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Domain Tasting in the Spotlight

An article in BusinessWeek discusses “domain tasting” and its effects on major brands.

The article, titled “The Great Internet Brand Rip-Off“, discusses so-called “domain tasting” and how major brands are being exploited through domain tasting combined with typosquatting.

Domain tasting is the practice of registering a domain, checking its traffic and revenue, and returning it for a full refund within 5 days if it doesn’t meet certain criteria. Once a practice of only the top domainers who owned registrars, the common domainer can now participate thanks to new services. Moniker offers a domain tasting service that charges a $.25 fee for returned domains. Pool recently launched a service of its own.

It’s important to distinguish between the two types of domain tasting, which the BusinessWeek article fails to do. First, there’s domain tasting in which people register variations of trademarks (such as typos). This is what the BusinessWeek article addresses. Second, there’s domain tasting of non-trademarked domains. Many people would argue the latter is bad, but not as bad as domain tasting of trademarks. The article implies that the only “tasting” going on is that of trademarks.

The article also wrongly accuses Moniker of registering trademark domains. It’s unclear whether this is an assertion of the Verizon Communication’s (NYSE: VZ) attorney quoted in the article. The article says “What angers Deutsch is that none of the sites have anything to do with Verizon. Instead, they’re registered by companies like Nassau (Bahamas)-based Wan-Fu China and Pompano Beach (Fla.)-based Moniker.com.” My guess is it’s not Moniker that’s registering these domains on its own account. Rather, it is Moniker customers registering domains and using Moniker’s privacy services. Generally speaking, registrars cannot play censor and decide which domains their customers register.

These issues aside, there is growing pressure on ICANN to do something about domain tasting. After all, the five day registration grace period is being used in a way for which it wasn’t originally intended. It was intended to allow registrars to return domains that their customer registered by mistake (such as spelling errors) or for which credit cards were denied.

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  1. Mike says

    When are we going to see an article about people who sniff WHOIS searches and register the domain prior to anyone getting their themselves. I have to say that I only do my WHOIS searching at GoDaddy and if I want that name I had better register it within a day or two because otherwise some dumb schmuck will sell or give that search data to their friend or some business partner thing – and register it.

    Any way you slice that, its fraud.

  2. Editor says

    Mike, I have yet to have anyone provide me with good evidence that this is going on. The only evidence I’ve seen is for domain registration queries performed at a non-register site associated with CNET.

  3. Mike says

    Editor –

    Of course they’re not going to come right out and say they’ve been doing that. Would you? It may bot be illegal in terms of breaking any LAW but its definitely unethical. That is the opinion of a lot of folks:
    http://www.google.com/search?hl=en&q=godaddy+whois+steal

    Some say its pure capitalism at its finest. I am not too sure about that. Say I am the patent office and my clerks take dozens of applications each per day, but some of them know a few with access to a lot of cash and they photo copy those patents and develop the products themselves. Are they not stealing someone’s idea?

    Some call it extortion. I search, you steal the WHOIS query and register the name and then put it up for sale for 100x or more of its reg cost PLUS you earn PPC from the ads while it sits. If I want it, I need to pay you 100x of the cost it would have been if I had blindly registered it without doing the normal homework (trademark/patent violation checks, company name checks, etc)

    Ah well, if you’re looking for SPECIFIC proof then maybe they gets pretty darn close (if not all the way there):
    http://www.icann.org/meetings/marrakech/captioning-dn-27jun06.htm

    Its a bit to read but pay special attention to the comment beginning with:
    “And the customer says, hi, Bob, I’ve been doing business with you for many years.” Its about 1/2 way down and it begins to describe the huge problem we have going on with WHOIS searching.

    If, in fact, there is a market to mine the WHOIS data then expose it. Either make it freely available or charge for it – whatever. If there isnt a market or should not be, then secure it.

    When I ask GoDaddy customer service and then get replies to the effect that they tell me there arent enough hard drives to store all that data – I laugh. Without going into the technicalities – its certainly possible to intercept that search data and its certainly possible to store it, aggregate it and mine it. And then – sell it or give it away.

    DirectNIC.com and its arms of questionable sidekick companies are very well known for this and its already been sent to court in a number of cases with them – where they’ve lost nearly every case and had to give up the stolen name.

    The way I see it (and others too from what I
    read everywhere), is, that the level of fraud and corruption in the domain name business has already far exceeded that of the traditional real-estate industry which is very well know for its eye-raising under-the-table garbage.

    You’d think with electronic trackback, footprints, tracability that people would be less likely to do things like this.

    My confidence in GoDaddy is now ZERO. My confidence in the domain name business is fast approaching ZERO. I basically dont want much to do with this industry anymore. The fraud and corruption in advertising is increasing every day. Look at Afternic and its questionable activities. People are writing more and more about unknown PPC and CPM, inflating traffic, lifting and pocketing off the top from its customers – but never informing the customers of its policies. But I digress… or do I? 😉

    The domain name world is getting darker by the day.

  4. Editor says

    Mike, quick question: what are the “questionable” activities Afternic has been involved with? I haven’t seen anything questionable from them.

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