.grocery Domain

A. Background of Wal-Mart Stores, Inc.

Founded in 1962, Wal-Mart Stores, Inc. ("Walmart") services customers and members more than 200 million times per week at more than 10,130 retail units under 69 different banners in 27 countries. With fiscal year 2012 sales of approximately $444 billion, Walmart employs more than 2 million associates worldwide. Walmart is a leader in sustainability, corporate philanthropy and employment opportunity.

Walmart operates retail stores in various formats around the world and is committed to saving people money so they can live better. Walmart earns the trust of its customers every day by providing a broad assortment of quality merchandise and services at everyday low prices (ʺEDLPʺ), while fostering a culture that rewards and embraces mutual respect, integrity and diversity. EDLP is Walmartʹs pricing philosophy under which it prices items at a low price everyday so its customers trust that Walmartʹs prices will not change under frequent promotional activities. Working with suppliers, Walmart offers the most relevant, broadest assortment possible across all categories.

Walmartʹs focus for its Samʹs Club membership-only retail warehouse club is to provide exceptional value on brand name and private label merchandise at ʺmembers onlyʺ prices for both business and personal use. Internationally, Walmart operates with similar philosophies. Walmart is engaged in the operation of: retail stores located throughout the United States; wholly-owned subsidiaries in Argentina, Brazil, Canada, China, Japan and the United Kingdom; majority-owned subsidiaries in Chile, Mexico, 12 countries in Africa, and 5 countries in Central America; and joint ventures in India and China and other controlled subsidiaries in China.

Walmart customers want expanded offerings in produce, meat and bakery, and Walmart added more than 100 new fresh items last year, with many more coming this year. Health and wellness is becoming more important to Walmart customers, and Walmart is responding by adding services to pharmacies, such as free monthly health screenings and hearing centers. Additionally, Walmart continues to add exciting brands in key categories, including apparel, jewelry, technology and entertainment. Walmart has also stepped up technology offerings, from free wireless networks in the clubs, to a more robust eCommerce site and the Sam's Club smart phone application. Sam's Club Plus Members can now access their personalized eValues through a kiosk in the club, the Sam's Club smart phone application, or online.

Walmart's culture is at the heart of how it operates its business. The core beliefs that Sam Walton established - respect for the individual, service to our customers and striving for excellence - drive Walmart to help customers and communities live better. Walmart has an enormous responsibility to lead on issues that make a difference for associates and communities. Several key pillars define this commitment: economic opportunity, sustainability, responsible sourcing, healthy living and community involvement.

Walmart recruits and develops the best talent around the globe and develops an engaged workforce by providing all associates with opportunities to learn, grow and advance. Since October 2005, when Walmart's sustainability program was launched, Walmart's focus has been on three goals: be supplied 100 percent by renewable energy, create zero waste, and sell products that sustain people and the environment. Sustainability is now ingrained in Walmart's business strategy, and Walmart has broadened and deepened this commitment.

Walmart values the trust customers place in us to provide them with safe and sustainable choices, and Walmart strives to be a leader in responsible sourcing and product compliance. Walmart made a global commitment to sustainable agriculture to help both farmers and customers in all of our markets. Walmart also kicked off a new initiative in the United States to make the food we sell healthier and healthier foods more affordable for customers. Walmart is also proud of the bold commitment we made last year to end hunger in America. Through financial contributions, in-kind donations and volunteerism, Walmart supports local communities everywhere we operate. The Walmart Foundation supports causes and efforts around the world, from alleviating hunger to disaster relief. Leading on social issues is now a key strategy in building the Next Generation Walmart, and we are using our size and scale to make a difference for customers and our world.

B. The Mission/Purpose of the .GROCERY gTLD

Walmart is the world's largest grocer and is seeking approval for the .GROCERY gTLD in furtherance of Walmart's core goal of providing a broad assortment of quality merchandise and services at everyday low prices. Walmart's proposed .GROCERY gTLD will be a cornerstone of Walmart's future online strategic initiatives by providing a trusted, hierarchical, and intuitive namespace for consumers of Walmart's products and services. The .GROCERY gTLD registry will be wholly owned and operated by Walmart as a "single-enterprise" TLD.

