Thousands of companies, far more than expected, are handing over hundreds of dollars each to block their brands in the new .xxx internet domain.
According to ICM Registry, the company behind the adults-only extension, porn-shy firms have applied to defensively block more than 10,000 trademarks in just the first week of its "Sunrise" period, which runs until 28 October.
"All phases of the Sunrise have exceeded forecasts for the whole 52-day period within the first seven days," ICM president Stuart Lawley said. "With over six weeks left, it is very difficult for us to predict the eventual results."
ICM has offered three ways for companies to get their hands on .xxx domains, or to block them, before they become generally available in December.
For porn companies, they can apply to "Sunrise AT" if they have a trademark or "Sunrise AD" if they have a matching domain in another extension.
For those outside the industry, Sunrise B asks companies to pay a one-time fee to have .xxx domains matching their trademarks permanently disabled. The addresses will never resolve, and the trademark owners will not have to pay recurring annual fees.
The B phase is designed for companies with family-friendly images that don't want to appear to be associated with .xxx even by having their names listed in Whois databases.
"Sunrise Bs and ADs lead the way in terms of numbers but even ATs have exceeded our estimates," Lawley said, noting how difficult it can be for a porn company to obtain a trademark.
In all three cases, the fee charged by ICM's registrar partners is around $200 to $300 (£127 to £190). For resolving domains, as opposed to blocks, the subsequent annual fee will be around $100 (£63).
"Based on actions to date, .xxx blocking by our customers will likely be the highest of any [top-level domain] launch since .eu, a very big surprise for us," an executive from one of ICM's 70-odd approved registrars told us.
When the .eu domain launched in 2006, tens of thousands of domains were pre-emptively registered, though many ultimately turned out to be fraudulent or examples of companies gaming the system by warehousing domains for their resale value.
Unsurprisingly, the launch of .xxx has seen ICM accused of a "shakedown", "extortion" and "blackmail" by commentators in both the anti-porn brigade and the general corporate world.
Penny Young Nance, CEO of the anti-porn group Concerned Women for America wrote in a recent Fox News op-ed: "In my opinion, what they’re doing is nearly extortion. And worst of all, the joke is on us, the regular people: the .xxx domain ramps up the profits of the registry companies at the same time that it metastasizes the presence of online porn".
Lawley said he sees the sunrise period as "exactly the opposite".
"We are the only TLD launch ever to introduce this one time processing-fee only Sunrise offer," he said in an email. "All the other registries we have seen charged a similar application fee for the trademark validation PLUS the regular annual fees, which in some cases could add up to millions of dollars a year."
Because ICM priced its Sunrise registry fees on a cost-recovery basis assuming 10,000 defensive registrations, now that it has beaten that target it will receive a one-time windfall profit from trademark owners buying up non-resolving domains. ®