Interesting article in eWeek about the business of registering domain name typos and how they game Google. "Some of the domains move around between domain parking services or between anchor domains over time as part of a 'multi-layer redirection structure' that makes it difficult to trace". The bulk of the data and analysis comes from Microsoft Research. Again, I'm not going to "judge" this business, but clearly it's a large business that is becoming exceedingly complex with some cat-and-mouse going on. One thing I wonder about is whether there is a whole lot of incentive for the cat to catch the mouse if the cat gets a share of the mouse's take.

ICANN

NEXT STEPS ON PROPOSED .COM SETTLEMENT On 21 October 2005, ICANN announced proposed settlement terms between ICANN and VeriSign, including a proposed new .COM agreement. Since then, ICANN has been conducting extensive public consultations on the proposed settlement. At its 24th International Public Meeting in Vancouver this week, the ICANN Board has been engaged in consultations with the ICANN community on this topic, among others.

Today at its Board meeting, ICANN Chairman, Vint Cerf, announced:

"The Board has listened long and hard this week to all constituencies with regard to the .COM agreements

"We are deeply grateful to the efforts made by all constituencies to respond to the Board’s invitation to organize comments on the proposals and to provide, where possible, concrete suggestions for improving them.

"We are also very grateful for the time each constituency spent going over with the Board their ideas and reactions.

"We ask the staff to accept any further written comments until December 7 and to produce for the community a public report summarizing, analyzing and organizing the feedback provided on the .com and settlement agreements by December 11.

"We recommend that staff approach VeriSign with the results of the report on the proposed contract and settlement. We remind all parties that the Board has not yet agreed to the terms of the contract and settlement.

"We also note the existence of a policy development process on new gTLDs and strongly believe that this policy development process should be informed by the results of the comments received on the proposed contract for .com and settlement with VeriSign."

Yesterday, I wrote a post about the parked domain monetization business. Since then, I've begun talking to a variety of people here at the ICANN meeting. It is clearly a complex issue and I have decided to suspend judgement until I have more information. I think that these "professional registrants" are clearly a different group than "user registrants". I think we should differentiate people who buy domains as their primary business to people who use domains to use in their business. It could be argued that professional registrants "use" their domains to run ads, but I think most of these professional use tools like Google AdSense for domains which automate the process and does not require the professional to engage in the business of actually running a web site or service.

I am going to try to gather as much information as possible before I come to any conclusions. I urge people, especially those people who are in this business, to help me understand the issues and nuances. I've just started a page on the ICANNWiki about this. Please contribute there as well. Thanks.

I think that a large number of people buying domains can't get their first choice name because some "parked domain monetization" operation (cyber-squatter) owns it and is making money running ads on the page. The trick is to sign up for millions of domain names; set up pages and run ads on them; after 1 day delete domains that have no traffic; after 3 days delete names that have some traffic; after 5 days delete pages with marginal traffic; keep the 1% of pages that have enough traffic to be worth keeping the domain. Because of the refund policy, the 99% of pages deleted before the 5 day grace period are refunded in full and the "monetizer" gets to keep the ad revenue generated over those 5 days. (This is called "domain tasting".) See the DNForum page for more information on how this business works. Interestingly, I think Google AdSense probably has boosted the viability of this business. I wonder what percentage of Google's posted $2bn (or so) / yr "traffic acquisition costs" goes to this business. According to Ram Mohan from Afilias, 3 of the big 5 registrars say that they make over $5m-$8m / year from parked domain monetization pages. This means that these people are making more than that from these pages and Google and other ad servers even more.

I wonder if there is any way to close this loophole that effectively enables a no-risk business. I think these monetization businesses are a net-negative value to the community and seems like a loophole exploit. On the other hand, refunds are a legitimate service for legitimate registrants. It is VERY difficult to tell the difference between a legitimate and illegitimate registrant.

In the jungle of such pages, the Kevin Kelly page stands out as my favorite example of responsible domain name use.

UPDATE: WSJ November 17, 2005: "Revenue from text ads on these sites will total $400 million to $600 million world-wide this year and may reach $1 billion by 2007, according to Susquehanna Financial Group analysts Marianne Wolk and Roxane Previty, who track the online ad industry."

UPDATE: Google has an AdSense page targeting domain name parking businesses. I wonder if these Google folks will talk to us? They should know the size and shape of the "professional registrant" community better than anyone else and it appears they are "taking to them" directly from the looks of this page.