deal with the definitional issues. The applicant proposes establishing a Content Policy Board, independent of the applicant's board of directors. The Content Policy Board will (i) facilitate the establishment of a standardized policy on content suitability, (ii) facilitate the processes and procedures for the enforcement of the policy, (iii) oversee and administer an auditing system, and (iv) oversee the High Risk Group Self Regulatory Commission. The High Risk Group Self-Regulatory Commission would be composed of registrants, mostly large companies, whose websites contain a large amount of content that is not under the direct control of the registrant. The High Risk Group Self-Regulatory Commission will work to determine definitions for content that is harmful and inappropriate to minors. (Of course, it should be noted that some do not believe that the success rate of large companies policing their content has been very good.) While .KIDS Domains recognizes and attempts to deal with the issue of "what content is appropriate", its proposal does not address the larger conceptual concern whether a self-appointed TLD sponsor should make these decisions.

All of these proposals express a desire to achieve a TLD that contains only material suitable for children, although there are wide variations in views of how to achieve that desire. .KIDS Domains suggests auditing mechanisms to determine if content registered under the .kids TLD meets the established policy. .KIDS Domains also proposes working with content filtering companies, but does not provide details of how filtering would work in this context. Based on its proposed plan, .KIDS Domains appears to be the only one of the remaining applicants to have any prospect of enforcing its policies. Neither Blueberry Hill nor ICM Registry proposes any business or technical methods to effectively restrict content for a .kids TLD. For comparison purposes, although it is not one of the remaining applicants, the DotKids proposal calls for a rating system of content stored in domains under the .kids TLD. Ratings would be stored in the registry. (The technical team was concerned, however, that the proposal had few details on how the rating information would be made available to the user's browser, or about the likely impact of this rating system on the size of the registry and resulting traffic to the registry to check ratings.)

The evaluation team believes that in order to be successful in meeting unmet needs and providing an effective proof of concept of a safe online domain for children, an applicant for a .kids TLD must be able to deliver on the explicit or implicit public expectation of suitable content. At this juncture, it appears that there are no technical or other means to ensure that unsuitable material is not available to children while the applicants rely on partial measures that are not self-executing and that seem certain in execution to fall short of public expectation.

Particularly in light of the intense level of public (including governmental) interest in protecting children from inappropriate online content, one would expect a content-restrictive TLD for children to set forth not only a clear, widely-accepted definition of what is inappropriate, but also to define a decision-making process that commands the support of a wide spectrum of interested parties. Likewise, because these proposals all make .kids domain names available to registrants worldwide, one might reasonably expect to see a greater showing of such support than was evident in these applications. The absence of a clearly defined and globally diverse policy-making and policy-enforcing mechanism for a content-restrictive TLD is particularly troubling where, as here, there are such great divergences among communities, faiths, cultures, and individuals over the correct definition of what is and is not appropriate content for children.

Other potential concerns about content-restrictive TLDs include the difficulty of applying and enforcing content restrictions to email, chat, newsgroups, instant messaging, and other potential uses of the DNS beyond the World Wide Web.

While these concerns need not be insurmountable in the long run, they do appear to indicate shortcomings in the proposals currently under review.


ICM Registry's application for an .xxx TLD does not appear to meet unmet needs. Adult content is readily available on the Internet. To the extent that some believe that an .xxx TLD would segregate adult content, no mechanism (technical or non-technical) exists to require adult content to migrate from existing TLDs to an .xxx TLD.

It is interesting to note the opposition of at least some segments of the adult online content industry to a .xxx TLD. In testimony recently presented to a United States commission chartered by the U.S. Congress to "identify technological or other methods that will help reduce access by minors to material that is harmful to minors on the Internet" - the COPA Commission <http://www.copacommission.org> -- the president and CEO of a leading firm in hosting services for adult sites testified:

"While the proposition of XXX Domain is well intentioned, a XXX Domain, however, is not a global solution for the World Wide Web. It poses ethical risks to a diverse American public, financial burdens on Adult consumers and the Adult Online Community, as well as the assurance of biased censorship on the part of search portals."12

The COPA Commission articulated some of the more common reservations about a content-specific TLD for sex-related speech, even when its content-designation is purely voluntary:

"Privacy and First Amendment concerns may be raised by the clear identification of a 'red light district' and the stigma involved in being found there, and the concern about a 'slippery slope' toward mandatory location in the gTLD."13

Though these concerns are certainly not universally shared outside (or even within) the United States, they indicate the degree of controversy that surrounds .xxx.

The evaluation team concluded that at this early "proof of concept" stage with a limited number of new TLDs contemplated, other proposed TLDs without the controversy of an adult TLD would better serve the goals of this initial introduction of new TLDs. If an adult TLD is to be introduced, moreover, it would be beneficial to have a diversity of proposals, with a diversity of possible approaches to the various problems, from which to choose.

