.nyc cyber struggle pits local pioneer vs. city and Koch, too

By Lincoln Anderson 

New York City last week announced its plan to buy the .nyc top-level domain — despite the fact that an East Village Internet guru says he invented .nyc, and that his company has owned it for the last 13 years.

Meanwhile, Ed Koch — the virtual symbol of New York moxie — has been brought in as a paid endorser by a rival group vying for the coveted Internet address.

The Oct. 5 press release by the Department of Information Technology and Telecommunications not only stated that the city hopes to acquire the T.L.D., but also seeks a partner “to operate, administer, manage, maintain and market .nyc.”

A request for proposals, or R.F.P., for a “qualified vendor” to partner on .nyc has been issued, with responses due Nov. 12.

It’s up to ICANN — the governing body that charters new T.L.D.’s — to decide if .nyc will become available. According to DoITT, indications are good .nyc will be put up for sale early next year. Under rules for T.L.D.’s for geographic locations, New York City would get first dibs on .nyc, which would cost $185,000. The city would foot the purchase price, but the partner would pay the start-up cost, plus ongoing operating costs.

According to the R.F.P., “The City currently intends to use .nyc to generate revenue, assist residents in locating City government services, assist local businesses to thrive, market the City, promote tourism in the City and spread the dynamic image of New York City around the world.” 

Council Speaker Christine Quinn first mentioned .nyc in her State of the City address in February, playing up its benefit to small businesses.

“Finding a partner to join the city in making .nyc a reality for small businesses in New York is vitally important,” she said last week. “Once the .nyc program is launched, local business owners will be able to uniquely associate themselves and their business with their home, and the NYC brand.”

However, Garrin says no one can buy .nyc, because his company, name.space, owns it — and isn’t selling.

“It’s nothing new,” he said of the city’s announcement. “It tells me what we already knew — that the city doesn’t have the way to do this and is looking for a partner in this. ... In any case, if the city wants a partner, they can have one — and that’s us. We own the domain.”

Garrin’s .nyc currently isn’t operable in the so-called main root of the Internet, since ICAAN has blocked his access to it. But, with minor tweaks to one’s computer, .nyc does work on an alternate network created by Garrin.

He also doesn’t think .nyc alone will generate as much revenue as the city expects. Beyond .nyc, he has coined scores of other T.L.D.’s, some of which would be far more lucrative, in his view, such as .shop, for example. But again, ICANN hasn’t allowed any of these T.L.D.’s into the root.

Nevertheless, Garrin has been crunching the numbers with business experts from Pace University, and says his 100 top-performing T.L.D.’s, within four years, could generate hundreds of millions of dollars.

“.nyc is at the bottom of the list,” he explained. “It would only make $1 million out of $800 million [generated by all 100 of his T.L.D.’s]. On its own, .nyc as an economic input is nothing — maybe a couple of million dollars,” he scoffed.

Going for quality over quantity, Garrin more recently whittled down his 100 T.L.D.’s to 20 favorites that he’s hoping to get approved by ICANN, including .art, .blog, .gay, .green, .media, .peace and .sucks.

The only way for the city to make money on .nyc, he said, would be to auction “high-value generics” — like sports.nyc, theater.nyc and shop.nyc. 

But, again, the city won’t have the chance to do that, because, according to Garrin, name.space intends to “proceed with the ICANN processing” to maintain its ownership of .nyc. 

ICANN’s process has an arbitration contention clause, and Garrin said name.space will go that route, at least initially.

“We’re trying to take the path of least resistance,” he said. “But if we have to file an infringement suit, so be it. I’m not looking to create conflict — but I don’t want people to rip me off.” 

Meanwhile, another group, Dot NYC LLC, is angling to be the city’s partner, should it acquire .nyc. They enlisted former Mayor Koch as a compensated endorser to do a YouTube video on their behalf, which first appeared in June.

“.nyc is the best real estate opportunity since the Dutch bought Manhattan,” Hizzoner pitches in the video. “And I can’t wait to sign up for edkoch.nyc and, while I’m at it, I’ll probably sign up for mayorkoch.nyc, as well. ... The experienced team behind Dot NYC LLC is the perfect team to run .nyc.”

David Goldman, a Dot NYC LLC spokesperson, said, if they win the R.F.P., there’s an agreement that Koch will appear in ads for them. 

On Garrin, Goldman said, “Is this the guy who says he already owns it? That’s ridiculous. That’s the Internet equivalent of someone looking up in the sky and saying, ‘I declare I own the sun, the moon and the stars.’”

But Garrin countered, “I have records and transactions dating back to inception [of .nyc] in 1996 — nobody else can claim actual use, because I had actual use. Whatever they do, it’s 99 percent sure that I have claim.”

All that New York City has to do is sit back and let Garrin — a self-described social entrepreneur — run .nyc, he said. He would use the revenue — and hopefully that from his other T.L.D.’s, if approved by ICANN — to give New York City students laptops and wire schools for WiFi.

“The city, they don’t need to do anything,” Garrin said. “I have a civic agenda.” 

But Goldman noted ICANN has said it only will accept applications for a geographical-location T.L.D. if the local municipality supports it. For example, Boston Market fast-food chicken restaurants could only acquire .bos if the city of Boston approved of it, he said. Similarly, Macau — not Macintosh computers — would have first claim on .mac. So whoever operates .nyc must have New York City’s O.K., he contended.

A New York Post article last week noted that Dot NYC LLC has estimated it would cost $10 to purchase an individual Internet name with .nyc at its end. However, Garrin says the addresses probably would need to go for $30 each to make a decent return. The Post noted Dot NYC LLC thinks the start-up cost for .nyc would be $1 million, a figure Garrin agrees with.

Nicholas Sbordone, DoITT spokesperson, said, if ICANN opens up .nyc for purchase, nothing would be finalized until mid-to-late 2010. Money raised through .nyc would go into the city’s general fund, he said. New York City is among one of the first cities anywhere to try to get its own T.L.D., he added.

Sbordone stressed no one has an inside track on partnering with the city on .nyc — including Dot NYC LLC, whose name might seem to imply that.

“As [for] Mr. Garrin’s ownership claim on .nyc, I would encourage him — and any and all other interested parties — to respond to the recently issued R.F.P.,” Sbordone said.

Thomas Lowenhaupt, of Connecting.nyc Inc. — whom Garrin previously considered his main rival, charging he was trying to “steal” .nyc from him — is not sure now if he’ll respond to the city’s R.F.P.

“Our mission is to educate residents, neighborhoods, civic organizations, community government and small businesses on ways to make the .nyc T.L.D., and the ’Net, an integral part of their existence,” Lowenhaupt said. “With the recent R.F.P. looking at .nyc as a short-term plug for the coming budget gap, rather than as an opportunity to invest in infrastructure for a digital era, I’m not certain there will be a role for a thoughtful development of the T.L.D., for education, or for us. But we’ve not made a final decision.”

DoITT’s Sbordone confirmed that countries and cities are getting preference for T.L.D.’s that others might want. For example, he noted, .tv is already taken — not by a television network, but by Tuvalu, a remote Polynesian island nation, population 12,000.