Criteria for Assessing TLD Proposals 15 August 2000

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Criteria for Assessing TLD Proposals

ICANN expects to receive many applications to sponsor or operate new top-level domains (TLDs). In this year's application program, it is likely that only a few of these will be selected by the ICANN Board for negotiations toward registry sponsor and operator agreements. To the extent possible, as this process continues ICANN will provide additional guidance on the likely number of TLDs to be included.

The ICANN staff is responsible for gathering information about submitted applications, evaluating the applications and associated information, and making recommendations to the Board based on the applications, associated information, and evaluations. In its evaluations, the ICANN staff currently intends to consider at least the factors described below. Applicants are invited to be creative and to explain the value of their proposals in the context of these and any other relevant factors.

1. The need to maintain the Internet's stability.

ICANN's first priority is to preserve the stability of the Internet, including the domain-name system (DNS). Proposals should demonstrate specific and well-thought-out plans, backed by ample, firmly committed resources, to operate in a manner that preserves the Internet's continuing stability. The introduction of the proposed TLD should not disrupt current operations, nor should it create alternate root systems, which threaten the existence of a globally unique public name space. Security and reliability of the DNS are important aspects of stability, and proposals should set forth comprehensive strategies to assure both.

ICANN will undertake a wide-ranging assessment of a proposal's treatment of stability issues. Among the significant aspects of stability ICANN will review are:

a. The prospects for the continued and unimpaired operation of the TLD in the manner proposed by the registry operator or sponsor throughout the period for which the delegation is agreed;

b. Provisions to minimize unscheduled outages of registry or registration systems due to technical failures or malicious activity of others;

c. Provisions to ensure consistent compliance with technical requirements in operation of the TLD;

d. Effects of the new TLD on the operation and performance of the DNS in general and the root-server system in particular;

e. Measures to promote rapid correction of any technical difficulties that occur (whether or not due to the TLD's operation), such as availability of accurate, consistent, and helpful Whois information;

f. The protection of domain-name holders from the effects of registry or registration-system failure, such as procedures for rapid restoration of services from escrowed data in the event of a system outage or failure; and

g. Provisions for orderly and reliable assignment of domain names during the initial period of the TLD's operation.

2. 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.

Recent experience in the introduction of new TLDs is limited in some respects. The current program of establishing new TLDs is intended to allow the Internet community to evaluate possible additions and enhancements to the DNS and possible methods of implementing them. Stated differently, the current program is intended to serve as a "proof of concept" for ways in which the DNS might evolve in the longer term.

Proposals should be chosen so as to promote effective evaluation of :

• the feasibilty and utility of different types of new TLDs,
• the effectiveness of different procedures for launching new TLDs,
• different policies under which the TLDs can be administered in the longer term,
• different operational models for the registry and registrar functions,
• different business and economic models under which TLDs can be operated;
• the market demand for different types of TLDs and DNS services; and
• different institutional structures for the formulation of registration and operation policies within the TLD.

This factor will be best served by applications that clearly articulate what concept or proposition the proposal would test, how the results of that test should be evaluated, and how the results of the evaluation would assist in the long-range management of the DNS.

3. The enhancement of competition for registration services.

As noted in the White Paper, market mechanisms that support competition and consumer choice should, where possible, drive the management of the DNS. One of ICANN's core principles is the encouragement of competition at both the registry and registrar levels. Though the market will be the ultimate arbiter of competitive merit, the limited number of new TLDs to be introduced at this time makes it appropriate to make a preliminary evaluation of competitive merit for the "proof of concept."

A proposal's contributions to enhancement of competition can take various forms, depending on the specifics of the proposal. Depending on the characteristics of the TLD proposed, the nature and degree of competition involved may vary. Proposals will be evaluated to determine whether they are responsive to the general goal of enhancing competition for registration services.

Some examples of competitive issues that may be considered in evaluating proposals are:

a. What prospects do the proposed TLD and registry have for effectively competing with other TLDs and registries (either pre-existing or introduced at the same time)? Are the proposed pricing and service levels likely to be competitive with other TLDs and operators having significant market shares? If effective marketing is necessary to make the TLD competitive, does the proposal adequately provide for that marketing? If the proposal is for an unrestricted TLD, are any features proposed to maximize the prospect that the TLD will be attractive to consumers as an alternative to .com?

b. Is the proposal particularly attractive to a significant sub-market in which it can compete effectively? Are distinctive services being proposed that will meet the needs of those not being served adequately by existing services?

c. Is there any significant competitive concern that the proposed TLD is likely to lead to lock-in of domain-name holders, so that inter-TLD competition is constrained? To the extent there is a concern about constrained competition, what measures are proposed or available to ensure competitive operation of the TLD (periodic rebidding of registry, etc.)?

d. What effect would the proposal have on registrar-level competition? Does the proposal restrict the ability of accredited registrars to offer registration services within the TLD on competitive terms? What mechanism is proposed for selecting registrars?

e. If accredited registrars are not permitted to offer registration services within the TLD on a competitive basis, are there other, effective mechanisms for providing competitive choices to domain-name holders seeking to register within the TLD?

f. Would the proposal advance competitive frontiers by introducing an innovative use of the DNS?

g. Would restrictions proposed for a restricted TLD impair (either in principle or in implementation) competition among potential registrants?