Enhancement of Competition

Evaluation of whether these proposals would enhance competition for registration services encompasses several inquiries, including whether the proposed TLD and registry are likely to be attractive to a significant market segment in which it can compete effectively, the adequacy of marketing and promotion plans, the competitiveness of proposed services, pricing and service levels with other TLDs and operators that currently have significant market position, and restrictions on accredited registrars.

In order to conclude that it is likely to be able to identify and meet a significant market demand in which it can meet unmet needs and provide an effective proof of concept, the applicant must realistically assess the business, financial, technical, operational, and marketing requirements for implementing the proposal and procure firm commitments for necessary resources. Some of the significant factors in this portion of the evaluation are summarized in the following table:


Expected Cumulative Number of Registrations
(Year 4)

Capital Investment

Marketing Budget
(Year 1 - 4)
Blueberry Hill Communications, Inc.



ICM Registry, Inc.

.xxx: 1.2M

$5M .

xxx: $7.4M

.kids: Not apparent from application

.kids: Not apparent from application
.KIDS Domains, Inc.


$10M for sponsor: $3.5M for registry operator

$31.9M for sponsor; $0 for registry operator

As the table indicates, wide variations exist among these applicants. Expected demand for a .kids TLD in year 4 ranges from 3.9 million to 12.66 million registrants. ICM Registry estimates a demand for a .xxx TLD in year 4 of 1.2 million registrants. In comparison, at the end of September, 2000, .com had approximately 20 million registrations. The initial equity investment also varies widely. All of these applicants propose leveraging existing infrastructure, including outsource partners. The number of registry operator employees in year 4 is not apparent from these applications. Even accounting for this, the table indicates that .KIDS Domains with respect to the .kids TLD and ICM Registry with respect to the .xxx TLD appear willing to devote significantly more resources in order be attractive to a significant market segment and to compete effectively for the demand generated by that segment. The evaluation team is concerned, moreover, that Blueberry Hill does not yet have a firm commitment from JVTeam to run the registry. In the absence of JVTeam or some other suitably qualified technical support organization, Blueberry Hill lacks the relevant technical experience to run the registry.

Other relevant factors in the evaluation include proposed pricing and service levels. The following table summarizes these applicant's proposed pricing and service levels:




Time to Confirm

Time to Reliance

Blueberry Hill Communications, Inc. $500/year during months 1-3; $79/year during months 4-27; $35/year thereafter (contribution to charitable organization)



 12 hours

ICM Registry, Inc. To Sponsor: $28 per yearTo Registry: $6 per year

.xxx: Unspecified

.xxx: Unspecified

.xxx: 4 hours

.xxx: 10,000 transactions/ day

.kids: 99.40%

.kids: 5 secs

.kids: 24 hrs

.kids: 20M transactions/ day
.KIDS Domains, Inc. To Sponsor per year: Personal use: $19; business use: $39 - $2500To Registry per year: $4 each for first 250,000; $3 each thereafter



5 minutes

230 tps

The proposed prices vary widely based on the application's business model. Blueberry Hill Communications proposes to make a charitable contribution of $100 for each registration during the sunrise period and $9 for each registration during the remainder of the twenty-seven month "phase one".

Availability, time to confirm (where provided) and time to reliance are all adequate to support the type of registry operation envisioned by the applicants. However, since Blueberry Hill expects to have 12 million names under management after four years, a much lower time to reliance would be advisable.

The evaluation team has a much more serious consideration in connection with the capacity estimates. ICM Registry and .KIDS Domains have provided estimates that are in keeping with the anticipated size of their registries. Their technical plans indicate that they will be able to meet these targets. In the case of ICM Registry's estimates for the .xxx TLD, the systems are somewhat undersized. The technical team anticipates that ICM Registry should be able to address these issues. Blueberry Hill did not provide a quantitative capacity estimate. The technical team believes that the systems, as configured in Blueberry Hill's application, fall short of what will be required. Blueberry Hill has proposed to make use of the capabilities of JVTeam, but as noted above does not yet have a firm commitment from JVTeam to run the registry. The technical team concluded that the technical plan presented by Blueberry Hill carries a substantial risk of not meeting the business plan requirements.

