I, as a business owner, delight in being able to have www.mycompany.com on my business cards, letterhead, sides of busses, billboards, skywriting, word-of-mouth, and a myraid other things.
Your plan denies me this
No, it doesn't. My plan separates the unique identifier function (which I have just learned to call a "handle") from the mnemonic directory key function (which I have just learned to call a "name"), both of which are bundled together in a domain name. I think that you are most concerned with the name part. DNS, as well as competing services, will continue to offer you that. My proposed service will offer you a huge supply of handles, in addition, and independently. The main point of this is to separate the market for meaningful names, which are naturally scarce, from the market for handles, which are naturally plentiful, so that the high price of the first ceases to jack up the price of the second. I also believe that this reorganization will encourage more effective competition for providing name resolution service, which will also bring down the cost of that service, but merely making handles plentiful is a big win by itself.
You have to build it better. I don't see "better" in your design.
The "better" is merely the increased choice. By unbundling, I allow you to get handles for a song. My handles do not compete with names. Currently, you can only buy a cheap handle along with an expensive name.