Top 10 Biggest Domain Stories of 2012 and Predictions for 2013

So my prediction from last year that ICANN will open the new gTLD application period without any glitches” could not have been more wrong. And yes – I  actually used the word ‘glitches’.

That said I was correct in saying that many would be surprised by the number of new gTLD applications submitted. Unfortunately I was also correct in saying that we would continue to see security breaches at both the Registry and Registrar levels with the sophistication of these attacks beginning to increase.

Regardless of my crystal-ball gazing skills it’s been another incredibly eventful year and below are the Top 10 Domain Stories from 2012.

Number 10 – “Reveal Day” Surprises Revealed

In June of 2012 ICANN announced that they had received 1930 New gTLD applications from 60 countries for 1 408 unique strings. Of the 1 930 applications received .Brands accounted for 652 of them. In addition to the .Brand TLDs there were also 84 “Community-Based” TLDs some of which were also designated as geographical names. In addition there were 66 geographical names (most of which are city TLDs). Only 116 applications of the 1930 applications utilized non-Latin character sets. Interesting note – there were 1 179 uncontested applications and 751 contested applications representing 230 unique strings.

Number 9 – Domain  Market Grows by 12%

According to Verisign’s “October 2012 Domain Name Industry Brief” by the end of the second quarter of 2012 more than 240 million registrations were in existence. And while .COM and .NET registrations grew by a respectable 7.8% YOY ccTLDs grew by a whopping 18.5% YOY.

Number 8 – DNSSEC Adoption Extremely Low

Amid much fanfare .COM deployed DNSSEC support in the first quarter of 2011. Despite the fact that a number of leading Registrars have deployed support for DNSSEC adoption by corporate America has been extremely low. In fact some figures show DNSSEC adoption rates of less than 1% for major US corporations.

Number 7 – Registration of ccIDNs by Corporate America Slows

While there were some reports that County-Code Internationalized Domains (ccIDNs) are becoming popular within their respective countries registrations by brand owners in North America have been surprisingly low. Given that there are now more than 3 dozen ccIDN extensions the resulting lack of interest may simply be the result of registration fatigue.

Number 6 – IANA Contract Renewed

While the US Government no longer has direct oversight of ICANN they still hold the contract for the technical coordination of the Internet with IANA (Internet Assigned Numbers Authority) and in November 2011 NTIA (National Telecommunications & Information Administration) issued an RFP for the IANA functions. However on March 10 2012 NTIA withdrew the RFP due to the fact that there were “no proposals that met the requirements requested by the global community.” Interestingly enough on April 16 2012 the RFP was reissued and on July 2 2012 the contract was awarded once again to ICANN.

Number 5 – Hacks and Outages Continue

More so than ever Registries and Registrars continue to fall victim to security breaches. Even as many Registries were implementing additional security protocols vulnerabilities at the .IE .PK and .RO Registries were exposed resulting in redirected domain names. A number of Registrars suffered breaches as well via social engineering and SQL-injection attacks in 2012 but MarkMonitor systems were not impacted due to our focus on security. Finally the industry’s largest Registrar suffered a major outage due to their own internal system failure.

Number 4 – Secondary Market Mixed

Previous years saw seven-figure domain deals but in 2012 the numbers of high-end purchases have declined. The domainer-to-domainer market also appears to be softening.  However the market for desirable domains remains strong despite the anticipated launch of new gTLDs next year.

Number 3 – Whois Remains a Hot Topic

In the past year there have been a number of Whois initiatives including the completion of ICANN’s Whois Policy Review Team Final Report which recommended making Whois a strategic priority creating a single policy data accuracy improvements privacy / proxy requirements and IDN support. Work on the soon-to-be revised Registrar Accreditation Agreement will likely also result in some notion of Whois verification / validation. Moreover policy development work requiring that all Registries provide Thick Whois is now underway. Finally the development of new technical protocols to support non-Latin character sets and new terminology has been completed.  And to top it all off the ICANN Board recently directed ICANN’s CEO to “launch a new effort to re-examine the purpose of collecting maintaining and providing access to generic Top-Level Domain (gTLD) registration data.”

Number 2 – Significant Organizational Changes at ICANN Shake Things Up

Many were surprised by the resignations of both Michael Salazar ICANN’s New gTLD Program Director earlier this year and more recently by Kurt Pritz ICANN’s Chief Strategy Officer. Of course the biggest change by far has been the hiring of Fadi Chehade ICANN’s new CEO. Chehade has described his objectives for the organization which include 1) affirmation of purpose 2) operational excellence 3) internationalization and 4) evolution of the multi-stakeholder model on which ICANN is built. He has also described significant organizational changes to ICANN leadership and staff to support public engagement technical functions registry and registrar services contractual compliance communications and stakeholder and governance support.

Number 1 – New gTLDs Troubling

A survey conducted earlier this year of MarkMonitor clients revealed that New gTLDs are of significant concern to large corporations. Fifty-five percent of the respondents stated that New gTLDs will create opportunities for brand harm or confusion. And just over half stated that their online policing efforts will need to increase. Interestingly enough about 75% of the respondents do not expect to use new gTLDs for core websites and over a third are not sure what to do with their domain portfolios in response to new gTLDs.

What Can We Expect in 2013?

With the launch of New gTLD Registries expected next year the real work will soon begin. Starting next year companies will need to identify and submit their marks to the Trademark Clearinghouse determine when and where to register domains as new gTLD Registries launch and then actively begin policing an ever-expanding namespace. New gTLD Registries will be working through the processes of responding to Clarifying Questions contract negotiations pre-delegation testing and (in many cases) developing their Registrar networks. Registrars will be busy selecting and implementing the New gTLDs they will offer to their customers.

Unfortunately as predicted in previous years I believe that we will continue to see Registrar and Registry security breaches.  The silver lining is that for those that have been impacted previously we will see a concerted effort to harden security.

While the coming year will be an exciting one for sure the complexity it will bring is unprecedented. I for one can’t wait to see how it all plays out.