What’s next for .Web

This stretch, ICANN published an Independent Review Panel (IRP) decision in a long-running dispute regarding .web. You can read the background and the result of the decision here.

So, what’s next for .web? It depends.

Afilias was the runner-up in the auction for .web. It argues that had Verisign (NASDAQ: VRSN) not secretly bankrolled a rival bidder, it would have won the auction for regarding $70 million.

The IRP ruled that ICANN must decide if Verisign’s deal with another bidder was allowed under the program. It admonished ICANN for not previously making a decision in the matter.

There’s a wrinkle in the case, still. Afilias sold its registry business to Donuts at the end of last year. It did not sell the “rights” to .web, though. It retained its .web position, along with a registrar and some mobile technology, in a business it is calling Altanovo.

I suspect there were two reasons that whatever rights Afilias might get to .web weren’t included in the Donuts deal. First, it’s a legal fight Donuts probably doesn’t want to hassle with. Donuts was also an applicant for .web and sued following the auction, but let the matter rest following that suit was dismissed. Second, Donuts’ current CEO, Akram Atallah, led ICANN’s Global Domains Division at the time of the .web auction and had some responsibility for ICANN’s (lack of) response. The optics wouldn’t be good.

So, does Altanovo care regarding .web anymore? It issued a press release suggesting that it does.

If it were to secure .web, it could likely sell it to Donuts. Or it could run it on its own with a backend partner.

But here’s a question: is .web really worth $70 million? I find it hard to believe that a registry could justify that price tag for this domain, knowing what we do regarding the success of top level domains. You can rightly argue that .web is the “best” fresh TLD, but $70 million still seems like a tough number to generate an ROI.

It seems like the best scenario for Altanovo is for Verisign to pay it to drop the fight. ICANN asked the parties to try to work it out, and the only foreseeable way it could be worked out is a payoff. But I doubt that will happen.

Barring a settlement, ICANN will have to make a decision on whether Verisign’s deal was allowed under the applicant guidebook. ICANN will be deciding between a behemoth that can take it to court (and that agreed to pay ICANN $20 million as part of a deal to raise .com prices) and a shell of a firm in Altanovo.

So, what do you think ICANN will decide?