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<div>Thanks to Chris Wilson and Cecilia Smith for drafting our comment on <span style="font-family: Calibri; font-size: medium;">Phase 1 Assessment of the Competitive Effects Associated with the new gTLD Program (attached and below)</span></div>
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<div><span style="font-size: medium; font-family: Calibri;">The Business Constituency (BC) appreciates the opportunity to comment on Phase 1 Assessment of the Competitive Effects Associated with the new gTLD Program. </span></div>
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<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3"> </font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3">Background:<o:p></o:p></font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3"><br>
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<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3">The “Phase 1 Assessment” of the Competitive Effects Associated with the new gTLD Program establishes the baseline of the marketplace for domain names both prior to and the initial months
following the New gTLD Program. A subsequent “Phase 2 Assessment” will assess the extent to which the New gTLD Program has affected competition in the marketplace in the coming year. In the Phase 1 Assessment Report, pricing and registration volume data
from a sample of legacy gTLDs, new gTLDs and ccTLDs were considered in this report.<o:p></o:p></font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3"> </font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3">The report includes several major analyses of pricing, including in the wholesale and retail markets, as well as Sunrise period pricing.<o:p></o:p></font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3"> </font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3">On average, the wholesale price of a new gTLDs is higher than that of a legacy gTLDs, which could be largely due to the price restrictions placed upon legacy TLDs. There is greater wholesale
price dispersion among new gTLDs.<o:p></o:p></font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3"> </font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3">Requests for current and historical data were sent the all 54 registrars in the original sample, yet only 6 registrars (all from the Asia Pacific region), provided some form of historical
data. These responsive registrars accounted for only 14% of registration volume of new gTLDs being sampled and did not provide any regional geographic variation. As a result, some pricing information was collected from publicly-available websites such as
the registrars’ websites.<o:p></o:p></font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3"> </font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3">BC Comments:<o:p></o:p></font></span></p>
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<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3">This Phase I report is a helpful beginning to a much-needed comprehensive analysis of the domain name market in the wake of the expansion of gTLDs. As the report indicates and the BC agrees,
a competitive effects analysis of the new gTLD Program is not feasible at this time as the analysis lacked a rich set of data to review. More thorough analysis is needed and requires detailed transaction-level data from registries, registrars, resellers,
and other market-makers. The BC is hopeful that such information will be provided, taking into consideration the confidentially and proprietary nature of the information.
<o:p></o:p></font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3"> </font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3">Additional data points should be added to capture additional fees by registries and registrars beyond the wholesale, retail, and Sunrise period pricing. For example, the Donuts Registry
offers an “Early Access Program” (EAP), which allows consumers to purchase a domain prior to general availability with tiered fees. These one-time fees can typically reach over $10,000 in additional to the registration fees. Premium pricing is another fee
that is added on to the cost of a domain registration fee. These fees are not always publicly available and are at the discretion of the registry operators and can be in addition to the EAP and registration fees. <o:p></o:p></font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3"> </font></span></p>
<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3">There would be great value in charting the percentage of cost and registration made during the Sunrise period again general availability to evaluate if the increases in this report are
due largely to defensive registrations by trademark holders. As noted by the Analysis Group who produced this report, when a firm engages in price competition, typically consumers tend to benefit from lowering prices. Understanding that there are multiple
factors that affect pricing and competition, the above would provide greater insight in the next phase.</font><span style="font-size: 11pt;"><o:p></o:p></span></span></p>
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<p class="MsoNormal"><span style="font-family: Calibri;"><font size="3">This comment was drafted by Chris Wilson and Cecilia Smith, and was approved in accord with the BC Charter.</font></span></p>
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