Assessing legal risks of closed generic top-level domains

Since the recent introduction of new generic top-level domains (TLDs), a variety of new Internet domain names have become available for registration. These include new domain endings such as <.berlin>, <.club> or <.global>, which anyone can purchase. At the same time, an entire class of new TLD applications has arguably failed. Several well-known corporations applied for „closed generic TLDs‟. The applicants wanted to reserve these generic words for internal use, thus disallowing third party registrations. Examples included <.beauty> (L‟Oreal), <.ketchup> (Heinz), <.blog> (Google) and <.book> (Amazon). These applications have either been withdrawn or will be converted into open TLDs, largely as a consequence of changes or clarifications in rules for TLDs published by the Internet Corporation for Assigned Names and Numbers (ICANN). This article advances two arguments. The first argument is that these applications for closed generic TLDS were fairly risky because they implied some level of legal risk for the applicants. The failures indicate that some risks have now materialized. The article also discusses what methods, if any, TLD applicants could have used to identify and manage such risks. The second argument put forth is that standard risk management techniques can and should be applied to the analysis of legal risk.