On June 20, 2011, the Internet Corporation for Assigned Names and Numbers (ICANN) voted to end restrictions on the registration of generic “top-level domain names” (gTLDs). The guidelines provided for a broad expansion of gTLDs for Internet addresses (those web addresses that end in .com .net .org .gov .biz and so on). There will soon be an infinite number of personalized top level domains. Businesses, organizations or individuals would be allowed to choose arbitrary top level domain names. Even non-Latin characters in Arabic, Chinese and other languages would eventually be allowed.
Thus, the current top level domains (.org .com .net and the others) will soon be joined by .microsoft .nordstroms .gasstation and so on. For example, if you purchase .peanutbutter you then become officially a “registrar” and you can actually allow your competitors use the domain as well. In addition to the cost of obtaining the right to become a “registrar” you then will have the cost of actually being a registrar: processing applications, dealing with domain name transfers and disputes and the like. But there will be a steep price to pay.
For $185,000 (plus $25,000 a year for renewal) you too can have your own generic top level domain. A common response has been to ask, “$185,000 to purchase a domain name? I can’t afford it!” If this were your response, you are definitely not alone.
So what is a restaurant or bar owner to do? Is there a need to pony up a six-digit figure to own your restaurant name as a top level domain? Unless you really want your own personalized corporate domain name for a web address, and you can afford it and you see a potential return on investment, it’s probably best to stick with the dot com. Let’s take a closer look at the situation.
Tackling the Task
New applications—which are estimated
to number under a thousand in the first year—will be examined by those administering the program. It is a process could take a year or more. While an applicant need not own a trademark for the new gTLD, trademark registrations—from all over the world—will be taken into account in the examination process.
Let’s say I have a restaurant called “Toasty Scott’s.” If I want to shell out $185,000 for the address greatfood@toastyscotts, I can certainly do so. But as a small restaurant with a website called www.toastyscotts.com, I provide my customers with everything they need to know about my operation. And if each day I continue to receive emails at my email address email@example.com, would there any reason I should spend $185,000 for the gTLD? For most small businesses, there probably isn’t. To do so might feed my vanity but not necessarily the restaurant’s bottom line.
What may be important, however, is to protect my trademark “Toasty Scott’s,” which I use for restaurant services. “Trademarks” are those words, logos or slogans which are used to identify the source of particular goods or services. If my trademark is used nationally, I can file an application to register it in the United States, with a $325 filing fee per class (different goods and services are placed in different classes). If my name or trademark is used locally, most states allow for the registration of trademarks within the state (and the filing fee is usually under $100). That price is definitely fair.
The good news is that trademark rights arise from actual usage: not from registration. Therefore if you have been using “Toasty Scott’s” as a restaurant name for the last ten years, you already have a trademark (whether I know it or not). In most cases, you might then stop someone from using the same or confusingly similar name within the geographic area wherein you are doing business. The significance of a federal trademark registration is that you have national priority for your trademark as of the date the application is filed.
From our perspective, the protection of your trademark is probably more important—and a lot more affordable—for restaurants and bars than dropping nearly $200,000 on a gTLD which may or may not bring a return on capital investment. So where do you spend your money? Spend it on building your business and perhaps on protecting your trademark rather than top level domains that may never live up to expectations.