The Road that Led to Domain Tasting

While I’m certainly not the first to blog on the subject of domain tasting, a.k.a. domain kiting, I wanted to chime in on the subject as someone who has managed domains from not only the reseller and registrar perspective, but as the registrant of my own domains. I hope this helps to clarify the issue for some of you.

First, a little history for those not completely familiar with the topic. On March 15, 1985, now-defunct computer manufacturer Symbolics, Inc. registered symbolics.com, the oldest still-registered .com domain. Creation of the World Wide Web was still four years away and Verisign wouldn’t exist for another decade, but that first registration was the beginning of the booming domain registration industry¹.

Changes to the domain registration system that would eventually lead to domain tasting did not occur until the late nineties. First, the creation of ICANN on Sept. 18, 1998, allowed for competition in the domain name industry. By the end of the twentieth century the cost for .com domains to dropped from $50 annually to $35 and, finally, six dollars a year. Before the end of ICANN’s first year, an agreement between the government-mandated non-profit and Network Solutions — then the .com registry — led to the creation of the Add Grace Period (AGP).

The AGP allows registrants to delete a domain name within five days of registration. The policy was created in response to demands from consumers who had incorrectly spelled their desired domain name during the registration process. While it is a very customer-service oriented policy, the AGP unintentionally led to the creation of the domain tasting industry.

My first near-encounter with domain tasting would come in August 2003, when EV1Servers became a reseller for Canadian-based registrar, Tucows. We sold domains for $5 a year, a great less than any other company offered .com domains at the time and a good amount less than we paid for them. Our hope was that the low price would drive registrants to our Web site, who would then lease dedicated servers for less than we would normally spend on pay-per-click advertising.

The low price did drive traffic to the site from potential server customers, but it was even more attractive to domain portfolio managers. These are companies that register thousands of domains and park ads and links on them, capitalizing on type-in traffic from those individuals either unaware of or averse to using search engines.

The companies who have since emulated the loss-leader domain strategy are careful to include terms we didn’t realize were necessary, like requiring the purchase of hosting, or increasing the price of renewals. Our policy allowed anyone to register as many domains as they desired, no strings attached – a lesson learned. Domain tasting employs a similar strategy. While portfolio management is considered a legitimate business, many consider domain tasting less so. They register thousands of domains and, like portfolio managers, aim to capitalize on type-in traffic. The difference is if they discover the traffic is less than favorable before the five days are up, the domain is deleted and the domain taster is refunded the cost of the domain.

It sounds like a harmless process. The domain goes back into the pool of domains available for registration and the domain taster moves on to another collection of thousands of domains. A look at ICANN’s numbers, however, reveals a practice that is out of control. Of the 1,784,772 .org domains registered by five registrars in January 2007, only 10,862 were retained after the grace period. That same month 47,824,131 .com and .net domains were deleted before the end of their grace periods.

Although there is come concern regarding domain tasting’s impact on the overall stability of the Internet, the real victims of this practice are not ICANN, the registries or registrars, but rather the registrants for whom the policy was instituted to protect. Domain tasters do not limit their potential business to newly registered domains. In fact, dropped names — names that were once registered, but were deleted from the registry upon deletion — are much more valuable to tasters than new names.

Registrants who are naïve about the domain registration system often fail to recognize the importance of keeping administrative contact information up-to-date. As a result, they miss their domain renewal reminders. Not wanting to pay redemption fees that have been known to top $300 (another practice under scrutiny), they assume they can simply wait until the domain has expired and register it again. When the domain is deleted they are shocked to find it registered by a company who will either keep the domain for the traffic it generates, or offer to sell it back to the registrant for ridiculously inflated prices.

ICANN and the various registries are working toward a solution for this broken process, but how do you balance the needs of the registrant at the time of registration and during accidental deletion? To most businesses it’s an insignificant loss, but to an individual running a site for charity or a student just cutting their teeth on the hosting industry it can be devastating.

I look forward to the eventual solution of this problem. In the interim, if you find yourself a victim of domain tasting, there are a few tricks that may help you get your domain back. First, whatever you do, do not visit your former domain name’s URL.

Traffic to the domain will only increase its value in the eyes of the taster. Also, do not contact the company that has registered your domain. Any perceived interest in the domain may drive the taster to put the domain up for auction. Simply wait five days and attempt to register the domain again.

If you find at that time the same taster still has your domain you need to decide if you’re willing to pay a large amount of money to get it back. In some cases you may be able to prove the domain is your intellectual property and use ICANN’s Universal Domain-Name Dispute Resolution Policy to regain ownership. Bear in mind this is a long and often expensive process. If a different taster has the domain, repeat the same process as above for as long as is necessary.

- Brooke

1. Source: ICANN

This entry was posted on Wednesday, August 8th, 2007 at 5:00 am and is filed under Marketing. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.