Over the past decade, ICANN has approved 15 new gTLDs that have historically been classified as either generic (.INFO, .BIZ, .NAME, etc.) or sponsored (.ASIA, .COOP, .TRAVEL, .JOBS, etc.). It is anticipated that in the current new gTLD application round, many corporations will take the opportunity to register their brands as "single-enterprise" or ".BRAND" gTLDs. This is a new approach to the operation of a gTLD in which the business relies on three important distinctions between it and the gTLDs that were approved in the 2001 and 2004 TLD expansion rounds.

First, there are presently approximately ten small gTLDs, each with fewer than 300,000 registrations, and each offering clear models of successful operation that can be followed by new gTLDs; second, experienced technical back-end suppliers (i.e., SRS/DNS services) are already engaged by Walmart; and third, with single-enterprise gTLDs, registry operations will be fully supported by established and financially sound companies such as Walmart that will operate the gTLDs in conjunction with their primary businesses. Walmart's plans for the .GROCERY gTLD remove the risk and uncertainty of prior gTLDs by relying on the aforementioned three defining factors.

Walmart will operate the .GROCERY gTLD in a manner similar to many of the small gTLDs now in operation—with the distinction that Walmart does not intend to create a public registration market for sale of second level .GROCERY domain names. A shared principle feature of such existing small gTLD operations is reliance on trusted back-end suppliers. Walmart will rely on outsourcing all SRS, DNS, DNSSEC, WHOIS, Data Escrow, and registrar support operations to well-established technical service providers. Walmart will also take advantage of its existing sophisticated corporate departments to interface with outside vendors on technical, legal, accounting, marketing, communications, and compliance issues associated with the .GROCERY gTLD.×

In recent years, Walmart has invested heavily in global eCommerce in order to reach more customers. In 2010, Walmart consolidated its eCommerce activities around the world in a Global eCommerce Division with three goals: 1) Develop and execute a global eCommerce strategy; 2) Accelerate global online channel growth; and 3) Create technology platforms and applications for every Walmart market. Walmart understands the impact that changing technology has had on retail and has dedicated eCommerce platforms around the world; the investments made in these platforms are helping to accelerate Walmartʹs growth in other markets. The .GROCERY gTLD will be a small, specialized gTLD with no public registration sales market, and Walmart anticipates issuance of no more than 500 second level .GROCERY domain names within the first five years of operation of the .GROCERY gTLD. Walmart has based its planning for the .GROCERY gTLD on careful analysis of the history of gTLD operations, particularly the introduction of gTLDs since 2001. This analysis has been developed by an internal team of specialists at Walmart as well as outside counsel and advisors. Walmart will be ready for the .GROCERY gTLD to be delegated within one year of signing a registry agreement with ICANN.

The .GROCERY gTLD is planned as a "single-enterprise TLD", with the goal of promoting and protecting Walmart's online presence and identity; expanding Walmart's marketing and promotion efforts; and providing a secure channel for delivery of online products and services. Owning the .GROCERY gTLD will provide Walmart with the ability to enhance Walmart's business model and distribution channels, as well as Walmart's strategic positioning. The .GROCERY gTLD will be used to further Walmart's core goal of providing a broad assortment of quality merchandise and services at everyday low prices, to complement Walmart's branding and brand protection strategies, and to create new business opportunities. The foregoing will enable Walmart to capitalize in various areas, such as protecting Walmart brands; building brand loyalty; building customer trust; and enhancing security.

For the first three years of operation, Walmart will permit only the registration of second-level domain names in .GROCERY internally. These first years will allow Walmart to establish its operations and achieve full sustainability. On or about the third year of operation of the .GROCERY gTLD, Walmart will evaluate whether opportunities exist to carry out the business strategy for the .GROCERY gTLD through expansion including potential registration of second level .GROCERY domain names to third parties.

18(b)(i).

