Businesses will have to pay to register websites with a Cayman domain name under new rules which will see .ky Internet addresses sold worldwide.
Around 10,000 local businesses, which currently have .ky addresses, have six months to confirm they wish to keep the site name and pay the US$40 annual registration fee. Government will also have to pay the fee and register all its .ky Web addresses.
After that, the Web addresses will be sold internationally at the same price. At that point, they can be bought and traded on a thriving secondhand market, according to the Information and Communications Technology Authority.
The authority believes there will be demand from companies based overseas that are affiliated with Cayman for the domain – previously unavailable to anyone who does not live in the jurisdiction.
ICTA also believes it can leverage the .ky handle to create marketable website addresses that can be sold at premium prices.
Certain catchy domain names, for example www.luc.ky, are being held back from general sale to be auctioned in the hope of a cash windfall.
The tiny Polynesian island of Tuvalu and the Eastern European state of Montenegro have made vast profits selling the .tv and .me addresses to television and social media firms worldwide. While .ky doesn’t have that kind of cachet, ICTA believes it will generate interest.
“There are all sorts of unique and interesting ways to use the .ky extension,” said Alee Fa’amoe, managing director of ICTA.
The authority, which currently spends around $120,000 annually to manage and maintain the domain, hopes to turn the responsibility into a profit-making venture.
It has partnered with Cayman Islands-based Internet investor Frank Schilling, who owns global domain registry operator Uniregistry, to manage the domain and market the addresses for sale.
Speaking at a press conference to announce the plan on Thursday, Mr. Fa’amoe said he believes the project could turn an annual profit of around $200,000 for government.
Uniregistry will take a percentage of the $39.88 fee for every domain name sold. The company is also being paid $20,000 up front to get the domain registry into shape. ICTA is encouraging anyone with a Cayman business to move quickly to register their domain name.
“If you have a jerk stand, a fishing business, a kitchen company, whatever it is, we encourage folks to get those domain names registered before it goes open to the world,” said Mr. Fa’amoe.
He added that the price – more expensive than most .com addresses – reflected the size of the market and the cost of maintaining the registry.
“The price is not there to punish anyone or make anyone disadvantaged. If we had expected millions of registrations, we could have set it at $5 or $10, but we don’t expect that kind of volume,” he said.
Once the domain goes global, specialist companies will be able to buy up potentially marketable domain names and sell them on at higher prices. Even now, with the .ky addresses only available to people in Cayman, there is nothing to stop local entrepreneurs from buying and reselling domain names.
“At that point, the market will determine the price. I am sure there will be onward selling of domain names. That is how the market has evolved over time,” Mr. Fa’amoe said.
He acknowledged that legislation around trademarks and copyright in Cayman was not up to speed with the rest of the world, but he said an established dispute resolution process would be used to deal with cyber-squatting – the practice of buying up Web addresses affiliated with a brand or business in bad faith in order to sell them to that business at a profit.
In some cases, unscrupulous operators have bought Web addresses associated with businesses and posted derogatory material – essentially blackmailing the business to buy the address at a premium.
Businesses who feel their name is being used maliciously or in an attempt to piggyback on their brand can bring a complaint to ICTA.
Mr. Fa’amoe said the changes would help clean up the process and make it easy to register and pay for .ky addresses online.
The authority is spending $10,000 to market the new system and to encourage Cayman businesses to get registered.
Mr. Fa’amoe said the authority worked with Uniregistry because the company has expertise that was not available in-house. “Frank Schilling is passionate about his business and about Cayman,” he said. “He has been here for over a decade and he wants to give back. We needed a service from a global provider and we found one down the street.”
Despite Uniregistry’s involvement at the outset, ICTA expects to conduct an open tender in 2016 for the ongoing contract, potentially bringing other firms into the mix to sell .ky addresses.