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A new domain to be launched in December will be the first to reject advertising, making it unattractive to most cybersquatters. The .tel domain will not host websites, only contact information that will be sent to computers and phones.

The domain will begin to accept applications for names from 3 December, at which point only companies holding trademarks in names will be able to apply to register them.

Much cybersquatting is done by companies which earn money from adverts displayed on the pages belonging to domain names which users assume will belong to a famous organisation. That kind of cybersquatting will not work on .tel domain names, said Justin Hayward, communications director of Telnic, the registry behind .tel.

"[.Tel] does not allow for pay per click advertising, as it is the first top level domain that customers cannot host a website on," he said.

Not all cybersquatting is designed to earn advertising income. Some cybersquatters register domain names related to famous companies either to hold them to ransom or to confuse consumers into using them rather than the famous company for goods or services.

Hayward said that this would still be a problem on .tel, as it is on all top level domains (TLDs). "That is an industry issue," he said. "But we do have some protections. We have an acceptable use policy, and if people are not behaving according to that then we will ask them to change or we will shut them down."

Hayward said that the domain is focused on "communications, not content", and that all names will display a similar, standard page.

"Instead of using the DNS [domain name server] to store IP [internet protocol] addresses for a web server which then delivers html content for download, .tel uses the DNS to store contact information directly," said Hayward.

Phone numbers, web addresses and email addresses are then delivered to whatever device looked up the domain name in the first place. If it is a computer, the information will be delivered in a standard web page. If it is a phone or a BlackBerry, the system will recognise that and deliver it in a format suitable for those machines, Hayward said.

Telnic has also developed software which will integrate .tel listings into the contacts systems of PCs and smart phones. Those changes to contacts software will mean that if someone changes their phone number in their .tel listing it will automatically be changed in contacts' Outlook software or on their iPhone.

Companies will be able to register names at the .tel domain on 3 December, but registrars are encouraging them to act now to ensure that they gain control of the names related to their businesses.

Only holders of trademarks related to domain names will be able to register them for the first two months. After that, anyone will be able to register names for six weeks, but at a premium price. That price will be set by registrars, and some have published prices of up to £240 for a three-year registration.

After that period, on 24th March, names are expected to cost $15 to $25 per year, Hayward said.

"As with the launch of any new domain, businesses need to ensure they have taken the appropriate steps to register their new .tel domain before they become available on wider distribution," Jonathan Robinson of registrar NetNames. "This will protect their brands from any online speculators, maximising their online presence”.

Telnic said that 100 registrars have registered with it to begin processing such applications.

The creation of new domains is not always welcomed by brand holders. Each time one is created, famous brands are encouraged to register all variations of their names at that domain to ensure that cybersquatters do not gain control of them.

While the absence of advertising will make .tel less attractive to cybersquatters, some activity is still likely.

"The sunrise period for trademark holders will help, as will the fact that cybersquatters will not be able to earn ad revenue," said David Woods, a litigation and brand protection specialist at Pinsent Masons, the law firm behind OUT-LAW.COM. "But brand holders will still want to make sure they hold the names attached to their brands, and are likely to pay out again to defensively register all sorts of variations on their brands, whether they want to use .tel's features or not."

Copyright © 2008, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

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