A central purpose of the .GROCERY gTLD will be to provide innovative product and service delivery platforms to customers through Walmart's use of intuitive .GROCERY namespaces (second level domain names) in relation to Walmart's core goal of providing a broad assortment of quality merchandise and services at everyday low prices. Walmart believes that the proposed .GROCERY gTLD has the potential to offer the following benefits to Internet users:

1) Establish a trusted source of information about Walmart for the millions of consumers who purchase goods in its stores and online, for investors seeking information, and for the general Internet user population as a whole;

2) Provide Walmart and its qualified subsidiaries and affiliates with short and memorable Internet addresses;

3) Improve navigation to Walmart products, services, advertising campaigns, public interest content, public awareness initiatives, etc.;

4) Through the adoption of new gTLDs by the wider Internet community, Internet users will benefit from a lower incidence of phishing and malware, which are often associated with typos of domain names in the .COM space and owned by cybersquatters, since they will be navigating to domain names in gTLDs like .GROCERY instead;

5) Minimize the cost and need for defensive registrations because domain names within the .GROCERY gTLD will be allocated to Walmart and its qualified subsidiaries and affiliates only; and

6) Develop a potential platform for the secure access to, and purchase of, Walmart products and information, in order to minimize the potential for counterfeit or infringing goods and services.

Examples of such services and second level domain names that may be used by Walmart include the following:

www.savings.grocery
www.rollback.grocery
www.affordablemeal.grocery
www.fresh.grocery
www.produce.grocery
www.bakery.grocery
www.seafood.grocery
www.deli.grocery
www.frozenfood.grocery
www.bread.grocery
www.meat.grocery
www.dairy.grocery
www.pasta.grocery
www.snack.grocery
www.beverages.grocery
www.cleaning.grocery
www.health.grocery
www.wellness.grocery
www.giving.grocery
www.community.grocery
www.sustainability.grocery
www.healthyliving.grocery
www.thanksgivingmeals.grocery
www.tailgaiting.grocery

Walmart customers will be able to more easily and intuitively locate each of the aforementioned products and services, and more, due to the uniform naming convention that will be used by Walmart for second level .GROCERY domain names.

18(b)(ii).

The primary mission and purpose of the .GROCERY gTLD is to provide a trusted, hierarchical, and intuitive online vehicle to deliver Walmart content and products, as well as information about the companyʹs brands, business, and focus. As Walmart continues to expand, it is the companyʹs desire to continue to pursue and develop opportunities to market and distribute its products and brands through a variety of platforms, including the Internet. Given that consumers are increasingly demanding access to companies and brands via a number of online channels, including domain names, Walmart believes that the .GROCERY gTLD has the potential to provide an innovative, virtual avenue to Walmart products and information that will deepen and broaden the companyʹs relationship with consumers.

Walmart customers' security on the Internet will be aided by Walmart's use of .GROCERY domain names as customers will recognize that .GROCERY domain names can be trusted as legitimate Walmart websites and email addresses. Walmart intends to gradually introduce second level .GROCERY domain names over a three year period while at the same promoting such domain names and associated products and services to customers. As additional second level domain names "go live," and Walmart customers begin to recognize and use the domain names and associate .GROCERY with Walmart, Walmart customers will be less likely to be deceived by phishing attempts, spam emails, and other Internet based fraud attempts that improperly use Walmart's name and/or trademarks.

Walmart's use of the .GROCERY gTLD will not only benefit Walmart, but it will also benefit consumers and the Internet community at-large by improving the safety and security of interactions on the Internet.

18(b)(iii).

Walmart earns the trust of our customers every day by providing a broad assortment of quality merchandise and services at every day low prices ("EDLP") while fostering a culture that rewards and embraces mutual respect, integrity and diversity. EDLP is our pricing philosophy under which we price items at a low price every day so our customers trust that our prices will not change under frequent promotional activity. This focus drives everything we do at Walmart. And, for the millions of customers who shop in our stores around the world each week, it means they can trust that our brand means we have every day low prices. Walmart's commitment to providing every day low prices is positively reflected in customer experiences at our stores and Walmart will extend its longstanding commitment to customer service to the operation of the .GROCERY gTLD.

Walmart believes that the .GROCERY gTLD will provide a single, trusted, ecosystem experience for Internet users worldwide, particularly consumers seeking Walmart products or information online. In addition to providing Walmart with short, memorable, and intuitive domain names, the .GROCERY gTLD will also indicate to users that they are navigating in a secure space where all domain names and content are owned and controlled by Walmart, thereby assuring them that they are protected from potential unauthorized, infringing, pirated, or malicious content.

