Domain name front running

Domain name front running

Domain name front running is the practice whereby a domain name registrar uses insider information to register domains for the purpose of re-selling them or earning revenue via ads placed on the domain's landing page. By registering the domains, the registrar locks out other potential registrars from selling the domain to a customer. The registrar typically takes advantage of the 5-day "domain tasting" trial period, where the domain can be locked without payment.

The term was created by domain investor and retired stockbroker Daniel Stager who likened the practice to front running, when a stockbroker illegally puts their own financial interests above that of their clients. ICANN has since picked up on the term.[1]

In January 2008 it was reported that Network Solutions uses data collected from their web-based WHOIS search to register every domain that users check for availability.[2] Although the practice forces users to register the searched-for domains from Network Solutions, Network Solutions defends the practice, claiming that "This protection measure provides our customers the opportunity to register domains they have previously searched without the fear that the name will be already taken through Front Running."[3] However, during the 4 day period the domain is still up for sale to the general public solely through Network Solutions and is not, in fact, reserved for a specific person at all.

In June 2008, Network Solutions proposed a small fee for domain tasting, in part to end the practice of domain name front running.[4]

References

  1. ^ ICANN probing insider trading" allegations with domain name registrations[dead link]
  2. ^ Domain Registrar Network Solutions Front Running On Whois Searches
  3. ^ Network Solutions Responds to Front Running Accusations
  4. ^ Network Solutions Encourages ICANN to Adopt Transaction Fee to End Domain Tasting and Front Running NetworkSolutions press release.

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