NeuLevel, a joint venture between domain-name registrars Melbourne IT and NeuStar, has been awarded the opportunity to negotiate with ICANN (International Corporation for Assigned Names and Numbers) to operate a new registry for the .biz top level domain (TLD).
After a lengthy evaluation process, ICANN approved seven new top-level domains including .biz, .info, .name, .pro, .coop, .aero and .museum.
"As an Australian company we're very proud," said Andrew Field, chief financial officer at Melbourne IT. "ICANN wanted to award these names over several continents, and has made it clear our involvement was a major influence on the NeuLevel bid."
While Melbourne IT and NeuStar were successful with the .biz bid, their plans for operating a .per registry were thwarted. In Field's opinion, this has less to do with the validity of the .per bid and more to do with ICANN's wish to split the bids among several registrars.
"We had three out of the final nine names being considered, and the fact that we only ended up with one out of seven was because ICANN didn't want to award more than one registry to each bidder," he said.
Melbourne IT (45 per cent) and US registrar NeuStar (55 per cent) own the NeuLevel company, and all registry income from the .biz domain will be fed into the joint venture.
Field is confident the .biz domain name will be popular and profitable. The .com name has moved beyond business use and is considered a generic domain name, whereas .biz will be specific to businesses. Field said the .biz domain name will be popular because of several value added business services the registrar plans to offer with it. Due to the current nature of negotiations with ICANN over the running of the .biz registry, he was unable to elaborate what services are planned. Either way the company is faced with a significant challenge in convincing companies of the value of the .biz domain.
"We're competing against a formidable brand name in .com, so we'll have to work hard," he said.
Making a return on the bid tender investment will also prove a significant challenge. Field said the company originally estimated the legal cost of the bidding process at approximately a million dollars, then estimated that building the registry software will cost as high as $20 million. Now that ICANN has announced what bids were successful, Field is more confident over what volumes the .biz registry should expect, as the .web domain, which would have been a direct competitor to .biz, has been ruled out.
"We estimate it taking 18 months to get a return on investment on our bids, as in theory the business won't be running until mid-way through next year, and it should take a further 12 months to get a significant return," said Field.
Regardless of how fast the company can get this return on its bids, Melbourne IT and all registrars should benefit from selling the new top-level domain names once the main registries are up and running. But again, these revenues won't start kicking in until mid-way through 2001.
"The negotiation process with ICANN could be quick or it could take several weeks, we don't know," said Field. "We have to start planning a system to run the registry, and hopefully we'll be up and running with .biz by mid next year."
Erika Roberts, director of auDA and a member of ICANN's name council, said Australia has developed a lot of credibility at ICANN level, primarily through the work of former NOIE (National Office for the Information Economy) CEO Dr Paul Twomey and Melbourne IT. "Given that the .web domain has not been issued, .biz is the plum new TLD and it is a remarkable coup for Australia and Melbourne IT," she said.