4. The enhancement of the utility of the DNS.

One motivation often cited for introducing new TLDs is that doing so might increase the utility of the DNS. Under this view, the appropriateness of adding new TLDs should be evaluated based on whether addition of the new TLDs:

• would sensibly add to the existing DNS hierarchy and
• would not create or add to confusion of Internet users in locating the Internet resources they seek.

At least the following considerations will be considered in this regard:

a. If the TLD is intended for a particular use or purpose, does the TLD label suggest that use? Is this true for a large portion of Internet users globally (i.e. in different languages)?

b. Is the proposed TLD semantically "far" from existing TLDs, so that confusion is avoided? (For example, TLD labels suggesting similar meanings might be more easily confused.) Is it phonetically distinct from existing TLDs? Meanings and pronunciations in different languages may be relevant to these inquiries.

c. Does the proposed TLD avoid names reserved by RFCs (or documents that are nearly RFCs), notably ".local" (from the HTTP State Management draft) and those names listed in RFC 2606.

d. In the case of a restricted TLD, is the restriction one that will assist users in remembering or locating domain names within the TLD? (E.g., users might conclude that "ford.car" is associated with the automobile company, not the modeling agency.)

5. The extent to which the proposal would meet previously unmet types of needs.

The DNS should meet a diversity of needs. Close examination will be given to whether submitted proposals exhibit a well-conceived plan, backed by sufficient resources, to meet presently unmet needs of the Internet community.

6. The extent to which the proposal would enhance the diversity of the DNS and of registration services generally.

One goal of introducing new TLDs should be to enhance the diversity of the DNS and the manner in which registration services are provided. In examining submitted proposals, consideration will be given to the diversity the proposal would add to the DNS. Among the diversity of proposals sought, ICANN hopes to receive proposals for fully open top level domains, restricted and chartered domains with limited scope, noncommercial domains, and personal domains. Diversity in business models and of geographic locations are also advantageous. (Note that this criterion must be judged based on the whole group of selected proposals, rather than any single proposal.)

7. The evaluation of delegation of policy-formulation functions for special-purpose TLDs to appropriate organizations.

As noted in the ICANN-staff-prepared document entitled "ICANN Yokohama Meeting Topic: Introduction of New Top-Level Domains," the DNS is a hierarchical system that facilitates delegation of policy-formulation authority for particular TLDs. In the context of unsponsored TLDs, this can appropriately be accomplished for many operational matters by giving the registry operator flexibility in the registry contract. For restricted TLDs, some have suggested a "sponsorship" model, in which policy-formulation responsibility for the TLD would be delegated to a sponsoring organization that allows participation of the affected segments of the relevant communities. Proposals will be analyzed to determine whether they offer the opportunity for meaningful, real-world evaluation of various structures for appropriate delegation of policy-formulation responsibilities, as well as evaluation of various allocations of policy-formulation responsibilities between ICANN and sponsoring organizations.

8. Appropriate protections of rights of others in connection with the operation of the TLD.

In introducing new TLDs, care should be taken to ensure that the rights of third parties are appropriately protected. Examples of matters to be examined in this regard include:

a. Does the proposal have a well-thought-out plan for allocation of names during the start-up phase of the TLD in a way that protects the legitimate interests of significant stakeholders, including existing domain-name holders, businesses with legally protected names, and others with which conflict is likely?

b. Does the proposal provide for a reasonably accessible and efficient mechanism for resolving domain-name disputes?

c. Has the proponent considered intellectual property interests or otherwise designed protections for third-party interests?

d. Does the proposal make adequate provision for Whois service that strikes an appropriate balance between providing information to the public regarding domain-name registrations in a convenient manner and offering mechanisms to preserve personal privacy?

e. Does the proposal incorporate policies that are likely to discourage abusive registration practices?

9. 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.

The ICANN staff intends to place significant emphasis on the completeness of the proposals and the extent to which they demonstrate that the applicant has a thorough understanding of what is involved, has carefully thought through all relevant issues, has realistically assessed the business, financial, technical, operational, and marketing requirements for implementing the proposal, has procured firm commitments for all necessary resources, and has formulated sound business and technical plans for executing the proposal. Applicants are strongly encouraged to retain well-qualified professional assistance (e.g., technical, engineering, financial, legal, marketing, and management professionals, as appropriate) in formulating their proposals. Proposals that are presented in a clear, substantive, detailed, and specific manner will be preferred.