[Infowarrior] - DNS shows signs of stress from financial maneuverings

[Richard Forno]

Domain Name System shows signs of stress from financial maneuverings
Patrick Thibodeau
 http://www.computerworld.com/action/article.do?command=viewArticleBasic&art
icleId=289466

April 16, 2007 (Computerworld) Cybersquatting ‹ the practice of registering
Internet domain names that poach well-known trademarks ‹ is profitable for
just about everybody involved. Money is made off of registration fees and
advertising, and even the regulator of the Domain Name System gets a piece
of the action.

But it¹s not so lucrative for corporate officials like Lynn Goodendorf, who
heads global privacy at InterContinental Hotels Group PLC.

The Windsor, England-based company owns seven hotel chains, including
Holiday Inn and Crowne Plaza, with more than 3,700 properties worldwide.
Each day, Goodendorf gets about 100 e-mail alerts concerning potential
trademark infringements from three different domain monitoring services.

Goodendorf said that in most of those cases, she doesn¹t know the identities
of the potentially infringing domain holders. Their registrations often are
private, and when identifying information is available, it may be
inaccurate. Subpoenas are sometimes needed to uncover the identities of
individuals, she said.

Defensive measures, such as registering domain names that cybersquatters
might target, can help, but only to a point. ³We have tried to register
common misspellings or to have letters transposed,² Goodendorf said. But
it¹s impossible to anticipate every name combination, she added, citing the
cybersquatting site capitolholidayinn.com as an example.

Speculators Rule

As Goodendorf¹s experiences illustrate, the Domain Name System is showing
signs of being out of control. Speculators now use automated software
systems to re-register large batches of expired domain names. They¹re also
helped by a loophole in the registration process that lets domains be tested
for their potential profitability as pay-per-click advertising sites during
a free five-day ³tasting² period.

The World Intellectual Property Organization warned in a report issued last
month that those practices threaten the interests of trademark holders and
are causing confusion among Internet users. Francis Gurry, deputy director
general of the Geneva-based WIPO, said in a statement that the new methods
³risk turning the domain name system into a mostly speculative market.²

Gurry added that instead of being used to identify specific businesses or
other Internet users, ³many [domain] names nowadays are mere commodities² to
be bought and sold.

It¹s already possible to make astonishing sums of money selling domain
names. Domain Name Journal, an online magazine published by Internet Edge
Inc. in Tampa, Fla., reported that diamond.com fetched $7.5 million from a
buyer last year and that vodka.com sold for $3 million.

What makes generic names such as those valuable is so-called type-in traffic
from users who enter generic Web address names into their browsers to see
what turns up, said Frank Schilling, a domain name investor and blogger who
lives in the Cayman Islands. Schilling claims to own several hundred
thousand domains, including generic ones such as antarctica.com.

Domain investors such as Schilling draw a sharp distinction between what
they do in registering legitimate generic names and the actions of
cybersquatters who register domains that use or closely resemble real brand
or company names, such as microsotf.com.

That misspelled domain name was registered through EnCirca Inc., a registrar
in Woburn, Mass. Private registration policies keep the domain owner¹s name
and contact information hidden from public view. EnCirca does provide a Web
interface for e-mailing the owner of microsotf.com, but a note sent by
Computerworld received no response.

Citing the software advertising on microsotf.com, Tom Barrett, EnCirca¹s
president, said he would call the use of that domain name cybersquatting.
But Barrett added that he doesn¹t have the power to do anything about the
name or the Web site without exposing himself to possible litigation.

Asked about microsotf.com, a spokeswoman for Microsoft Corp. said the
software vendor wouldn¹t comment about a specific domain. But Microsoft
announced last month that it had filed lawsuits against alleged
cybersquatters in the U.S. and the U.K. The company also said that it had
reclaimed more than 1,100 infringing domain names worldwide over the past
six months.

Frederick Feldman, chief marketing officer at MarkMonitor Inc., a company in
San Francisco that registers corporate domains and offers a variety of brand
protection services, said a recent audit of 25 leading brand names found
nearly 45,000 pay-per-click ad sites that use one of those 25 brand names in
some way.

Fixing the domain name problems isn¹t simple. For instance, private
registrations protect domain holders from things such as identity theft. And
trademarks aren¹t always black and white. Domain name holders have
complained of ³reverse cybersquatting,² in which a trademark holder attempts
to gain control of a name that the domain owner considers to be a generic
term.

Jason H. Fisher, an attorney at Los Angeles law firm Buchalter Nemer Fields
& Younger, said the biggest obstacles to fixing the Domain Name System are
its international nature and the reluctance of the Internet Corporation for
Assigned Names and Numbers to take action. Fisher said ICANN ³would rather
do nothing than make waves.²