Another competitive issue considered in evaluating the proposals is whether the proposals restrict the ability of accredited registrars to offer registration services within the TLD. The following table summaries the restrictions contained in these applications:


Restrictions on Accredited Registrars
Blueberry Hill Communications, Inc. Blueberry Hill appears to operate as the sole registrar for the first 27 months. New registrars will be selected after 27 months.
ICM Registry, Inc. No restrictions
.KIDS Domains, Inc. .KIDS Domains will operate as sole registrar

.KIDS Domains does not allow registrars to process applications for the TLD. During the first 27 months, it appears that Blueberry Hill proposes operating as the sole registrar for the TLD. During the period of restriction, neither .KIDS Domains nor Blueberry Hill provides other, effective mechanisms for providing competitive choices to domain-name holders seeking to register within the TLD. In addition, failure to use other accredited registrars may adversely impact effective marketing of the TLD to the public by eliminating marketing efforts by other accredited registrars and reduce the ability of the new TLD to provide an effective competitive alternative to other TLDs and operators serving that market segment today.

Enhancement of Diversity

Enhancement of diversity applies to analysis of proposals for these TLDs. Evaluation of whether these TLDs enhance diversity encompasses several inquiries, including diversity in business models and of geographic locations. Some of the significant factors in evaluating whether these proposed TLDs are likely to enhance diversity are summarized in the following table:




Outsource Partner

Revenue Model
Blueberry Hill Communications, Inc. Palm Desert, CA Chestermere Investment Limited JVTeam (NeuStar (US) and Melbourne IT (Australia) subscription-based revenue model (with charitable contribution feature)
ICM Registry, Inc. Toronto, Canada   .xxx: dotTV (US) subscription-based revenue model
.kids: Verisign (US)
.KIDS Domains, Inc. Burbank, CA   Tucows, Inc. (Canada) subscription-based revenue model

ICM Registry is a Canadian company, which would enhance diversity of geographic location of operators of large TLDs. One of the participants in JVTeam, Blueberry Hill's proposed registry operator, is an Australian company. .KIDS Domains' registry operator, Tucows, Inc., is a Canadian company.

All of the applicants propose a subscription-based revenue model. As mentioned above, Blueberry Hill proposes to make charitable contributions during the initial twenty-seven months.

Protection of Rights of Others

Protection of the rights of others is another of the August 15 Criteria relevant to analysis of the restricted content group. As mentioned in the June 13 Report, TLDs focusing primarily on commercial uses should afford greater protections than TLDs focusing on non-commercial uses.

The proposals in this group provide differing approaches for the protection of the rights of others, summarized as follows:

Blueberry Hill Communications

Blueberry Hill Communications proposes a 90-day sunrise period for registered trademark holders. A modified sunrise period dispute policy is provided which uses registrant affidavits as evidence and locks the domain name down until resolution of the dispute. There are no limits to the number of registrations. To curb abusive registration practices a 2 year, non-refundable registration is required. The basic dispute resolution procedure will be the UDRP. There are no provisions for a content restriction method within the .kids domain, but instead relies on a segmented product that the marketplace will naturally rally around "to do the right thing."

ICM Registry

ICM Registry proposes a sunrise period for qualifying trademark owners to pre-register their marks. During the sunrise period, trademark owners are only allowed to register domain names identical to their respective marks. To aid in curbing abusive registrations, a free registration watch service for qualifying trademark owners will be implemented along with mandatory 30-day waiting period for review of all domain names prior to being added to the zone file. During the initial roll out phase an auction process will be used for registrations; afterwards, registrations will be on a first-come, first-served basis. Dispute resolution is conducted under the UDRP. The parameters of the Whois data watch service are not clearly defined but the proposal provides for an interactive web page and port 43 Whois service. There are no provisions for a content restriction policy.

.KIDS Domains

.KIDS Domains proposes a four phase registration plan which starts with a sunrise period for qualifying trademark owners to pre-register marks. Only the owners of famous marks, identified by the WIPO and U.S. Federal Trademark Registration can register during the sunrise period. The second phase consists of an auction of the top 1,000 to 2,000 names followed by a "wrist band" registration period and finally, an open period. Dispute resolution will be conducted under the UDRP. An up-to-date Whois database with total public availability is provided.

Given the restricted nature of the group, ICM Registry and .KIDS Domains generally propose adequate protections for the rights of third parties. Blueberry Hill, although adopting the UDRP and some general base line protections, does not provide sufficient detail in describing its willingness to work with intellectual property owners to ensure proper protections. If in the future, one or more of the applicants in this group is accepted, the evaluation team recommends that further clarification and direction be required.


Because of the inadequacies in the proposed technical and business measures to actually promote kid-friendly content, the evaluation team does not recommend selecting a .kids domain in the current phase of the TLD program. In addition, because of the controversy surrounding, and poor definition of the hoped-for benefits of, .xxx, we also recommend against its selection at this time.


12. Testimony of Andrew Edmond to the COPA Commission on the Issues of Labeling, Rating and Filtering.

13. COPA Commission Final Report, Section E(10), at <http://www.copacommission.org/report/newtopleveldomain.shtml>.

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