18(b)(iv).

The market for the .GROCERY gTLD for the initial three years of operation will be limited to registrations within Walmart. Because of this condition, any registration and use requirements are more appropriately vested in these corporate/affiliate agreements and not in a domain name registration agreement. Walmart's strategy for release of second level .GROCERY domain names will be determined by corporate marketing executives and by the business plans of Walmart, and Walmart anticipates registration of no more than 500 second level domains within the .GROCERY gTLD at the conclusion of the first five years of operation. On or before the conclusion of the third year of operation, Walmart will evaluate whether opportunities exist to advance Walmart's business strategies for the .GROCERY gTLD through registrations of second level .GROCERY domain names to parties other than Walmart. Following is a description of Walmart's currently planned four-stage rollout for the .GROCERY gTLD.

1) Stage 1

The initial stage of implementation of the .GROCERY gTLD will involve Walmart registering a limited number of second-level domain names such as, for example, whois.grocery, nic.grocery, home.grocery, and savings.grocery.

The initial limited use of second level .GROCERY domain names will provide Walmartʹs technical services vendors and IT personnel with the ability to run tests to ensure seamless and secure access using .GROCERY 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 appropriate Walmart staff to coordinate with internal and external staff responsible for the delegation and setup phases of the .GROCERY gTLD to ensure proper transition from delegation to full operation of the .GROCERY registry.

2) Stage 2

Once all testing has been successfully completed, Walmart will begin allocating second level domain names in the .GROCERY gTLD for more widespread use by Walmart. Walmart will also begin evaluating strategies to potentially seek to migrate Walmart customer Internet visits/traffic away from (i) relevant second-level domain names owned by Walmart in other TLDs and (ii) long post-domain URLs that are currently being used, to Walmartʹs new .GROCERY gTLD.

During Stage Two, Walmart will also evaluate potentially expanding the operations of the .GROCERY gTLD to permit registration by other registrants, including customers, licensees, and/or strategic partners. Should an assessment of Walmart's expansion strategy lead to a decision to extend registration rights to other parties, the expansion would take place during Stage Four. Any expansion would be conditioned on a review of Specification 9 (Registry Code of Conduct), as set forth in the "New gTLD Registry Agreement", to ensure compliance with any potential evolution of Walmartʹs business model.

3) Stage 3

Walmart will continue to release second level .GROCERY domain names for use by Walmart. Depending upon the analysis undertaken by Walmart during Stage Two, and associated conclusions, Walmart may also begin to seek a more permanent migration of Internet traffic away from (i) relevant second-level domain names owned by Walmart in other TLDs and (ii) long post-domain URLs, toward the .GROCERY gTLD. It is during this stage that Walmart may also reach its decision to extend registration rights to a wider class of registrants, potentially including customers, licensees, and/or strategic partners. The dates of such an expansion decision are subject to change depending upon business, strategic, and industry factors at the time, as well as broader adoption rates of new gTLDs, and the expansion decision date is anticipated to be no earlier than three years from the date the .GROCERY gTLD begins operation.

4) Stage 4

Based on its experiences discussed above in prior stages, Walmart will assess whether its business plans and .GROCERY strategies should be augmented by extending registrations to a wider class of registrants, potentially including customers, licensees, and/or strategic partners and, if so, Walmart will begin to implement such an extension of use of the .GROCERY gTLD. Walmart anticipates that changes to the domain name industry, particularly the impact of single-enterprise gTLDs, will take at least five years to be realized. Any decision to expand the .GROCERY gTLD beyond use by Walmart will take into account the status and market impact of other single-enterprise gTLDs as well as the technical analysis of potential expansion of the .GROCERY gTLD.

The potential future uses of the .GROCERY gTLD by Walmart will also be driven by Walmartʹs future business strategies as identified in its annual report and investor filings. (See, e,g., http://investors.walmartstores.com/phoenix.zhtml?c=112761&p=irol-financialinfo.) Utilizing current projections based upon Walmartʹs existing businesses, future business plans, current domain name portfolio, and other strategic factors, Walmart estimates that second-level .GROCERY 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.

