[At-Large] FW: [alac] Re: Domain Monetization Background

[Nick Ashton-Hart]

I'm happy to get a revision done to the report I sent out incorporating
these points if that's thought useful.

On 17/02/07, Roberto Gaetano <roberto at icann.org> wrote:
>
>
> I believe this is the message that John sent to the alac public list about
> the domain name monetization.
> RG
>
> (didn't ask for explicit permission, but since it was sent to the public
> list I assume it's OK)
>
>
> -----Original Message-----
> From: owner-alac at icann.org [mailto:owner-alac at icann.org] On Behalf Of John
> L
> Sent: 21 August 2006 05:50
> To: ALAC
> Subject: [alac] Re: Domain Monetization Background
>
> Thanks for that useful summary. There are a few other points that are
> worth
> bringing out:
>
> One is that there is a meaningful difference between domain monetization
> and
> domain tasting.
>
> Monetization is a straightforward arbitrage between the cost of domain
> registrations and the revenue from as much pay-per-click traffic as the
> domain owner can get from people who visit web sites in the domain.  It's
> a
> fundamentally sleazy business, since the web sites have no useful content
> and the way they get the traffic is basically by tricking people, either
> via
> typos or recently expired domains.  But it's not the only sleazy thing
> that
> people do with domains, and it is not at all obvious to me why ICANN
> should
> do something special about this particular flavor of sleaze.  If
> registrars
> are warehousing domains in violation of sections
> 3.7.4 and 3.7.9 of the registar agreement, I suppose that ICANN should
> slap
> their wrists, but that's trivial to circumvent by creating a nominally
> separate customer to hold the domains.
>
> If we agree that this is a bad idea, it would be much more effective to
> persuade Google and Overture to stop paying for clicks on pages with no
> content, thereby dealing with a problem that is not limited to typo and
> expired domains.  We've seen click arbitrage, people buying Google ads to
> drive traffic to pages that are simply other Google ads.
>
> Domain tasting, on the other hand, uses the five day add grace period to
> register domains without paying for them.  It stops being arbitrage and
> instead is somewhere between larceny and extortion, because the
> registration
> cost is zero. As many people, most eloquently Bob Parsons, have noted,
> it's
> exploiting a loophole that shouldn't be there in the first place.  There
> was
> a great deal of debate both in the ICANN community and on the ICANN board
> about the deletion grace period, but none at all about add grace which was
> apparently tossed into the package by an ICANN staffer without asking
> anyone.  So says Karl Auerbach, who was on the board at the time, and I
> haven't seen anything to the contrary from any other board member.
>
> The usual explanation of domain tasting says that the registrars register
> millions of domains, watch the traffic, and then after 4.9 days they
> delete
> the ones that don't seem likely to make back the six bucks.  I wouldn't be
> surprised if they just delete them all and then reregister what they can a
> few minutes later.  The domains are all nearly worthless, so why take the
> risk of paying anything for them?
>
> The add grace period is just a mistake.  The problem it purports to solve
> is
> not and never was an important one.  If you let an important domain
> expire,
> you risk losing the entire investment made in that domain over many years.
> But if you register a domain by mistake, the most you risk is the ten or
> twenty bucks you paid to register it.
>
> Finally, it was completely predictable that people would abuse the ability
> to register domains for free.  Back in the pre-ICANN days you registered a
> domain by sending mail to NSI, they sent back the confirmation, then you
> had
> several weeks to send them a check before they deleted the domain for
> non-payment.  Pay per click hadn't been invented yet, so the abuse at that
> point was to squat on domains with interesting looking names and try to
> sell
> them before they were deleted.
>
> R's,
> John
>
>
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>



-- 
-- 
Regards,

Nick Ashton-Hart
PO Box 32160
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