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Adult Companies Bring Antitrust Lawsuit Against ICANN, .XXX Registry

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xxx-domainTwo adult entertainment companies have filed a federal antitrust lawsuit against the operators of the .xxx top-level domain, and the administrator of the Domain Name System (DNS), alleging violations related to the controversial TLD, AVN reported.

ICM Registry and ICANN are the targets of the lawsuit filed by Digital Playground and Manwin Wednesday. The suit is detailed covering items like the price ($150/year), the fact that ICM is the sole registry and the contract with ICANN has no price restrictions contrary to contracts done for other TLDs, and the contract is for 10 years with a perpetual right to renew.

The major complaint is the promotion of "defensive registrations" - non-adult companies needing to pay the fees to protect their brand from use with the .xxx ending.

As the suit states: "In fact, ICM promoted .XXX in large measure first to create and then exploit the need for just such defensive registrations. ICM has sold, during an initial two-month pre-operation "Sunrise" period, almost 80,000 special .XXX registrations at average fees to ICM of more than $150 per registration. These registrations are apparently largely for defensive purposes".

A number of universities have already purchased the .xxx domain names associated with their schools names, KLJB.com reported.

"We don't want someone coming across our trademark on a porn site. God only knows what they'd come up with," Terry Robb, director of information technology at the University of Missouri-Columbia told KLJB. The university purchased both the missouri.xxx and missouritigers.xxx domains.

Over 4,000 celebrity names have been blocked by ICM Registry as well as some government agencies. There are obviously a large number that could be on the list that are not and this may create further problems for ICM down the line.

The idea of the .xxx domain has been part of heated debates for many years. Christian groups saw it as legitimizing the adult space, while most in the adult industry believed the isolating extension would create a "ghetto" community, especially if countries restricted adult sites to that extension.

While ICM mentioned an initial price of $60 when the approval first came through, and the $150 fee now is substantially larger than the $10 and under other domain extension cost. ICM CEO Stuart Lawley said he thought he would have 500,000 registrations in the first year - under the agreement with ICANN the company pays $1 per year per registration with a minimum of $90,000 guaranteed. The annual fees start at $10,000 for the license with increases limited to 115% per year, according to the contract on the ICANN site.

ICM should have no trouble with the fees, the 80,000 "sunrise" registrations should have netted them over a million dollars and if they sell 500,000 in their first year they could bring in as much as $75 million. Plenty of money to fight the suit. But they are going against two of the bigger adult companies and the industry still does over $8 billion dollars a year!


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