2013-Chapter 1 Internet Domain Name Registration Services Abstract

During the past year (from July 2012 to June 2013), several subtle but far-reaching changes have occurred in Taiwan's domain name market. First of all, new generic top-level domains (gTLD) became available in Taiwan without much fanfare. In addition to four organizations submitting applications for them, Trademark Clearinghouse (TMCH), a complementary brand protection service, was also introduced to Taiwan. The revolutionary domain name applications and protection mechanism are expected to have profound implications. Secondly, major domain name-based marketing activities finally appeared in Taiwan, marking a significant milestone in the domain name industry. Finally, the number of domain name-related cross-border lawsuits and reacquisitions of domain names by Taiwanese enterprises has reached a new high, which indicates that domain names are increasingly valued by Taiwanese businesses.


According to the historical analysis by ICANN, although domain names first appeared as a networking tool in 1985, after almost three decades of development, its original identification purposes have evolved to take on the functions of Internet marketing as well as the online extension of existing brands. Different applications have even found their way into investment targets and integrated services. In fact, domain names are characterized by the presence of similar but not identical names, work on a first-come first serve basis, have the advantage of being search-enabled, and lack a unified, global legal jurisdiction. This has resulted in wide variety in domain names, making them no longer simply a identification mechanism or trademark, but also a source for services with unlimited innovation and growth. However, a whole host of problems, such as technological issues, Internet scams, trademark infringements, and hoarding and speculation, have resulted due to the fact that the domain name system is overly complicated and powerful, and lacks a set of globally unified governing regulations, not to mention its status as a tool developed by computer professionals in a very specialized field.

Domain name coverage has also expanded from the earliest generic top-level domains (gTLDs) managed by ICANN to country code top-level domains (ccTLDs), which are authorized and operated by governments around the world, and the latest development, new gTLDs, which are available for registration by any organization or corporation and managed solely by ICANN. In practice, although ICANN is registered as a nonprofit organization in the United States, it is actually the highest governing body in charge of global domain names and IP addresses. Only when ICANN is functioning normally can domain names and IP operate and be resolved properly, which ensures the smooth operation of the Internet, and the continuation of our indispensable and modern online lifestyle. Therefore, the importance of ICANN to humankind has propelled the organization almost to the status of a United Nations institution, and it deserves our attention.
In addition, the total volume of the domain name market continues to grow globally. It is estimated that all segments have seen growth above 10%. For the ".tw " domain, apart from about 100,000 newly registered domain names from specialized applications, the total number of domain names for which users have paid the registration fees has not increased significantly. Rather, the growth of offshore ccTLD registrations by Taiwanese enterprises has been considerable. This indicates that the momentum of investment by Taiwanese corporations around the world has not diminished, and companies are beginning to realize the power of domain names in global marketing. This also implies that this realization occurs only in medium to large multinational corporations, and small and medium enterprises, which make up the bulk of business entities in Taiwan, still lag behind in mastering the potential of using domain name in marketing, trademark protection and other areas. It may even be necessary for them to regain ownership of their domain names through litigation or by paying the parties involved, which is regrettable.

Finally, few countries have enacted laws and regulations specifically for the administration of domain names for the purposes of providing the required guidelines to protect legal rights. The domain name system has seen tremendous changes over the past 30 years. With the emergence of new gTLDs, attention will be focused on whether Taiwan's existing laws and regulatory mechanisms are adequate and if the ideal of protecting consumer rights can be achieved while allowing industry players to enjoy sufficient space for innovation with proper government regulatory efforts.