TLD Auction Proceeds: A Foundational Opportunity for ICANN
By Jon Nevett, PIR President & CEO
Summary
While there is great excitement about Reveal Day and the 2026 Round of New TLDs, now is also the time for ICANN to start planning how to use the auction proceeds. With the influx of additional auction proceeds from the new round, ICANN should establish a foundation to distribute most, if not all, of these proceeds. We cannot let this opportunity to make a lasting, positive impact get bogged down in delays due to ICANN’s primary focus, bureaucracy, and limited remit. A dedicated foundation would give ICANN an opportunity to turn these proceeds into a lasting investment in the future of the Internet.
Background
Over a decade ago, from June 2014 to July 2016, ICANN collected over US$230M in New gTLD auction proceeds to be used “in a manner that directly supports ICANN’s Mission and Core Values.”1 In 2017, the ICANN Board convened a working group. In 2018, it approved principles. In 2020, it received a working group report. In 2022, the Board finally directed staff to implement a Grant Giving Program. In 2024, the Board allocated US$10M to the grants program and ICANN accepted applications. It wasn’t until 2025 that the ICANN Board approved the final slate of grantees. As of mid-2026, ICANN has disbursed about US$5M of the US$10M allocated.2
It took ICANN ten years to disburse US$5M to grantees, with another $5M allocated. Even though this initial round of grants was designated a “First Cycle,” there have been no public announcements of the timing or details of another round. So, we are left to expect another 3-year cycle to disburse another US$10M.
To be fair, ICANN also moved some of the auction proceeds to its own Reserve Fund (US$36M)3 and has allocated up to US$9.9M to its Applicant Support Program for the current round of New TLDs.4 According to its recent budget, however, ICANN still anticipates US$230M as “Grant Funds” as of the end of June 2027 due to very modest investment growth over ten years.5
ICANN’s available auction proceeds will grow dramatically in the next year. We now know that there are up to 263 contention sets in this round of TLDs. We also know that ICANN has banned private resolution of contention sets and requires sets to be resolved only via an ICANN auction. While the total number of these sets will be reduced if applicants withdraw their applications or elect to move to a replacement string to avoid string contention, we still expect all the higher-value strings to go to ICANN auction. Based on prior auction results, it would not be surprising if ICANN collected in the neighborhood of US$1B as part of the next round of new gTLD expansion.
Why a Foundation
While ICANN considered a foundation approach in the last community process, that was before the influx of substantial auction proceeds from the current round and before we saw how long it would take ICANN to distribute a small fraction of the current fund. Creating a foundation would enable ICANN to focus on its important mission and not be distracted by trying to administer a billion-dollar fund. At this time, ICANN should create a new organization with a dedicated staff and board focused on creating impact.
Grantmaking is not ICANN’s core competency. This is not ICANN’s fault. It is not a part of ICANN’s mission or primary focus. Grantmaking is not featured or even mentioned in ICANN’s 28-page Strategic Plan.6 In practice, ICANN has treated this work as a small side project, despite its opportunity for significant impact. This work requires time and resources, so it is no surprise that it took over a decade to grant US$10M. A foundation could have different bylaws, different staff, and different capabilities. Functioning as a separate entity would also allow the organization to operate much more efficiently than ICANN. Grantmaking through a separate foundation with relevant expertise would be scalable, replicable, and accountable.
In addition, a foundation could support causes that might not fall squarely within ICANN’s limited remit. For example, at PIR, we are huge champions and supporters of the Internet Watch Foundation (IWF) and its critical mission to combat Child Sexual Abuse Material (CSAM) online. Through our partnership, we have enabled registries and registrars to receive IWF’s domain alerts for free. Today, more than 55 million domains are covered under this program, making it harder for criminals to host and distribute CSAM. While ICANN’s Bylaws might preclude direct funding of similar work because it involves website content abuse, a foundation’s mission could be developed in a way that would clearly permit funding anti-CSAM efforts, or any other number of laudable efforts that are adjacent to but not squarely within ICANN’s current scope.
Through both direct and indirect grantmaking, a foundation could maximize ICANN’s impact in the community. As an example, the Internet Society (ISOC) created the Internet Society Foundation in 2019 as a distinct legal entity for many of these reasons. By bringing in specialized grantmaking professionals, ISOC ensured dedicated expertise for high-impact funding while keeping its primary organization focused on core operational goals. Since its work began, the ISOC Foundation has been incredibly successful in awarding roughly US$80M from 2019 to 2026 because it is focused on grantmaking. In fact, the foundation now accepts contributions from other sources and performs a grantmaking function for other organizations.
Conclusion
With the addition of the new round of auction proceeds, an ICANN foundation could be among the largest in the world.7 ICANN has the opportunity to improve the state of the DNS and the Internet in general. By doing so, ICANN can make lasting change and create a legacy of safety, security, and impact on our digital society.
The ICANN Board should spearhead this initiative, make it an immediate priority, and not let another decade go by without much material success to show. Let’s do this the right way and take this amazing opportunity to build a foundation that will have a lasting impact throughout the community. With these resources, ICANN could help change the world for the better. Together, let’s seize the moment and rise to the challenge.
1ICANN Board Resolution from March 26, 2026 https://www.icann.org/en/board-activities-and-meetings/materials/approved-resolutions-special-meeting-of-the-icann-board-26-03-2026-en.
2ICANN Grant Program First Interim Reporting Period Summary June 17, 2026; https://www.icann.org/en/system/files/files/grant-program-first-interim-reporting-period-summary-17jun26-en.pdf.
3A New Milestone for ICANN Reserve Fund, September 29, 2020. https://www.icann.org/en/blogs/details/a-new-milestone-for-icanns-reserve-fund-29-9-2020-en.
4ICANN Board Seeks Input on Additional Funds for 2026 Round Applicant Support Program https://www.icann.org/en/blogs/details/icann-board-seeks-input-on-additional-funds-for-2026-round-applicant-support-program-06-04-2026-en.
5ICANN Financial Year 2027 Budget; https://www.icann.org/en/system/files/files/adopted-icann-budget-fy2027-published-2026-en.pdf.
6ICANN Strategic Plan For Fiscal Years 2026–2030: https://www.icann.org/en/system/files/files/strategic-plan-2026-2030-13mar25-en.pdf.
7World’s 100 largest philanthropic foundations list: https://www.arcolab.org/en/worlds-100-largest-philanthropic-foundations-list/
Top 100 Foundations Worldwide: https://philanthropy.org/resources-top-100-foundations-worldwide/