In a perfect Internet world, there would be no domain name extortion. The hoarding and reselling of URLs, a practice infamously known as cybersquatting, has cost California individuals and businesses untold millions of dollars.
The Internet Corporation for Assigned Names and Numbers or ICANN is poised to flood the virtual marketplace with new domain name suffixes. The addition of thousands of domain name endings will devalue the familiar dot-com suffix. Cybersquatters will no longer command a market of brand-nervous bidders and buyers.
Dot-com was never the only suffix available. Domain name cousins dot-net, dot-gov, dot-org and dot-“geographical location” never claimed the same U.S. fame.
Internet exploiters invest in low-cost dot-com URLs and spin them into quick profits, often by selling the names to companies defending a brand. Some URLs remain “parked” or undeveloped until the domain name becomes valuable.
Cybersquatting profits rose as dot-com availabilities diminished. Most of today’s dot-com domain names have been resold and recycled.
ICANN’s began accepting applications for thousands of new domain names over the last few years. Some companies jumped at the chance to shield Internet products and services. Other applicants are hoping to collect a stable of fresh, new-suffix domain names and become URL dealers themselves.
Cybersquatters operate in bad faith. The whole point of what they do is to make money from another person or company’s trademark. Thieves suck away a company’s revenues and profits while dealing blows to the business’s hard-earned reputation.
Many cybersquatters use software to detect domain name registration lapses. Thieves snap up the URLs the moment a domain name is available for purchase, a practice sometimes called alert angling or renewal snatching.
One of the first lines of trademark defense involves vigilant re-registration of personal or company-owned domain names. An intellectual property lawyer will help devise strategies to prevent cybersquatting, a job that could become easier once ICANN’s new suffixes are in use.
Source: washingtonpost.com, “‘I have a domain name to sell you’ is a terrible business proposition” Lydia DePillis, Jun. 20, 2013