Re: Warehousing, TM violations & the new gTLD's

["andi payn" <payn@null.net>]

>> One approach might be to reduce the profit motive for warehousing by
>> recognizing that all domain names do not have equal value (for example
>> movies.com vs qksiosduqq.com) and not charging the same price for them.
>> In essence, having an open auction for highly valued names.
>
>In a sense, I agree with this.  But isn't that what it amounts to when
>someone, anyone, offers a name for sale on the "market"?

I'm not sure if you're talking about a registrar (or the set of registrars
who share the gTLD in question) offering the name for sale or a
warehouser... First I'll assume you're talking about registrars.

In that case, the difference is that, in most of the proposed systems, each
registrar would presumably be offering all SLDs under a gTLD for a single
price (which might not necessarily be the same as another registrar's price,
of course).

There's no reason a registrar could decide to set a higher price on a
particular SLD, but under a shared gTLD system (which is what I'd like to
see, as I've said many times) that would really be pretty stupid unless all
of the other registrars did the same.

In my response to the NTIA request, I suggested that if a gTLD's charter
calls for an initial SLD auction (an idea I got from Simon Higgs' initial
draft, and which I've mentioned here a few times), winning an auction should
only win an entity the exclusive right to use that SLD; they'd still have to
contract with a registrar to actually register the SLD.

If you're talking about the difference between an official auction and an
auction by a warehouser, there's at least one major advantage. An official
auction would have an official time limit (72 hours, 5 business days, 30
days, 3 months, whatever), after which point whoever's bid the highest will
get the name--and if nobody's bid, the name will go into the normal pool. A
warehouser will not sell the name to the highest bidder if she doesn't get
enough money.

Of course in theory the 90-day grace period sets a limit to the auction,
because after 90 days the warehouser has to pay $100 or give up the name.
However, if the auction's getting close to what she wants, she may decide to
pay and hang onto it and wait for the price to go up... at which point the
time limit becomes one year...

Also, as we all know, with NSI, theory isn't always practice, and many
people have stories about holding onto names for much longer than 90 days
without paying... However, from what I've heard, they've turned that around
significantly in the last year or so.

>The only substantial difference is who makes the money.

That's actually one of my big questions with the whole auction idea... I'd
assume the money would go to some sort of fund used for root server, TLD
server, and/or other maintenance costs. Which is, in my opinion, more useful
to the Internet as a whole than the benefit of warehousers getting rich just
for winning the race for "business.biz" and "business.web."

>So someone is first to think of a great name, first to register.  So
>what?

If someone really thinks of a great name that nobody's thought of yet and
registers it to warehouse and sell it, I don't see a problem with that.

The big problem is when people register trademarked names (intel.org) to
sell them to trademark holders.

There's some problem, although not as severe, when people register
incredibly common and obvious names (business.com) to sell them to the
highest bidder. The problem is that they're profiting just for winning a
race--that is, they're profiting without creating any kind of value.

In many (but not all) of the land rushes that the US held in the past to
settle frontier territory, people were not allowed to sell the land they'd
claimed for a certain time period, or were even forced to work the land or
live on it. There may be some analogy that makes sense here...

>I'll tell you something simpler and more d-able that will reduce
>warehousing -- simply require payment up-front.

I agree completely.

As an alternative, forbid the sale or other transfer of a domain name within
the first, say, 90 days, or 6 months.

>Presently, InterNIC (NSI) allows 90 days or so _after_ registration
>before payment is due.  Large numbers of names are registered
>speculatively with no intention of ever being paid for.  The speculator
>expects to sell it before it expires, but if not, it's no sweat.  After
>the 90 days (is it 60?) elapse without payment, the name goes on Hold.
>30 days later, given no payment, it is deleted and again available --
>often, I'll bet, for the next warehouser to snatch, perhaps even the
>same one.
>
>Talk about low overhead.  The inventory is free till it's bought.
>
>Perhaps NSI has implemented some form of discouragement of this
>practice, but if so, I don't know about it.

They claim that they've been enforcing the payment limit better, and that
seems to be true. They also claim that this has a significant effect on
warehousers; I'm a little more doubtful about that one.

-- andi payn