18.1 Mission and Purpose of .SHOWTIME
The intended mission and purpose of the .SHOWTIME gTLD is to serve as a trusted, virtual platform to offer Showtime Networks Inc.’s (“SNI”) content to its audiences, while also deepening and broadening relationships with those audiences. CBS Corporation, the indirect parent company of SNI, has created a wholly owned subsidiary, CBS Domains Inc. (“CBS Domains”), as the entity to file this application and bring the .SHOWTIME gTLD to market.
CBS Corporation intends that as its online strategy evolves, so will its strategy for use of the .SHOWTIME gTLD. CBS Corporation is a leading mass media company with operations that include the following segments: Entertainment, Cable Networks, Publishing, Local Broadcasting, and Outdoor. SNI is a part of CBS Corporation’s Cable Networks segment.
SNI, a wholly owned indirect subsidiary of CBS Corporation, owns and operates the premium television networks: SHOWTIME®, THE MOVIE CHANNEL™, and FLIX®, as well as the multiplex channels SHOWTIME 2™, SHOWTIME® SHOWCASE, SHOWTIME EXTREME®, SHOWTIME BEYOND®, SHOWTIME NEXT®, SHOWTIME WOMEN®, SHOWTIME FAMILY ZONE®, and THE MOVIE CHANNEL™ XTRA. SNI also offers SHOWTIME HD™, SHOWTIME 2 HD™, THE MOVIE CHANNEL HD™, SHOWTIME ON DEMAND®, THE MOVIE CHANNEL ON DEMAND™, and FLIX ON DEMAND®. SNI also manages Smithsonian Networks™, a joint venture between SNI and the Smithsonian Institution, which recently launched the SMITHSONIAN CHANNEL™. All SNI feeds provide enhanced sound using Dolby Digital 5.1. SNI markets and distributes sports and entertainment events for exhibition to subscribers on a pay-per-view basis through SHOWTIME PPV®.
CBS Domains intends to initially limit registration and use of domain names within the .SHOWTIME gTLD to SNI and its qualified subsidiaries and affiliates. This initial limited use will allow CBS Domains 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 CBS Domains from its annual Code of Conduct Compliance requirements.
After Stage 3 (see below), SNI will evaluate whether opportunities exist to carry out the business strategy for the gTLD through expansion that continues the sustainable operations of the registry through fee-based registrations to parties other than SNI and its qualified subsidiaries and affiliates.
CBS Domains currently plans a four-stage rollout for the .SHOWTIME gTLD:
1. Stage 1
The initial stage of implementation of the gTLD will involve SNI registering a limited number of .SHOWTIME second-level domain names. This initial use will provide CBS Corporation’s IT and security personnel the time to run a number of tests to ensure seamless and secure access using the .SHOWTIME gTLD domain names, interoperability with various software and Web-based applications, and unbroken and secure use of all names. This initial allocation will also allow the appropriate CBS Domains staff to coordinate with the internal and external staff responsible for the delegation and setup phases of the .SHOWTIME gTLD to ensure a proper transition from delegation to full operation.
2. Stage 2
Once all testing has been successfully completed, CBS Domains likely will begin allocating domain names in the .SHOWTIME gTLD for more widespread internal corporate use at SNI. During this same time period, CBS Corporation will begin evaluating strategies to potentially migrate traffic to CBS Domains’ new gTLDs, .CBS and .SHOWTIME.
It is in Stage 2 that SNI will evaluate expanding the operations of the .SHOWTIME gTLD to potentially permit registration by other registrants, such as select licensees or strategic partners. Should an assessment of its expansion strategy lead to a decision to extend registration rights to other parties, this expansion is currently planned to take place in Stage 3. However, any expansion would be conditioned upon a review of Specification 9 (Registry Code of Conduct) set forth in the template Registry Agreement to ensure compliance with CBS Domains’ business model.
3. Stage 3
Depending on the analysis of the evaluations undertaken in Stage 2, SNI may begin to implement the migration of Internet traffic toward the new CBS Domains gTLDs, .CBS and .SHOWTIME. It is in this stage that CBS Domains also may implement SNI’s decision to extend registration rights to licensees or strategic parties, depending upon compliance with Specification 9, as noted above. The dates of any such expansion are subject to change depending upon business, strategic, and industry factors at the time.
After consideration of the following factors: analysis of SNI’s existing domain name portfolio; internal analysis of marketing initiatives; and the fact that SNI will have full control over the number of registrations in the .SHOWTIME gTLD namespace, CBS Domains 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 their experience with any expansion implemented in Stage 3, CBS Domains and SNI will assess whether their business plan and expansion strategy should be augmented by extending registration rights to a broader class of licensees. It is anticipated by CBS Corporation and SNI that changes to the domain name industry, and particularly the impact of .BRAND gTLDs, will take at least five years to be realized and assessed. Any decision to expand the gTLD beyond corporate, qualified subsidiary⁄affiliate, and licensee⁄partner use will take into account this experience as well as the technical analysis of potential expansion.
SNI intends to use the .SHOWTIME gTLD in ways that are consistent with its business, further explained in the CBS Corporation annual report and investor filings, see http:⁄⁄investors.cbscorporation.com.
Utilizing current projections based upon SNI’s existing business, business plans, current domain name portfolio, and other strategic factors, SNI estimates second-level domain name registrations to be in line with the projections set forth in the financial template provided in response to Question 46 of this application.
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