Donuts.co, backed by more than $100 million in venture capital, is spending $56 million to bid for 307 of the 1,400 new generic top-level domain names, that will shape how the Web will soon evolve. Instead of .com, the new names include suffixes such as .book, .app and .law.
A lawyer who represents TLD holders is seeking to thwart Donuts’ efforts and is asking ICANN to investigate Donuts’ links to Demand Media Inc. That company’s clients have used domain names to masquerade as other businesses, the lawyer contends. They allege that the chief executive officer of Donuts.co, Paul Stahura, came from Demand Media, and Donuts has an arrangement to sell Demand Media 107 of its TLDs if it chooses to release them. However, Stahura has been with eNom.com, a registrar owned by Demand Media.
“Donuts and its key executives are, by ICANN’s established eligibility guidelines, unsuited and ineligible to participate,” Jeffrey Stoler, a lawyer with McCarter & English LLP, wrote in a July letter to ICANN.
Donuts, based in Bellevue, Washington, and Demand Media, are distinct companies with no equity relationship, and Donuts is “100 percent qualified” to be a TLD registry, said Brian Jacobs, founder and general partner of San Mateo, California- based Emergence Capital Partners, a Donuts backer.
The company is bidding for so many TLDs because domain-name expansion is long overdue, said Jonathon Nevett, one of Donuts’ four founders. “When you do something bold and large, sometimes you put a target on your back,” he said. “We’re going to run a clean, safe registry.” Donuts wants to build a “shopping mall” of domain names that offer breadth and depth to consumers, Nevett said.
Though dwarfed by Google, which is seeking to own and operate the .buy and .ads TLDs among others, Donuts’ 307 bids outnumber the search-engine giant’s 99 bids. Amazon.com is aiming for 76, based on a search of applicants’ e-mail addresses in ICANN’s registry of applicants published in June. Each application costs $185,000.
Nevett says about 140 Donuts bids are uncontested. So while Donuts will have to fight Amazon and seven others for control of .book, it faces no challengers to its ownership of .dentist or .mortgage.
Nevett said it’s unfair to criticize Donuts when the company has done nothing wrong.
“It’s kind of like being called a slum lord before you have an apartment to run,” he said. “If Demand thought it had a problem and wanted to create a new company to apply on its behalf, they wouldn’t apply for 26 on their own.”
Demand Media Executive Vice President Dave Panos also disputed Stoler’s complaint, calling it “rife with false statements and misinformation” in a letter to ICANN in September. Panos, reached by e-mail, declined to comment on the specific decisions that went against his company.
Donuts won’t allow site operators that use its domain names to practice cybersquatting or phishing, where sites try to steal Web users’ information, Nevett said.
“If there’s cybersquatting or phishing, we’ll certainly take them down,” he said.
It seems that the complainers took their cue from political ads. If you have nothing positive to say about yourself or your product, then just knock down the other guy.
Thanks to Hugo Miller and Bloomberg, and
Thanks for “listening”
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