Re: [wg-c] registry contracts

[Eric Brunner <brunner@world.std.com>]

Caroline,

I'm curious about an issue I hope you can shed some light upon.

I'm interested in new operator non-speculative capitalization, and Mr.
Penman's clients (registering mark names in inextant domains) gave me
pause.

What rational expectation can each registry operator have for initial
namespace allocation via trademark registration? A back-of-an-envelope
estimate will do. Just to be seasonal, and pick on the tissue mark,

	assume KleenexCo registered "kleenex" in the NSI gTLD-set, and
	possibly also in some part of the ccTLD-set,

	what value should KleenexCo place on "kleenex" in one of the 
	new gTLDs?

	how much will KleenexCo pay the new registry operator NewRegOpCo 
	to register "kleenex" in NewRegOpCo's domain?

Basically I'm fishing for several "price points"

	1. the price point at which KleenexCo will decline to pay
	   NewRegOpCo and pursue another rights defense, and
	2. the price point at which KleenexCo will decline to pay
	   the N-th NewRegOpCo, 

I'm supposing that KleenexCo will have some disinterest in any NewRegOpCo
registering "kleenex" in any NewRegOpCo's domain to some snotty kids who've
attitude, a sense of humor, colds, or cutthroat business ambitions.

What I suspect is that trademark holders will capitalize some, possibly
all new registry operators. I suspect that this mark-volume is on the order
of 10^^4, if not greater, hence that all NewRegOpCo business plans can,
without risk of fraud, assert a trademark derived recurring revenue stream.

If I've gone off the rails there's no point reading further, but if not,
then there is the price issue.

NSI has degraded the value of the generic registration by an order of
magnitude, and this "price ceiling" may not be available to trademark
registrants.

Assuming, just to use round numbers, that NSI charged KleenexCo $100 for
registration for some period, and now offers generic registration for $10
for the same period, and that NewRegOpCo offers to charge KleenexCo $100
(mark holders generally) for registration for the same period, and also
offers generic registration for $10 for the same period, what portion of
your constituency's clients do you think will accept the price model?

If NewRegOpCo identifies some higher figure as the buy vs litigate price
point ("lock-out" to coin a phrase), and charges some significant fraction
of that price, can NewRegOpCo charge significantly greater than in the
fixed-(old NSI)-price example with equivalent acceptancy?

To wave hands utterly, assuming 10^^6 marks, of which 10^^5 "care" on any
demand letter year, and 10^^4 care significantly, should every operator
expect careful cultivation of the marks interests to yeild

	1. 100,000 marks x $10 per period
	   (USD 1,000,000/period)
or
	2. 90,000 marks x $100 plus 10,000 marks x $1,000 per period
	   (USD 9,000,000 + 10,000,000 or USD 19,000,000 per period)

On average, what should the generic new TLD operator's proforma read
when it comes to receivables from marks holders?

Have we correctly assumed an undercapitalized (in the sense of names,
regardless of their valuation(s) possible) registry model, or should
we assume that every NewRegOpCo starts with a capital-in-marks of
some 10^^5 or 10^^6th names, valorized opportunistically?

To simplify matters, can we work on bulk deals? Who currently factors
in this form of receivable?

If most of this isn't garbage, I gather I'm about a year late in getting
to the obvious reason why the Intellectual Property Constituency of the
DNSO has such a concern over the expansion of the TLD-space.

Cheers,
Eric