18.1 Mission and Purpose of .SAFEWAY
Safeway Inc. (ʺSafewayʺ) is one of the largest food and drug retailers in North America. As of December 31, 2011, the company operated 1,678 stores in the Western, Southwestern, Rocky Mountain, and Mid-Atlantic regions of the United States and in western Canada. In support of its stores, Safeway has an extensive network of distribution, manufacturing, and food processing facilities. Safeway owns and operates GroceryWorks.com, LLC, an Internet grocer doing business under the names Safeway.com and Vons.com. Through its subsidiary, Blackhawk Network Holdings, Inc., Safeway provides third-party gift cards, prepaid cards, telecom cards, and sports and entertainment cards to retailers in North America, Europe, Australia, and Japan. Safeway also holds a 49% interest in Casa Ley, S.A. de C.V., a food and general merchandise retailer with 185 stores in western Mexico. Safeway content is accessible in multiple TLDs, including the .BIZ, .COM, .INFO, .NET, and .ORG gTLDs, and the .CA, .CO.UK, and .US ccTLDs.
Safeway will be analyzing and evaluating other .BRAND gTLD applications as well as general market adoption to determine short- and long-term potential best-in-class use case options to more effectively service and enhance its online strategy. Safewayʹs current operating strategy is to provide outstanding value to consumers by offering a unique shopping experience in its stores and online, with a wide selection of high quality products at low, everyday prices and attractive Club Card specials. Safeway is also taking a brand management approach to building high quality proprietary consumer brands with significant innovation and new product development work.
The intended future mission and purpose of the .SAFEWAY gTLD is to serve as a trusted, hierarchical, and intuitive namespace provided by Safeway and its qualified subsidiaries and affiliates for consumers. Safeway will be the entity to bring the .SAFEWAY gTLD to market and is also applying for .VONS, .JUSTFORU, and .GROCERY (“Safeway Family of gTLDs”).
Although ICANN has not specifically recognized a .BRAND gTLD specification in the current version of the Applicant Guidebook, it is widely anticipated within the brand owner community that this will become a specialty subset of new gTLDs. The .SAFEWAY gTLD was planned as a .BRAND gTLD, with the goal of protecting Safewayʹs online presence and identity, expanding its marketing and promotional efforts, providing a secure channel for products and information online, and offering a platform on which to consolidate many of the intellectual property activities of Safeway.
Safeway intends to initially limit registration and use of domain names within the .SAFEWAY gTLD to Safeway and its qualified subsidiaries and affiliates. This initial use will allow Safeway to establish its operations and achieve full sustainability. This limited distribution, coupled with the other requirements set forth in Specification 9 of the template Registry Agreement, is intended to exempt Safeway from its annual Code of Conduct Compliance requirements.
Safeway has currently planned a four-stage rollout for the .SAFEWAY gTLD:
1) Stage 1
The initial stage of implementation of the .SAFEWAY gTLD will involve Safeway registering a limited number of second-level domain names and, potentially, using .SAFEWAY domain names to redirect to Safeway content in the .COM TLD.
This initial use will provide Safewayʹs IT and security personnel with the time to run a number of tests to ensure seamless and secure access using .SAFEWAY domain names, interoperability with various software and Web-based applications, and unbroken and secure use of all domain names. This initial allocation will also allow the appropriate Safeway staff to coordinate with the internal and external staff responsible for the delegation and setup phases of the .SAFEWAY gTLD to ensure proper transition from delegation to full operation.
2) Stage 2
Once all testing has been successfully completed, Safeway will begin allocating domain names in .SAFEWAY for more widespread internal use. During this same period of time, Safeway will begin evaluating strategies to potentially migrate traffic away from its current network of second-level domain names, which are registered in a variety of TLDs, to the new Safeway Family of gTLDs.
It is during Stage 2 that Safeway will evaluate expanding the operations of the gTLD to permit registration by other registrants, including licensees and strategic partners. Should an assessment of its expansion strategy lead to a decision to extend registration rights to other parties, the expansion would take place during Stage 3. However, any expansion would be conditional upon a review of Specification 9 (Registry Code of Conduct), as set forth in the template Registry Agreement, to ensure compliance with Safewayʹs business model.
3) Stage 3
Depending upon the analysis of the evaluations undertaken in Stage 2, Safeway may begin to implement the permanent migration of Internet traffic away from the TLDs in which Safewayʹs domain names are currently registered, to the new Safeway Family of gTLDs. It is during this stage that Safeway may also implement its decision to extend registration rights to a wider class of registrants, including licensees and strategic partners, depending upon compliance with Specification 9, as noted above. The dates of such an expansion are subject to change depending upon business, strategic, and industry factors at the time.
After consideration of the following factors: analysis of Safewayʹs existing domain name portfolio; internal analysis of marketing initiatives; and the fact that Safeway will have full control over the number of registrations in the .SAFEWAY gTLD namespace, Safeway is confident that the number of domain name registrations will be less than 10,000 in the first five years of operation.
4) Stage 4
Based on its experience with any expansion implemented in Stage 3, Safeway will assess whether its business plan and expansion strategy should be augmented by extending registration rights to a wider class of registrants, including, potentially, Safeway customers. Safeway anticipates that changes to the domain name industry, particularly the impact of .BRAND gTLDs, will take at least five years to be realized and assessed. Any decision to expand the .SAFEWAY gTLD beyond use by Safeway and its qualified subsidiaries and affiliates will take into account this experience as well as the technical analysis of potential expansion.
The potential use of the .SAFEWAY gTLD by Safeway will also be driven by Safewayʹs future business strategies as identified in its annual report and investor filings, see http:⁄⁄www.safeway.com⁄ShopStores⁄Investors.page#iframetop.
Utilizing current projections based upon Safewayʹs existing businesses, future business plans, current domain name portfolio, and other strategic factors, Safeway estimates that second-level domain name registrations will be in line with the projections set forth in the financial template provided in response to Question 46 of this application. |