Is Domain Name Front Running About To Come To An End?

This Thursday, ICANN will vote on next fiscal year’s budget, and included in that is a provision to charge 20 cents per registration for domain names that are deleted during the grace period. There will still be a refundable grace period, but if the “level of deletions exceeds 10 percent of a registrar’s net new registrations in that month,” the fee kicks in—in effect, making front running uneconomical. Network Solutions is urging ICANN to approve it, and has said that it will stop pre-registering domains if the provision is approved.

On their official announcement page, Network Solutions writes,

If ICANN adopts the anti-tasting provision, Network Solutions will feel safe in discontinuing its service. Implementing a non-refundable fee during the AGP will deflate domain tasters’ profits and provide a substantial blow to front runners who use and sell search data for tasting purposes. While we understand and appreciate certain concerns initially raised about our protection measure and the way it was implemented, we are heartened by the fact that we successfully highlighted the issue and assisted in moving toward the eradication of these negative practices.

Of course, they also profited nicely from subsequent registrations due to their policy—it wasn’t simply an act of good citizenship. We also assume this means that pre-registering searched domains will no longer be profitable to Network Solutions—in other words, the policy will be discontinued mainly for economic reasons.

In a related discussion on Slashdot, solprovider points out that ICANN’s new policy may also put an end to what Network Solutions describes as “domain kiting,” where several (possibly related) companies keep passing domain registrations from one to the next by taking advantage of the free grace period, effectively preventing the domains from ever being available to the public. Solprovider points out that domain kiters may simply purchase the domains if the numbers make sense financially.

We’ll have to wait and see whether millions of trapped domain names become avaible in the near future—or if they’ll simply be registered for real by these companies.

“Network Solutions Encourages ICANN to Adopt Transaction Fee to End Domain Tasting and Front Running” [Network Solutions]
“ICANN to Add Anti Front Running Charge?” [Slashdot]

RELATED
“ICANN Posts Draft FY09 Operating Plan and Budget” [ICANN]

Comments

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  1. mike says:

    This is a great idea. Way back when I used to have an older domain, I accidently released it after it expired (forgot it expired) and some hosting company already stole it and said it was for sale.

    Sleezy

  2. Gopher bond says:

    I had a domain name that I let expire. A few days later, some company snapped it up and said it would let me have it back for $200. I told them they could keep it for all I care. A few weeks later I saw that it was made available again so I grabbed it for a few dollars. Then I sent a note back to the company that said I could have it for $200 telling them that I had been mistaken and that I really needed the domain for my business and asked if I could still get it at the $200 price.

    Ha ha.

  3. mac-phisto says:

    this makes me want to program a bot that will spam search random characters & bring the resellers to their knees! BWHAHAHAHA (maniacally)

  4. Bladefist says:

    I own like 20 domains, and I’m into this market, I’ll be happy to have this. Sick and tired of people messing around with these domains. I’d actually like to see something done about people parking domains for ads.

  5. Bladefist says:

    @Bladefist: I just realized after reading my comment, that I do domain parking too. nevermind. Damn hypocrite.

  6. Mr_Human says:

    @Bladefist: Ditto. And I need to explain to my friends that parking is different from squatting.

  7. Bladefist says:

    @Mr_Human: I hate both unless its me :)

  8. donkeyjote says:

    @testsicles: I like the cut of your jib, good sir.

  9. donkeyjote says:

    @Bladefist: Sue them, or start an icann resolution thing, and claim prior trademark, and that their domain squatting and extortion fee are trademark dilution, etc.

  10. donkeyjote says:

    @mac-phisto: You’ve been beaten to that. [www.reddit.com]

  11. TheNerd says:

    My husband’s band has been wanting the domain of their band name since 2001, and every year another big company has bought it and is filling it with adds and offering it for sale at an outrageous fee! I think there should be a cap on the price a domain name can be sold at, especially when they aren’t selling any of the content with it.

  12. donkeyjote says:

    @TheNerd: What’s the name?

  13. nycaviation says:

    20 cents will not stop front running. One (possibly fraudulent) AdSense click on your 20 cent domain and you’re already making a profit. If they really wanted to stop it the fee would be $5.

  14. donkeyjote says:

    @nycaviation: 20 cents per domain will eat into the adsense profit. Plus, its actually (Profit – (6~7 Dollars * purchased/kept domain) – (.20 * domains not kept))

  15. richcreamerybutter says:

    I always feel bad for the female subjects of the stock photos (because they always feature girls) used in generic domain squatting pages. It’s like they’re perpetually trapped in some kind of corporate ghetto Purgatory.

  16. azntg says:

    @donkeyjote: That’s assuming that the front runners don’t wise up and adjust their game to coincide before the new, shorter fully-refundable grace period.

    While I think this move is a step in the right direction, it could also potentially backfire on ICANN (in the form of increased volume of transactions, if all of them decide to wise up to this)

  17. donkeyjote says:

    @azntg: The time period stays the same. The penalty only goes into effect on volume. Once a registrar has refunded more then 10% of the domains they bought, they get hit with the penalty.

  18. surfphoto says:

    I really do hope this happens. I forgot to renew one of the domain names that I use as a side business and now a large reselling company has it.

  19. The resolution passed today!

    The live feed and full text logs can be found at:

    [ses1.penn.icannmeeting.org]