Writings on technology and society from Wellington, New Zealand

Tuesday, May 6, 2008

There’s No Accounting for taste

…or de gustibus non est disputandum as the Latin tag has it. But tasting has been a problem on the Internet for some time now.

Domain name tasting is the practice of buying a domain name, putting up a web site with advertising on it, and not paying for the name when the bill comes in a week later if the advertising doesn’t show a profit.

It works likes this: You think up a name that people might type – it might be close to the name of a popular site – let’s say it’s – then you point it at a website full of ads. You get paid when people click on the ads on the site. Under the rules for domain name purchase there is a so-called “grace period” during which you can cancel your registration for a full refund. So, at the end of the grace period you figure out whether the costs of holding the domain outweigh the ad revenue.

Some registrars in the US are doing something like a million names at a time and canceling 99% or more at the end of the grace period. They can automate the whole thing so it’s pretty much untouched by human hand. Then they just wait for the money to roll in. And it’s a really bad practice because it takes the opportunity of names away form people who might have a valid use for them – John Goggle, for instance – and it places huge loads on the registration systems which pushes up everyone’s costs.

One way to kill this off would be to get rid of the grace period on domain name registration, so all registrations would be immediate and final and paid in full. But the grace period is kind of useful to ordinary users and it’s a shame to see it so abused.

Instead, ICANN looks likely to limit tightly the size of a refund that a registrar can claim in a month, which is quite clever, because this is a game of large numbers and this should stop it. It should also stop the practice of ‘front-running’, where you ask about a particular domain name – only to discover that the registrar you have just asked has automatically registered it on your behalf as soon as you asked, and you can’t register the name using a competing registrar until after the grace period.

None of this has been a major problem for dot nz names, possibly because we have a smaller market than dot com, but mainly I think because we have a strong regulator.

posted by colin at 7:18 am  

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