gTLD	Full Legal Name	E-mail suffix	Detail
.MERCK	Merck Registry Holdings, Inc.	fairwindspartners.com	View

18.3.1 What operating rules will you adopt to eliminate or minimize social costs (e.g., time or financial resource costs, as well as various types of consumer vulnerabilities)?

MRH has proposed operating rules to limit registration to MRH and potentially qualified subsidiaries and affiliates and will provide a trusted online environment for end-users.

Therefore, one way in which social costs will be eliminated is that there will be no defensive need for other trademark and brand owners to register second-level domains in the .MERCK gTLD. In addition, the .MERCK gTLD will provide end-users with a trusted source for MRH information, goods, and services.

18.3.2 What other steps will you take to minimize negative consequences⁄costs imposed upon consumers?

MRH believes that the proposed operation of the .MERCK gTLD as set forth in this application has no known negative consequences or cost implications to end users. On the contrary, the proposed operation of this registry will likely lead to direct and quantifiable benefits to end users.

18.3.3 How will multiple applications for a particular domain name be resolved, for example, by auction or on a first-come⁄first-serve basis?

MRH does not envision multiple applicants for the same domain name, as domain names will only be allocated to its parent company, MSD, and potentially MSD’s qualified subsidiaries and affiliates.

18.3.4 Explain any cost benefits for registrants you intend to implement (e.g., advantageous pricing, introductory discounts, bulk registration discounts).

MRH does not envision any advantageous pricing, introductory discounts, or bulk registration discounts at this time because these marketing⁄commercial initiatives are inconsistent with the mission and purpose of the .MERCK gTLD as a trusted online source identifier for MSD, and potentially its qualified subsidiaries and affiliates.

Moreover, it is the current intention of MSD to have MRH provide domain name registrations initially at no cost, at least for the first five years of operation.

However, the company reserves the right to reevaluate this decision and may choose to impose a fee in the future. Any potential registrant fees imposed upon licensees or strategic parties will be commensurate with commercial agreements and made if this class of registrants is permitted to register domain names in the .MERCK gTLD.

18.3.5 Note that the Registry Agreement requires that registrars be offered the option to obtain initial domain name registrations for periods of one to ten years at the discretion of the registrar, but no greater than ten years. Additionally, the Registry Agreement requires advance written notice of price increases. Do you intend to make contractual commitments to registrants regarding the magnitude of price escalation? If so, please describe your plans.

MRH is committed to providing the domain name registration periods set forth in the Registry Agreement. Moreover, it is the current intention of MSD to have MRH provide domain name registrations initially at no cost, at least for the first five years of operation. Therefore, providing contractual commitments in a domain name Registrant Agreement regarding the magnitude of price escalations does not seem relevant or appropriate. MRH acknowledges that the current template Registry Agreement requires that the Registry Operator “shall offer registrars the option to obtain registration periods for one to ten years at the discretion of the registrar.”

MRH acknowledges that the current template Registry Agreement requires that the Registry Operator “shall offer registrars the option to obtain registration periods for one to ten years at the discretion of the registrar.” However, MSD, as the sole registrant within the .MERCK gTLD, intends to only register domain names on an annual basis through a single registrar.

This is done to better account for costs on an annual basis as well as to provide for more concise financial statements in Question 46, (e.g., no multi-year registration or deferred revenue).

gTLD	Full Legal Name	E-mail suffix	Detail
.LILLY	Eli Lilly and Company	fairwindspartners.com	View

18.3 What operating rules will you adopt to eliminate or minimize social costs (e.g., time or financial resource costs, as well as various types of consumer vulnerabilities)?

Lilly’s proposed operating rules limiting registration to Lilly and its qualified subsidiaries and affiliates, at least for the first three years of operation, will provide a trusted online environment for consumers to access Lilly’s online content, and will minimize social costs by default. This system will also provide consumers with a single, trusted source for information regarding Lilly’s products and services with a substantially lower risk of fraud, misdirection, infringement, or scams that have plagued consumers in .COM and other open gTLDs. Lilly does not anticipate consumer vulnerabilities; therefore, one way in which social costs will be minimized is that other trademark owners will not need to defensively register second-level domains in the .LILLY gTLD. For these reasons, Lilly believes the .LILLY gTLD may help to eliminate some of the vulnerabilities that Lilly’s consumers face in the wider Internet today.

18.3.1 What other steps will you take to minimize negative consequences⁄costs imposed upon consumers?

Lilly believes that the proposed operation of the .LILLY gTLD as set forth in this application has no known negative consequences or cost implications to consumers. On the contrary, the proposed operation of this registry will likely lead to benefits to consumers, as already described in this application.

18.3.2 How will multiple applications for a particular domain name be resolved, for example, by auction or on a first-come⁄first-serve basis?

Lilly does not envision multiple applicants for the same domain name, as domain names will only be registered to Lilly and its qualified subsidiaries and affiliates, at least for the first three years of operation.

18.3.3 Explain any cost benefits for registrants you intend to implement (e.g., advantageous pricing, introductory discounts, bulk registration discounts).

Lilly does not envision the implementation of any advantageous pricing, introductory discounts, or bulk registration discounts because these registrations would be limited to Lilly and its qualified subsidiaries and affiliates, provided at no cost, at least for the first three years of operation.

18.3.4 Note that the Registry Agreement requires that registrars be offered the option to obtain initial domain name registrations for periods of one to ten years at the discretion of the registrar, but no greater than ten years. Additionally, the Registry Agreement requires advance written notice of price increases. Do you intend to make contractual commitments to registrants regarding the magnitude of price escalation? If so, please describe your plans.

Lilly is committed to providing the domain name registration periods set forth in the Registry Agreement. However, as noted above, the registration of domain names is conditioned upon an affiliate or subsidiary relationship with Lilly, at least for the first three years of operation. Therefore, providing contractual commitments regarding the magnitude of price escalations does not seem appropriate.

Lilly acknowledges that the current template Registry Agreement requires that the Registry Operator “shall offer registrars the option to obtain registration periods for one to ten years at the discretion of the registrar.” However, Lilly and its qualified subsidiaries and affiliates, as the sole registrants within the .LILLY gTLD, currently intend to register domain names on an annual basis. This is done to better account for costs on an annual basis as well as to provide for more concise financial statements in Question 46 of this application, i.e., no multi-year registration or deferred revenue.