[gnso-rpm-wg] A Brave New World Without Sunrises or the TMCH

[George Kirikos]

Hi folks,

(changing the subject accordingly)

On Thu, Apr 13, 2017 at 2:15 PM, J. Scott Evans via gnso-rpm-wg
<gnso-rpm-wg at icann.org> wrote:
> I think all of this is a huge red herring. If my memory serves me, there
> have only been about 130 Sunrise Registrations. That is a very small number
> when compared to the number of second level domains registered in the new
> TLDs. I think it is safe to assume that there has been some gaming. We don’t
> need to do an exhaustive investigation. What we need to do is look at
> reasonable solutions to the gaming problem. I have not seen any proposals
> for you on how to handle the problem. We need to close down this
> unproductive discussion and move on to finding solutions to the problem of
> gaming.

These numbers stand for the proposition that the sunrise period should
be entirely eliminated, given that folks concede it "is a very small
number", and thus is not conferring many benefits to those who
register them defensively, since they're not utilizing the procedure.
And the gaming that does exist is amplified, since it means that a
higher percentage of the sunrise registrations are gamed. It could be
that 30%, or even 50% of sunrise registrations are gamed, given the
various blog posts and examples provided to this mailing list already
(and how many others might exist "under the radar", that some folks
are trying to keep hidden due to the lack of transparency of the
TMCH).

Consider a "thought experiment" as to what would happen if Sunrise
registrations and the TMCH were eliminated. Those 130 registrations
would shift to either landrush or to general availability.

For those who are "gaming" the sunrise, they'd now be on an equal
footing as everyone else.

For those legitimate TM holders, they can either register in landrush
(or general availability), *or* they have curative rights protection
mechanisms (courts, cease and desist letters, UDRP, URS, etc.) *if*
domains which conflict with their TM rights are registered by someone
else and misused.

I could even support a "hybrid" (horse trading, as Phil called it
yesterday) model, where landrush imposed **additional burdens** on
registrants, e.g. paying costs if they lose a UDRP), but then that
extra burden is eliminated during general availability (as it is
today). This way, TM holders and legitimate end users who don't have
trademarks but have non-conflicting uses, etc. are on equal footing
during a landrush.

I think many people are overly protective of the TMCH & sunrise period
not because it's "working", but because it's an opportunity for extra
consulting, revenue streams, etc. e.g. lawyers can tell their clients
"get registered", and they can make money from the filing fees, etc.
There's a huge amount of money being wasted, in my voice, that can be
redirected to other things (like curative rights, better education,
etc.).

Suppose that of the 130 sunrise registrations, half of them got
registered by legitimate TM owners in landrush. Of the 65 that were
registered by someone else, how many of those would actually be cases
of cybersquatting? I would suggest it's a small number, given the
overall stats of UDRPs relative to registrations. Even if it was a
massive 2% (actual percentage is much, much lower), that might mean 1
extra UDRP per TLD? With 1000+ TLDs launched over 4 years, that might
mean an extra 250 UDRPs per year. That's a relatively negligible
amount.

If the "all-in" costs of those 250 UDRPs (lawyers fees + filing fees)
is $5,000 or so, that's $1.25 million/yr.

TMCH revenues, by contrast, are on the order of $5 million/yr for
Deloitte. And perhaps another $5 million or more per year for all the
TM agents, etc. filing on behalf of clients. Let's call it $10
million+ for TMCH-related fees on those using that system.

Trading $10 million/yr in "preventive" costs for $1.25 million/yr in
"enforcement" costs -- that's a no-brainer for TM holders.

And if, as I argued above, if some of those UDRP enforcement costs are
shifted to the losers (for landrush registrations), then the economics
are even that much stronger for the elimination of the sunrise period
(since that $1.25 million becomes even lower, due to cost recovery).

And of course, a system that has no landrush definitely benefits
ordinary registrants and prospective registrants who simply want a
"good" name, or at least a fair chance at one, and don't want to see
"THE" or "FLOWERS" or "HOTEL" or all of the other common words being
grabbed in sunrise.

Processes would be simplified for registry operators and registrars,
if sunrises and TMCH were eliminated, which saves them money (which
gets passed along as savings for consumers). TLDs would launch faster,
too. The best second-level strings would be "spread around" more,
which is probably a good thing (except to some who feel, wrongly, that
they have exclusive rights to common dictionary terms, etc., which is
not something the law supports).

So, I hope folks will give serious consideration to what would happen
if sunrise was completely eliminated. With a few small tweaks (as
noted above), it could be much better than we have for most people
(except for those exploiting the current system).

Sincerely,

George Kirikos
416-588-0269
http://www.leap.com/

P.S. I know I've not written much above about the TM Claims notice
aspect of the TMCH, but those are obviously have a chilling effect,
with a 96%+ abandonment rate of registrations. A 90 day claims notice,
which determined cybersquatters are going to ignore anyway, simply
confuses legitimate registrants. The "ongoing notifications service"
aspect of the TMCH is available through other companies, e.g.
DomainTools or other domain monitoring services.

P.P.S. Some might argue that you can never collect $5K from
registrants if they lose a UDRP. Shift some of that to the registrar,
who can then police their own clients, a sort of "know your client"
rule for those participating in landrushes. One can even envision a
system of insurance, so that those who are involved in risky domain
name registrations pay higher "insurance" (to indemnify their
registrars) than less risky registrants who don't engage in
cybersquatting. Or require a deposit at the start of the UDRP process
(if one side doesn't post a deposit, they'd be in default).