18(b)(v).

The .GROCERY gTLD will be a small, specialized gTLD with no public registration market for sale of second level domain names, and Walmart anticipates issuance of no more than 500 second level .GROCERY domain names within the first five years of operation of the .GROCERY gTLD.

Nonetheless, as a global retail company, Walmart respects the privacy of its customers and other consumers. The company employs a variety of physical, electronic, contractual, and managerial safeguards to protect personal and confidential information in its stores and on its websites. Walmart will take similar precautions to protect registrant and user data associated with the .GROCERY gTLD. Furthermore, given that every domain name will be registered to Walmart or its qualified subsidiaries or affiliates, Walmart has a vested interest in ensuring that accurate and current registrant information is readily available in connection with each .GROCERY domain name.

Walmart will ensure that the operation of the .GROCERY gTLD will be consistent with its Privacy Policy, see http://walmartstores.com/PrivacySecurity/9243.aspx.

In addition, Walmart intends to incorporate contractual language in its Registry-Registrar Agreement (RRA) modeled after language that has been included in the template Registry Agreement that has been successfully utilized by existing ICANN gTLD Registry Operators. The template Registry Agreement states, "Registry Operator shall (i) notify each ICANN-accredited registrar that is a party to the registry-registrar agreement for the TLD of the purposes for which data about any identified or identifiable natural person ("Personal Data") submitted to Registry Operator by such registrar is collected and used under this Agreement or otherwise and the intended recipients (or categories of recipients) of such Personal Data, and (ii) require such registrar to obtain the consent of each registrant in the TLD for such collection and use of Personal Data. Registry Operator shall take reasonable steps to protect Personal Data collected from such registrar from loss, misuse, unauthorized disclosure, alteration or destruction. Registry Operator shall not use or authorize the use of Personal Data in a way that is incompatible with the notice provided to registrars.ʺ

18(b)(vi).

Consistent with Walmart's plans for a phased introduction of second level .GROCERY domain names over a period of years, Walmart envisions a similar phased introduction of marketing efforts to promote recognition and use of .GROCERY domain names by Walmart's current and potential customers. Walmart anticipates allocating a percentage of its overall advertising budget to promote the .GROCERY namespace through a variety of marketing and customer outreach efforts including, for example, through traditional media, social media and electronic messaging and branding campaigns.
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Walmart intends to operate the .GROCERY gTLD as a "single-enterprise gTLD" and will closely control the registration of all .GROCERY second level domain names. The .GROCERY gTLD will be used to provide innovative product and service delivery platforms in relation to Walmart's core goal of providing a broad assortment of quality merchandise and services at everyday low prices. As a closed or single-enterprise registry, Walmart will bear the costs associated with operation and maintenance of the .GROCERY gTLD and consumers will not encounter the types of Internet vulnerabilities that are often associated with open or unrestricted registries. Social costs will actually be eliminated in that there will be no need for other trademark owners to defensively register second-level domains in the .GROCERY gTLD. Walmartʹs expectation is that use of the .GROCERY gTLD will eliminate many of the vulnerabilities that consumers face in the wider Internet today.

18(c)(i).

In the event that Walmart determines in the future that it will permit registration of .GROCERY domain names by third parties, such third-party registrations will be offered on a first-come/first-served basis.

18(c)(ii).

In the event that Walmart determines in the future that it will permit registration of .GROCERY domain names by third parties, Walmart does not envision charging consumers fees for such third-party registrations and therefore Walmart will not likely implement pricing discounts.

18(c)(iii).

Walmart is committed to providing the domain name registration periods set forth in the Registry Agreement. In the event that Walmart determines in the future that it will permit registration of .GROCERY domain names by third parties, Walmart does not envision charging consumers fees for such third-party registrations. If Walmart enters into agreements with third parties for the registration of second level .GROCERY domain names in exchange for compensation to Walmart, Walmart will include contractual provisions addressing any potential pricing increases for registrations and renewals of such second level .GROCERY domain names.
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Walmart is committed to following Governmental Advisory Committee ("GAC") advice in relation to management of second-level domain name registrations within the .GROCERY gTLD as set forth in the GAC Principles Regarding New gTLDs ("GAC Principles") and other GAC documents. Walmart will (A) block from registration, at no cost, names with national or geographic significance at the second level and all other levels of the .GROCERY gTLD, (B) follow GAC recommended protocols for release of such reserved names to relevant governments or organizations, (C) follow ICANN policies for potential release of such reserved names after providing relevant governments or organizations with the ability to register such reserved names, and (D) allow relevant governments or organizations to challenge abuses of names with national or geographic significance at the second level of the .GROCERY gTLD.

