The .xxx domain is the new kid on Web block, and while it was specifically created for pornographic sites, its presence has caused nothing but headaches for both the porn industry and non-pornographic businesses.

The .xxx domain was first proposed in 2000 by ICM Registry, a private company founded by Stuart Lawley, as a voluntary option for pornographic sites on the internet. It faced strong criticism from many politicians and conservative groups, but was resubmitted in 2004. The Internet Corporation for Assigned Names and Numbers (ICANN) Board finally approved the sTLD on March 18, 2011, and it went into operation on April 15, 2011.

The new domain will not launch until December of this year, but many companies are paying the $200 to $300 fee to preregister their domain names now whether they want to or not because they fear cybersquatters will register trademarks before them.

Cybersquatters register domain names of large businesses like Coca-Cola and Apple, for instance, before the actual companies have a chance to buy them. There are also typosquatters, who register well-known brand domain names as well, but with slight typographic errors like "Peppsi" instead of "Pepsi." To prevent brand theft and regain control of these corporate Web addresses, these large businesses are at the mercy of the cybersquatter who beat them to the punch, and the result could be a hefty ransom and legal battles.

ICM Registry said it has received 900,000 requests from companies to preregister their trademarks. So far, 80 percent of preregistered companies are non-pornographic businesses. These companies do not necessarily want to do this, since many corporations already own several domain names. According to Frederick Felman, chief marketing officer of MarkMonitor, a company that helps others protect their brands, most large companies "own tens of thousands of domain names."

Companies may not like it, but many are jumping on the chance to preregister now to save the trouble later. MTV Networks, VH1, Comedy Central and Budget Travel are among those who have preregistered at least one .xxx domain name.

Other companies are not only jumping on-board to preregister, but are also going along with the pornographic correlation of the .xxx domain. For instance, People for the Ethical Treatment of Animals (PETA) has preregistered peta.xxx, and plans to make it a pornography site that also promotes the importance of animal safety and respect. 

The porn industry, which the .xxx domain was designed for, is not happy with the upcoming launch either. While these companies also have to deal with cybersquatters and typosquatters, the industry also fears censorship associated with the new domain.

Many adult entertainment companies are refusing to pay the fee or register the domains, but are demanding protection. Manwin, one of the world's largest online porn companies based in Canada, had its lawyers send Lawley a letter in June warning his company to protect all 57 of Manwin's preexisting domain names under the .xxx domain or "risk the consequences." 

Hustler, a U.S.-based adult entertainment company with dozens of domain names, has sent Lawley a similar letter. These companies have claimed that the registration of their domain names without their consent will be a violation of their rights. 

ICM Registry responded to these companies by saying that a registry cannot be sued for trademark infringement. Lawley also noted that he is not launching the new domain to blackmail corporations with brand protection or for monetary reasons. 

"We're doing it on a cost-recovery basis," said Lawley, who said the fees would only cover the cost of the applicant's trademark ownership verification. "We don't make a dime out of it."

Some companies will receive the exemption that the porn industry desires. For instance, the Red Cross and the International Olympic Committee will have protected domains without having to pay the fees because they have international status.

ICANN will begin allowing companies to apply for their own domains starting next year, such as .Coca-Cola or .Nike, which is likely to result in another registry explosion and an increase in the cost of brand protection. 

"Multiply .xxx times several hundred, and that's the scale of the problem," said Felman.