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Domain Tasting in the Spotlight

An article in BusinessWeek discusses "domain tasting" and its affects 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.

By Andrew Allemann, Domain Name Blogger

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Comments

Re: Domain Tasting in the Spotlight By Suresh Ramasubramanian  –  Dec 16, 2006 6:54 pm PDT

> These issues aside, there is growing pressure on ICANN
> to do something about domain tasting.

'Tis a consummation devoutly to be wished, and that's sure to give Moniker and other [tasters|kiters|squatters] out there some serious heartburn.  Go for it, ICANN ..

Re: Domain Tasting in the Spotlight By Dave Zan  –  Dec 18, 2006 9:53 pm PDT

http://www.icann.org/meetings/saopaulo/captioning-dnmarket-06dec06.htm

AND WHAT TO DO ABOUT THIS? AT ONE OF OUR MOST RECENT MEETINGS, THE ALAC APPROVED REQUESTING AN ISSUES REPORT FROM THE ICANN STAFF. AND LET ME PUT THAT IN THE CONTEXT OF THE BYLAWS SO YOU CAN APPRECIATE WHAT THAT MEANS.

IF YOU PUT ICANN BYLAWS INTO YOUR SEARCH ENGINE OF CHOICE, YOU WILL COME TO THE PAGE ON THE ICANN WEB SITE THAT CONTAINS THE BYLAWS. ANNEX A IS THE GNSO POLICY DEVELOPMENT PROCESS.

AND THE PROCESS ALLOWS ANY ADVISORY COMMITTEE WITHIN ICANN — AND THAT WOULD BE SECURITY AND STABILITY, AT LARGE, THE GAC — ANY OF THEM CAN ASK FOR AN ISSUES REPORT FROM STAFF.

AND WE, SHORTLY, PROBABLY WITHIN THE NEXT WEEK OR TWO, WILL SUBMIT A FORMAL REQUEST FOR AN ISSUES REPORT TO ICANN STAFF.

WHAT THIS DOES IS TRIGGER CERTAIN DEADLINES IN THE BYLAWS.

WITHIN 15 DAYS OF RECEIVING THAT REPORT, ICANN STAFF HAS TO PRODUCE A LIST OF ISSUES THAT ARE INVOLVED IN THE PROBLEM THAT WE'VE FORESEEN.

SO WE WILL REQUEST THIS FORMALLY.

15 DAYS LATER, ICANN STAFF WILL PREPARE A REPORT ABOUT ALL THE ISSUES INVOLVED IN DOMAIN NAME TASTING.

THAT REPORT DOES NOT COME BACK TO THE ALAC.

IT COMES BACK TO THE GNSO COUNCIL.

THE GNSO COUNCIL THEN WILL RECEIVE THE REPORT, REVIEW IT, AND THEY HAVE 15 DAYS FROM RECEIVING THAT REPORT TO VOTE ON WHETHER TO CREATE A POLICY DEVELOPMENT PROCESS.

33% OF THE GNSO COUNCIL CAN INITIATE A POLICY DEVELOPMENT PROCESS.

NOW, THIS JUST STARTS THE POLICY PROCESS RUNNING.

AND IF I'M RIGHT ABOUT THE DEADLINES HERE, WE'RE GOING TO REQUEST A REPORT FORMALLY IN THE NEXT WEEK, ICANN STAFF WILL HAVE 15 DAYS TO RESPOND, THE GNSO COUNCIL WILL HAVE 15 DAYS TO RESPOND.

SO SOMETIME AROUND MID-JANUARY, WE MAY ACTUALLY HAVE A POLICY DEVELOPMENT PROCESS ON DOMAIN TASTING.

THAT DOESN'T PREJUDGE ANY OF THE OUTCOMES.

ONE POSSIBILITY IS THAT THE GNSO DECIDES TO HAVE A POLICY DEVELOPMENT PROCESS AND SIMPLY DECIDES THAT THE BEST THING TO DO IS FOR REGISTRIES TO MAKE THEIR OWN SOLUTIONS OR TO ICANN TO ENGAGE IN A PROCESS OF EDUCATION OF USERS TO EDUCATE THEM ABOUT THESE PROBLEMS SO THEY'RE NOT CONFUSED.

