Arpanet operation started in 1972, without domain names, and without web. Addresses were only necessary for email and ftp (file transfer). Internet appeared in 1983 with TCP-IP and the DNS (domain names directory). The DNS content directory is called a root. This system was designed as being unique in the internet. Hence domain names registration, supervised by the National Science Foundation, was a monopoly charging $100 yearly for a 2nd level domain name.
Tired of fees perceived as excessive and of the restricted set of available top level domains (aka TLDs or extensions), some entrepreneurs created private companies for renting additional TLDs. E.g. Alternic (1995), or Pacific Root (1996). They proposed several hundred domains such as, art, biz, corp, free, sex, xxx. Independent roots were termed alternate (or alt) roots.
ICANN was founded later, in 1998. At that time the US gov policy took to privatize the domain name business to create competition. ICANN was supposed to be limited to a role of technical coordinator of other organizations. Instead it embarked to regulate directly domain creation and fees, thereby becoming financial beneficiary of its own regulations.
Registries were created for 2nd level domains bookkeeping, and registrars for selling registrations to users. Competition was real between registrars, and fees quickly came down to $10 yearly or less. ICANN allocated the bookkeeping of one or a few TLDs to each registry. At this level competition was minimal: a company, Verisign, was allocated .COM and .NET representing 85% of all domains registered under generic TLDs. Finally ICANN neglected to open the whole market to competition, and chose to remain a monopoly contributing to its private interests.
The .BIZ TLD was already offered by several independent roots when ICANN was created. Nonetheless, in 2001 ICANN introduced another .BIZ in its own root. For several years .BIZ was not unique in the internet. Actually ICANN, self-proclaimed monopoly, never cared of other existing roots. In October 2012 Name Space, an independent root, filed two law suits against ICANN for alleged violations of antitrust and trademark laws. There were quickly followed by two more law suits, one from Image Online Design, the other by Manwin Licensing International.
One may wonder how ICANN managed to establish its dominance worldwide. At the time of its creation most governments were totally unaware of internet potential and couldn’t care less about an esoteric domain names pastime. The few that were somewhat unconvinced were submitted to a heavy political pressure by the US gov, and finally caved in to ICANN coronation. Not China though.
In 2002, during the preparation of the UN World Summit on the Information Society (WSIS) the world woke up and realized that the USA were controlling the whole internet. ICANN illegitimacy and many other bones of contention became persisting international disagreements lasting nowadays.