Restaurants have worked hard to create websites that represent their brands and ultimately boost traffic, fill tables and increase sales. Protecting the brand online could get much more expensive this year, as the entity that controls Internet addresses starts taking applications for domain names beyond the typical .com or .org.
The Internet Corporation for Assigned Names and Numbers said additional generic top-level domains will spur global innovation online, but restaurants, retailers and other industries are worried about the hefty price tag that comes with protecting brands from online cybersquatters. It costs $185,000 to apply for a domain name, and many come with an annual renewal fee of $25,000.
The cost is bad enough for large chains, but “for the hundreds of thousands of smaller restaurant operators who depend on the Internet to communicate with guests, the costs and confusion could be insurmountable,” National Restaurant Association executive Scott DeFife said during a congressional hearing last month.
In QSR magazine, a few restaurant executives, including Salad President Paul Steck, said restaurant companies stand to lose substantial value online in their brand presence, search engine optimization and brand growth. “If this plan unfolds, small, growing corporations, if not all companies, will be deprived of our ability to protect our brands on the Internet,” Steck said.
Opposition by industry, including restaurants, has support in Congress. Senate Commerce, Science and Transportation Committee Chairman Jay Rockefeller wrote a letter urging Commerce Secretary John Bryson and National Telecommunications and Information Administration chief Lawrence Strickling to ask ICANN to re-evaluate the issue given the potentially huge cost to businesses, consumers and nonprofits in protecting their brands. “Under the current plan, companies and non-profit organizations will be compelled to ‘defensively’ register thousands of second-level domains and hundreds of gTLDs to protect their brands and trademarks,” Rockefeller wrote.
In a letter to The Washington Post, ICANN President Rod Beckstrom sought to ease such concerns, saying the agency spent years studying all aspects of the issue and that the system comes with rigorous evaluation that includes criminal-background checks and the ability to reject applicants with a history of cybersquatting or cybercrime. Still, groups including the nonprofit Coalition Against Domain Name Abuse said the effort doesn’t go far enough, calling for additional protection.
Are you worried about the change? Tell us in the comments.
Image credit: iStockphoto
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For sure it is necessary for any restaurant to have a domain name strategy. If you analyze your existing domain portfolio I'm sure that you can find useless domains, expire them and have a better budget for the new top level domains. While there will be several hundred new top level domains, there will be plenty of these TLDs which are not relevant for your business (.cars, .berlin etc), and which should not confuse your customers.
$185K to register!? and $25K a year to renew…is insane!
-what stand-alone restaurants can afford that??
The $185K is the application fee (to ICANN) to run a new domain extension, like .NGO, .GREEN, .PARIS, not to register a single domain name. In other words, your web address will still cost whatever the registrars charge from them, say from $10-$30.
I know one of the restaurant owner who bought just their domain name for £400, while the domain name just cost £5.99 for two years. Domain name will be more in demand and names will sell like the value of property. Nice article and good read.
If domain registrations cost a lot more, that would discourage cyber-squatters – people and companies that register hundreds and thousands of domains in hopes of reselling some of them at a huge profit. If a domain would cost $500-1000/year to register, many people/companies might pare down to just one or two and speculators would probably find it too expensive to register every domain they could. Another option is to simply limit the number of domains each legal entity could register. Or would that be a "freedom of speech" issue?