YOU KNOW, THERE ARE GRADATIONS HERE, OF COURSE, AND THERE ARE OTHER POSSIBILITIES THAT THE POLICY DEVELOPMENT PROCESS COULD ACTUALLY IMPLEMENT SOME OF THE THINGS THAT, I THINK, PAUL AND SOME OTHER PEOPLE HAVE TALKED ABOUT AS POSSIBLE SOLUTIONS.

SO THAT'S JUST TO GIVE YOU A FORWARD-LOOKING VIEW OF WHAT'S COMING DOWN THE PIKE.

Will they be able to come up with something timely in order to possibly avoid this?

She says legislation may be needed to stop Internet domain abuse. "It's become a feeding frenzy," she says. "Tasters aren't adding anything to the Internet but instability. And if ICANN doesn't do anything, we may need legislation to increase liability for registrars."

Pressure's building. Clock's ticking.

Re: Domain Tasting in the Spotlight By Frank Schilling  –  Dec 19, 2006 7:20 pm PDT

Editor's Note: Frank Schilling's valuable two part entry posted here was made a featured post and can now be read in its entirety below:

The Closing Window: A Historical Analysis of Domain Tasting

Re: Domain Tasting in the Spotlight By John Berryhill  –  Dec 20, 2006 9:50 am PDT

One of the great ironies here is that Verizon has, at its fingertips, a perfect mechanism for identifying verizon-bearing typos and other non-existent domain names that may be getting traffic.  As Mr. Schilling points out in his comment, that traffic doesn't go "nowhere" because a significant number of browser installations fail over to MSN search, YAHOO, AOL, or Google if a non-existent domain is entered.

So the first thing to realize is that in the absence of "domain tasting", then MSN, YAHOO, AOL and GOOGLE "get", and profit from, the traffic that evil domain tasters would otherwise get.  It's not about whether that traffic makes money.  It is solely about who gets the money.  Ms. Deutsch is going to do her level best to see that the large search engines profit from Verizon typo domains.

Verizon has 6.1 million subscribers to its ISP service - roughly 6.6% of US market share.  Consequently, Verizon is resolving millions of DNS queries a day, and providing DNS resolution to its subscribers.

What this boils down to is that Verizon already has the data it would need, simply by checking its own DNS server logs, to identify any of these traffic-attracting non-existent domain names and pre-emptively register them.  Considering that it costs less than 15K for Verizon to become its own registrar, then it can register, say, 10,000 variant domain names automatically culled from its own DNS traffic for $62,500.  Remaining unregistered variations could be safely ignored since the registration of a domain name which gets zero traffic is a non-injury to anyone. 

That system could be set up in a few days and run on auto-pilot with periodic parameter tweaking, and cost an order of magnitude less than what Verizon is paying Sarah Deutsch to have hissy fits.

I am reminded of the recent speaker in Brazil which complained that if a domain name only lasts five days, then the enforcement mechanisms to catch up with it are too slow.  Well, duh, if the domain taster didn't keep it for more than five days, it is because the domain name didn't get any traffic.  In other words, no consumer was confused, and no revenue was lost, because nobody used the domain name during the interval it was registered.

Surely if Verizon can allow the US government to obtain US telephone calling data without a warrant, then Verizon can use the data its own ISP operations generate to its own advantage here, and at a surprisingly low cost.

Re: Domain Tasting in the Spotlight By Chuck Hatcher  –  Dec 22, 2006 6:38 am PDT

So-called "domain tasting" is only an expedient method on the part of domain registrants to obtain information about the potential profitability of domain names. Before condemning the practice, it might be prudent to isolate the separate components of the activity to see where the "evil" lies.

First, as has already been stated, the number of available domain names with the potential to generate revenue in excess of costs has already decreased to virtually zero. Some were identified by past tasting efforts, but far more were found by other techniques, some of which required information not available to the public, such as DNS lookup errors. It was the lack of available information that motivated domain registrants, hungry for knowledge, to turn to the catch-and-release practice of tasting in the first place. So tasting today is primarily aimed at the daily batch of deleting expired domain names, for which there is a great deal of competition. Since domain registrants have many other methods of identifying the most likely targets, the tasting typically only comes into play for sifting through the "dregs" of the day's catch. And those expiring domain names without enough traffic to justify permanent registration will eventually, after one or two or three tasting periods, become available for public registration.

