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29 Aug 2006
The ICANN ALAC, of which I am a member, has been thinking about what our position should be on domain tasting. (Since we are supposed to represent the interests of at-large users, i.e., everyone other than the special insterests, feel free to add your opinions.)
We started by trying to figure out what the problem is that we're worried about. There is a meaningful difference between domain monetization and domain tasting.
Domain monetization is a straightforward arbitrage between the cost of domain registrations and the revenue from pay-per-click traffic. The domain owner gets all the traffic he 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. All registrars are subject to a standard registrar agreement, and sections 3.7.4 and 3.7.9 of the agreement forbid warehousing domains. If the tasting registrars are in violation of 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 putting up junk pages and trying to get click traffic is a bad idea, it would be much more effective to persuade Google and Yahoo's Overture, the two dominant pay-per-click companies, 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.
Fellow ALAC member Jean Polly brought out a few more points.
Can we say anything else about how the loophole affects end users? How do all these millions of names affect traffic, either while they are live or after they have been abandoned a few days later?
It's definitely a stability issue, with millions of domains going into and out of the DNS every day, nearly every one of them a typosquat of some variety. I doubt that many users even understand that a typosquat is possible (a good topic for the Vint and Wendy survey team) and I expect that many will bookmark sites one click from the place they really want to be, then the squat goes away and the bookmark breaks. It also breaks typo correction by ISPs; many set their browsers on NXDOMAIN to visit ISP pages with suggested spelling corrections, but that won't happen if you land at a squat instead.
How much money is being lost by giving out "free samples" of domains during the add-grace period?
By the registries, probably some. By users, none, since the registries all have fixed price contracts. The people who run .ORG have moaned and groaned to me about the cost of handling all those adds and deletes, but I have not yet seen any registry coming to ICANN asking for relief. Apparently Verisign and Neustar tolerate tasting because they think it leads to more registrations, at least so far. Afilias, who runs the .ORG registry, has less robust infrastructure and has complained more.
Update: Ram Mohan of Afilias wrote to point out that despite the load that tasting has put on their registries, their registry performance has remained consistently good, which matches my experience. My point is that any money spent to deal with the extra load of domain tasting is money down the drain, since it should never have happened in the first place.
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