A year in domains, 2020 and beyond

2020 Industry Statistics

The Domain Name System (DNS) as a whole continues to grow.  As reported in Verisign's Domain Name Industry Brief, Q3 of 2020 closed with some 370 million registered domain names across all Top Level Domains (TLDs), representing an increase in global domain name registrations of approximately 10.8 million, or 3 percent, year over year.  Of these 370 million registered domain names, .COM remains a clear market leader in the generic Top-Level Domain (gTLD) space, with some 150 million registrations.

Total registrations in the new gTLD space rose, with some 30.2 million domain names at Q3, 2020, representing approximately 8.1 percent of global domain name registrations.  The following top 10 new gTLDs account for approximately 61 percent of all new gTLD domain name registrations:  .ICU, .XYZ, .TOP, .SITE, .ONLINE, .WANG, .CLUB, .VIP, .APP and .SHOP.  

Registrations under country code Top Level Domains (ccTLDs) have also seen a slight increase, with 160.6 million domain names registered across all ccTLDs at the end of Q3 of 2020, representing an increase of 1.9 million domain names (1.2 percent growth) year over year.  The top five ccTLDs by zone size are: .TK (Tokelau) with 27.5 million domain names, .CN (China) with 24.7 million, .DE (Germany) with 16.6 million, .UK (United Kingdom) with 10.8 million and .NL (the Netherlands) with 6.0 million.  In 2020, the top 10 ccTLDs comprised 66 percent of all ccTLD domain name registrations.

WIPO and the UDRP

2020 saw the World Intellectual Property Organization (WIPO) pass a major milestone of registering its 50,000th "cybersquatting" case.  At the core of WIPO's domain name dispute resolution services, the Uniform Domain, applicable to all gTLDs, remains the preferred choice for trade mark owners when it comes to enforcing their rights online.  In its 21 years of operation, WIPO has administered UDRP based proceedings covering almost 91,000 domain names, involving parties from over 180 countries.  More and more ccTLDs continue to adopt the UDRP, or UDRP-like dispute resolution policies, including .CH (Switzerland) and .IO (British Indian Ocean Territory) in 2020.  

As in recent years, the number of Complaints filed before WIPO under the UDRP and related domain name dispute resolution policies has continued to rise, with 2,755 cases in 2015, 3,036 in 2016, 3,074 in 2017, 3,253 in 2018, and 3,693 in 2019.  Cases in 2020 have already surpassed 2019's total, with 3,793 cases as at 30 November 2020, representing an 11 percent increase over the same period during 2019. 

The increase in filing is due, in part to the COVID-19 pandemic, which appears to have fuelled cybersquatting cases.  "With a greater number of people spending more time online during the pandemic, cybersquatters are finding an increasingly target-rich environment.  Rights owners, meantime, are stepping up their brand enforcement on the Internet as they further shift to marketing and selling online" commented Mr. Erik Wilbers, Director of the WIPO Arbitration and Mediation Center.  

2020 ICANN Meetings

Three ICANN meetings were scheduled for 2020:

•           Cancún, Mexico (March 2020)

•           Kuala Lumpur, Malaysia (June 2020)

•           Hamburg, Germany (October 2020)

Due to international travel being largely curtailed as a result of the COVID-19 pandemic, and citing public health concerns, all three meetings were moved online, with participation in meetings streamed via teleconference. 

A number of significant policy matters are the subject of ongoing development at ICANN meetings, which are highlighted in the following sections.

The EU General Data Protection Regulation (GDPR) and its Impact on WhoIs Data

The European Union General Data Protection Regulation (GDPR) became directly applicable across the EU on 25 May 2018.  Since then, it has had substantial impact on the DNS, particularly in relation to the public availability of WhoIs data.  In practical terms, much of the publicly-available WhoIs information has been removed or is now masked, making it increasingly challenging for law enforcement and IP rights holders to bring legal actions. 

In order to mitigate the impact of the GDPR, in May 2018, the ICANN Board of Directors (ICANN Board) adopted the so called "Temporary Specification for gTLD Registration Data" (or "Temp Spec"), as an emergency measure.  The Temp Spec expired in May 2019, at which point the ICANN Board approved a further Interim Registration Data Policy for gTLDs, which preserves the mechanisms for access to WhoIs data, as set out in the Temp Spec. 

ICANN is now engaged in an Expedited Policy Development Process (EPDP).  Phase 1 of the EPDP's work concluded in March 2019, with the submission of a Final Report containing 29 recommendations addressing various WhoIs-related issues, including:  purposes for processing data, details on the collection and transfer of specific data elements, as well as the redaction and display of specific data elements.  Phase 2 of the EPDP is focused on developing policy recommendations for the circumstances in which registration data may be disclosed to third-parties.  In July 2020, the EPDP team delivered its Phase 2 Final Report to the Generic Names Supporting Organization (GNSO), for its consideration.  In September 2020, the GNSO adopted the EPDP team's Phase 2 Final Report.  The model proposed by the EPDP is that of a System for Standardized Access/Disclosure (SSAD), which is built on accredited access to registrant data, via both automated and manually-reviewed means.  As noted by the GNSO Council, a number of issues remain outstanding, including the access to data of legal versus natural persons, whether it is feasible for unique contacts to have a uniform anonymized email address, and data accuracy.  The ICANN Board is now working together with the GNSO to determine the best way forward, including a review of the operational design to determine the financial viability of such a system.  At the same time ICANN Org continues to seek guidance from the European Data Protection Board on those outstanding issues mentioned above.     

