Source: Tuesday, April 19th, 2011
http://blog.ud.com/2011/04/ben-crawford-why-trademark-owners-are-acquiring-their-brand-tlds-defensively/

Ben Crawford: Why Trademark Owners Are Acquiring Their .Brand TLDs "Defensively"

By: Ben Crawford, CEO of CentralNic

Although few have publicly announced their intentions at this stage, hundreds of forward-looking companies are planning to acquire .brand TLDs corresponding to their trademarks. It is usually the marketing and corporate budgets that will be footing the bill - as .brand TLDs will come into their own as online promotional tools and value-added assets. However, it is typically the fraud prevention and trademark protection executives who make the strongest case for .brands being a must-have investment.

Among the many "defensive" arguments for acquiring .brands, five common themes are:

1. "Don't look a gift horse in the mouth"

After trademark owners have funded literally years of input into the policy-making for the new TLDs to ensure an orderly roll-out of new domain extensions that respects trademarks, they could not countenance failing to take advantage of the opportunity to secure the .brands for their trademarks. Internet veterans (and their lawyers) still remember the pain and humiliation suffered by companies that failed to register the .com domains for their trademarks in the 1990s, and the resulting high legal and/or acquisition costs required to retrieve them.

2. The opportunity for a crime-free zone

A brand's own TLD represents a secure, online ecosystem that is completely free from concerns of infringement - free from knock-off sites, traffic diversion, cybersquatting, brand abuse, and the myriad of problems trademark owners endure in gTLD and ccTLD domains.

3. Domains that eliminate end-user confusion

Fraud-protection professionals dream of the day they can communicate the simple message: "If it doesn't end in .ourbrand, it's not a genuine 'our brand' website."

4. The power to control all uses of your domain

A .brand domain puts the brand owner in control of all uses of its domain. It can distribute domains to agents, distributors, retailers and other associated entities; and when those relationships end, it can simply revoke the names. This is a vast improvement over the current arrangement, where former agents have been known to keep domains containing the principal's brand and redirect traffic to other websites (the Uniform Dispute Resolution Procedure does not apply as the domain was not "registered in bad faith").

5. Mitigating the risk of others blocking your .brand

Another risk is that someone will register a "confusingly similar" TLD this round, and subsequently block you from ever having an opportunity to obtain your .brand. For instance, there is a United Airlines and multiple United Banks, but only one company will get .united. Additionally, if the Georgia Utilities Coordinating Council obtains .GUCC in this round, then Gucci Group will be prevented from obtaining their preferred .gucci domain extension.

With defensive arguments as compelling as these, the business case for obtaining a .brand TLD is often agreed upon before the conversation on making money from the .brand domain is even started.

Ben Crawford is the CEO of global domain name registry CentralNic and its recently-launched new gTLD service, dotBrand Solutions.