Walmart reviewed the following relevant background material regarding the protection of geographical names in the DNS:

- ICANN Board Resolution 01-92 regarding the methodology developed for the reservation and release of country names in the .INFO top-level domain (http://www.icann.org/en/minutes/minutes-10sep01.htm);
- ICANN's Proposed Action Plan on .INFO Country Names (http://www.icann.org/en/meetings/montevideo/action-plan-country-names-09oct01.htm);
- "Report of the Second WIPO Internet Domain Name Process: The Recognition and Rights and the Use of Names in the Internet Domain Name System," Section 6, Geographical Identifiers (http://www.wipo.int/amc/en/processes/process2/report/html/report.html);
- ICANN's Governmental Advisory Committee (GAC) Principles Regarding New Gtld (https://gacweb.icann.org/download/attachments/1540128/gTLD_principles_0.pdf?version=1&modificationDate=1312358178000); and
- ICANN's Generic Names Supporting Organization Reserved Names Working Group - Final Report (http://gnso.icann.org/issues/new-gtlds/final-report-rn-wg-23may07.htm).

A. Reserved Names

The names contained in the following internationally recognized lists will be reserved from registration at the second level within the .GROCERY gTLD at no cost to the relevant governments:

(1) The short form (in English) of all country and territory names contained on the ISO 3166-1 list (http://www.iso.org/iso/support/country_codes/iso_3166_code_lists/iso-3166-
1_decoding_table.htm#EU);

(2) The United Nations Group of Experts on Geographical Names, Technical Reference Manual for the Standardization of Geographical Names, Part III, Names of Countries of the World (http://unstats.un.org/unsd/geoinfo/ungegn%20tech%20ref%20manual_M87_c
ombined.pdf); and

(3) The UN member states' names in 6 official UN languages prepared by the Working Group on Country Names of the United Nations Conference on the standardization of Geographical Names
(http://unstats.un.org/unsd/geoinfo/9th-UNCSGN-Docs/E-CONF-98-89-
Add1.pdf).

B. Release of Reserved Names to Relevant Governments or Organizations

Consistent with GAC advice, and recommended protocols previously used by other gTLDs for the release to relevant governments or organizations of reserved second level domains, Walmart will follow the protocol below for release of reserved geographic names:

1. The Government or public authority concerned informs the GAC Secretariat of their request to register the name, and the designated beneficiary.
2. The GAC Secretariat authenticates the request and transfers it to the ICANN staff and to Walmart.
3. Walmart verifies the availability of the name and issues an authorization number that is transmitted directly to the designated beneficiary in the country concerned.
4. The designated beneficiary (the Registrant) registers the name, with an accredited Walmart Registrar, using the authorization number as their authority.

C. Subsequent Release of Reserved Names

Walmart will follow ICANN policies for potential release of reserved names after providing relevant governments or organizations with the ability to register such reserved names pursuant to the protocol described herein.

Given its broad consumer base and operations in the U.S. and abroad, Walmart looks forward to collaborating with other new gTLD registry operators (especially .BRAND gTLDs) in potentially working with ICANN's GAC to explore processes that could permit the release of initially reserved country names (including ISO-3166 two-characters). Specifically, Walmart is interested in exploring other Registry Service Evaluation Processes (RSEP) that have been filed by existing gTLD registry operators in releasing previously reserved domain names.

D. Objections from Relevant Governments or Organizations

In the event that a government or relevant public authority (or the GAC) notifies ICANN that there is misuse of any second level domain name in relation to the provisions of article 2 of the GAC Principles, ICANN shall notify Walmart and Walmart shall promptly suspend the said name pending the withdrawal of the objection by the relevant government.
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