As the year draws to a close, there is hope that the recently adopted proposal for a revised Directive on Security of Network and Information Systems (NIS 2 Directive) may help strike the right balance at ICANN and with respect to ICANN's policies.  Defining an EU wide public interest in WHOIS data to justify it (or at least a subset such as registrant name and verified email address and possibly postal address) remaining publicly accessible would be of huge benefit to law enforcement and IP rights owners.  As would be clarity on what amounts to "legitimate interests" that would justify the disclosure of WHOIS data that constitutes personal data under 6(1)(f) of the GDPR.

ICANN's Review of Rights Protection Mechanisms

Since 2016, ICANN has been engaged in a systematic review of all existing Rights Protection Mechanisms (RPMs) applicable to domain names registered in the gTLD space.  This review is also being carried out in phases.  Phase 1 of the review is focused on RPMs developed specifically for the new gTLD program, including the mandatory sunrise registration period, the Trademark Clearinghouse (TMCH), the Uniform Rapid Suspension (URS), and the Trademark Post-Delegation Dispute Resolution Procedure (TM-PDDRP). 

In March 2020, the GNSO Policy Development Process Working Group submitted its Phase 1 Initial Report for public comment.  From May 2020, the Working Group conducted a review of the public comments received from some 55 contributors.  Following deliberations on the points raised, on the working group has now submitted its Phase 1 Final Report to the GNSO Council for its consideration.  If approved by the GNSO Council, the Final Report will then be forwarded to the ICANN Board for its consideration and potential action. 

Phase 2 will focus on the UDRP, which has been an ICANN Consensus Policy since 1999.   

DNS Abuse

Following extensive discussions at ICANN meetings in 2019, the topic of DNS abuse remained a central issue at ICANN meetings in 2020. 

Despite a growing perspective that the mitigation of DNS abuse is a shared goal, there is still no Community wide definition of what constitutes DNS abuse.  Efforts to lay down a foundation of what amounts to DNS abuse have been made in such documents as the DNS Abuse Framework, which defines DNS abuse as behaviour that falls within five broad categories of harmful activity, insofar as they intersect with the DNS, namely malware, phishing, pharming, botnets, and spam.  However, adherence to anti-abuse measures are voluntary, and rely on the willingness of signatories to such documents to take action, and while ICANN Compliance is vested with the authority to audit registries and registrars, its application of that authority has thus far been limited.

Certain actors have argued that abuse insofar as website content is concerned falls outside of ICANN's remit as being responsible for the technical governance of the Internet (i.e., names and numbers only), while others including IP rights holders and law enforcement agencies continue to lobby in favour of specific policy developments that, in certain limited circumstances, would also address website content (such as clear cases of counterfeiting, or the illegal online sale of opioids).     

Next Round of New gTLDs

Since the conception of the new gTLD program in 2008, and its formal approval in 2011, over 1,200 new gTLDs (of some 1,900 unique applications) have been delegated into the Root Zone of the Internet. 

The first round of delegations has effectively ended, with a small number of outliers still pending delegation (such as .HOTEL).  The new gTLD program has presented many new opportunities for brand owners to promote their brands online.  Indeed we have seen over 340 brands now launch their own new gTLDs.  At the same time, the new gTLD program has not been without challenges, having provided new opportunities for cybersquatting, fraud, and other forms of illicit behaviour. 

The New gTLD Subsequent Procedures Policy Development Process Working Group (SubPro PDP WG) is tasked with evaluating the experiences of applicants from the first round, in order to determine which policy changes should be implemented for future rounds or a future permanent opening of new gTLD applications. 

In August 2020, the SubPro PDP WG submitted its Draft Final Report with its policy recommendations for public comment.  The Working Group is expected to deliver its Final Report to the GNSO Council in January 2021. 

We expect the opening of a new round of applications no earlier than 2022, a full 10 years after the 2012 round.  Even with an opening in 2022 that would likely mean delegation into the route aka "live" TLDs in 2023 at the earliest. 

Looking Ahead

The impact of the COVID-19 pandemic has seen a sharp increase in online activity, in both the public and private sectors, amongst consumers and business alike.  The provision of a safe and stable DNS is of critical importance, as the economy continues to shift online.  At the same time, as noted above, COVID-19 has also seen a surge in malicious behaviours, including phishing, counterfeit goods, impersonation, identity theft, and hacking.  As DNS abuse and cybersecurity threats increase, brand owners are being forced to adjust their enforcement strategies to protect both their brands and their consumers. 

ICANN's policy developments are expected to continue in 2021.  We welcome the ICANN Board's engagement on the key issues outlined above.  Meetings are scheduled to take place in Cancún, The Hague, and Seattle, and while at this stage it seems likely that attendance will be virtual only, we very much look forward to seeing all of our friends and colleagues in the near future.

Authored by David Taylor

Anchovy® - Global Domain Name and Internet Governance

Hogan Lovells offers a unique, comprehensive and centralized Paris-based online brand protection service called Anchovy® for global domain name strategy, portfolio management and global enforcement.

We are accredited registrars with many country-specific Registries worldwide and the only law firm to be an accredited ICANN registrar.

We also specialise in all aspects of the ICANN new generic Top Level Domain (gTLD) process and we are an agent for the Trademark Clearinghouse. As the global Domain Name System undergoes an unprecedented expansion, brand owners must revise their online protection strategies and we are ideally placed to guide them. We are also frequently brought in to advise on cybersecurity issues arising across the globe.

For earlier Anchovy News publications, please visit our Domain Names practice page.