Second, associating trademark issues with domain tasting unnecessarily clouds the issue. Trademark issues are by no means confined to tasted domains, and while the fact that confused consumers commonly mistype the names of trademarked products means there are profit opportunities available in the corresponding domain names, domain tasters did not cause this confusion.

There are many clear cases of domain registrants abusing the rights of trademark owners, but domain names, tasted or otherwise, cannot be conveniently divided into distinct classes of those that do and do not violate trademark rights. There are undoubtedly many more consumers of apples than of the products of Apple Comuter, Inc., yet "apple" is not only a trade name but a registered trademark in many product classes. So it is with nearly every common word or phrase. Whatever it is, seemingly, someone, somewhere has named their product after it, and in many cases applied to register the mark. Every time a consumer types a trademark URL into their web browser, whether spelled correctly or incorrectly, only they know "where" they wanted to go.  It may have been to find an obscure product that only one in a thousand uses of the term refers to, or it may have been a generic use of the term. Often domain registrants register domain names consisting of common words or phrases they thought were generic, only to discover many visitors looking for a trademarked product. These issues are complex, not unique to domain tasting, and addressed by existing policy and law.

Third, even in the case of an obvious trademark such as Verizon, once a consumer either spells the name incorrectly or combines it with other words not anticipated by Verizon, they are confused. No further action on the part of domain registrants, browser vendors, search engines, ISP's, or registry operators is required to mislead them.  Years ago they may have received nothing but an unfriendly error message, but today there are many mechanisms in place designed to "help" them find what they are looking for. Some of these mechanisms work better than others, and some are implemented with more altruistic motives than others, but "someone" is going to have the opportunity to redirect the lost visitor. Again, this situation is not unique to domain tasting.

And finally there is the resource drain on the registries and registrars as the domain tasting occurs. Verisign is not complaining, and it has been pointed out that they are profiting from the activity. The registrars must not have a problem with it, or they would not allow it to happen. Some have turned it into a profit center. Apparently the issue of domain tasting is a non-issue among the parties most intimately involved.

It isn't difficult to spin domain tasting into an evil monster threatening the survival of the Internet, but in reality it amounts to nothing more than what it is - a private arrangement between registrants, registrars, and registries which ultimately has no discernible effect on the general public.

Re: Domain Tasting in the Spotlight By Karl Auerbach  –  Dec 28, 2006 8:46 pm PDT

Responding to Chuck Hatcher's conclusion that tasting is "a private arrangement between registrants, registrars, and registries which ultimately has no discernible effect on the general public."

I do not believe that we have the information to support that conclusion.

We do not know how much it costs a registry to handle a registration transaction, tasting or otherwise.

It may be that the general public, via its payment of full term registration fees, is subsidizing the tasting industry.

It may be that the tasting industry, via its deposits with registries is subsizing the general public and full term registrations.  (Although I doubt that this situation obtains.)

It may be that actual registration costs are so low as to be nearly vanishing, in which case there is a serious question of why ICANN requires us to pay a registration fee of $7+7% for something that ought to cost a few cents.

And there is the question of to what degree the churn from tasting burdens the registration systems, making the net less responsive to registrations from full-term users and perhaps even more susceptable to "instability" because the zone files are changing more rapidly and to a greater degree than would be the case were they updated only for registrations intended to last full-term.

All-in-all, there is an information vacuum about the actual costs of the registration system and the susceptabilities of the name servers and registration systems due to the churn of the reported 200 to 1 ratio of tastings to full-term registrations.

Without that information it is not possible to reach conclusions.

And without that information ICANN's board was derelict in its duty of informed decisionmaking when it approved the recent round of registry fees.

Re: Domain Tasting in the Spotlight By John Berryhill  –  Jan 01, 2007 3:16 pm PDT

Without that information it is not possible to reach conclusions.

Nail. Head. Bang.

Re: Domain Tasting in the Spotlight By Ricardo Vaz Monteiro  –  Mar 20, 2007 5:34 am PDT

Many domain tasters NEVER pay for their domains. They taste, delete and reserve thousands of domain names in a endless cicle, and they SUBVERT the 5 days grace period to do that, that practice must be condemned.

Best,

Ricardo Vaz Monteiro
Registro de dominio

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