Last week, the Internet Corporation for Assigned Names and Numbers (ICANN), the California-based non-profit corporation charged with the principal responsibility for maintaining the Internet’s domain name system, revealed that it has received nearly 2,000 applications for new domain name extensions. While many applications may be abandoned or face objections that stall their approval, my weekly technology law column (Toronto Star version, homepage version) notes it seems certain that there will be hundreds of new domain name extensions in the not-too-distant future, a change that will fundamentally reshape the way we think about domain names.

The proposed extensions include hundreds of brands such as dot-NFL or dot-Gucci, new geographic extensions such dot-Brussels or dot-Quebec, and a myriad of generic extensions featuring everything from dot-app (the most popular application with 12 competing bids) to dot-wedding.

The new system faced surprising criticism from some veteran Internet watchers, who argued that the addition of hundreds of new domain name extensions was a virtual land grab, a train wreck, unnecessary, and not particularly innovative.  

The claims that there is no need or interest in hundreds of new domain name extensions may be correct – the additions of domain extensions such as dot-travel in 2005 hardly became a household name – but it might not. Just as when some critics asked why anyone would need an iPad that was neither a smartphone nor a laptop computer, useful innovation is often hard to spot at first glance.

The real question is who should decide whether new domain name extensions can be created. The first round of domain name extensions such as dot-com or dot-net were largely a historical accident based on the early days of the domain name system.  The more recent additions have generally failed to inspire, but that may be a function of the bureaucratic trade-offs that led to new domain extensions least likely to offend.

The new system throws the issue to the open market, allowing anyone with sufficient resources to create their own domain name extension. Some will succeed, others will fail, yet a market-oriented approach seems preferable to one managed through bureaucratic wrangling.

In fact, the innovation may be less about the extensions and more in the way they are used. For example, Rogers applied for extensions of several of its brands, including dot-rogers, dot-fido and dot-chatr. It has said little about what it intends to do with them, but perhaps it will offer free domains to its customers with the hope that the personalized domain name for wireless customers will make them less likely to switch to competitors. The same may be true for the NBA or MLB, who may offer fans their own domain as a way to stay connected to the sport.

As with any “gold rush”, it will take years to determine the winners and losers. Assuming the new extensions do not harm the technical architecture that underlies the Internet system (most experts say it does not), there is little reason to object to more consumer choice and the prospect of a new layer of creativity in the way businesses and individuals present themselves online.

While the new domain name extensions may raise few technical concerns, there is the potential for competitive misuse. For example, the Canadian Real Estate Association has been under considerable pressure from the Competition Bureau over access to real estate listings known as the multiple listings service or MLS.  CREA submitted an application for dot-mls, raising questions about whether it could use the domain name extension in an exclusionary manner that harms competition.

Similarly, the National Association of Boards of Pharmacy is seeking dot-pharmacy, raising questions about whether it hopes to use the domain name extension to impose a regulatory model on Internet-based pharmacies.

Another concern is hoarding of generic extensions with no plans to make domains available to the public. For example, Amazon has applied for 76 domain name extensions yet has disclosed that no domains will be made available to the public.

The use of domain name extensions to “regulate” or foreclose public registrations raises real concerns that should be addressed before granting final approvals. For hundreds of others, the market-based approach that moves away from ICANN picking winners and losers is a step in the right direction.