Hi, Here is a revised version of our comment (not resolution) on domain name tasting and monetization - not reallyclose to final, but work in progress, for your comments and suggestions, in the interest of time and quality. izumi ------------- ALAC COMMENT ON DOMAIN TASTING AND MONETISATION AND THEIR IMPACTS ON THE INDIVIDUAL INTERNET USERS Version 1.1, Mar 28 On behalf of the ordinary Internet users, the At-Large Advisory Committee (ALAC), with the input of the worldwide community of At-Large Structures, would like to make the following comments on Domain Tasting and Domain Monetization. We think Domain Tasting and Domain Monetization are two different issues, though some areas may have some relationship, and therefore we like to discuss them separately. The need to articulate the issue first for Domain Tasting We believe that Domain Tasting utilizing the existing Five-day Add Grace Period is an abuse that results in confusion of the ordinary Internet users worldwide and gives an unfair advantage to speculators. However, at this point of time, we feel there still needs more concrete information to prove these problems actually exist and are affecting the ordinary users. ALAC will work on drafting the formal request to ICANN staff to prepare the Issue Report. At the same time, we like to work together with other constituencies or groups who share the similar concern to come to consensus positions. Upon receiving the Issue Report by the staff, we shall make the final decision whether a formal PDP is necessary. Among the issues and actions we like to discuss are as follows: With the User Constituency, business and non-commercial: How to find the best ways to protect the interest of the end users, including that of registrants, but also that of general users who do not register domain names but just use domain names to communicate each other or find useful information on Internet. How to provide safeguards for the domain names they registered, what are the rights of the registrants, how to minimize confusion or exploitation of the ordinary users. With the Registrars Constituency: Consider implementation of a Registrars Code of Conduct that prohibits unfair speculation and exploitation of Domain name registration including the use of the five day Add Grace period. With the Registry Constituency: Consider how to avoid user confusion and unfair practices. Abolishing the five day add grace period could be one good solution. Adding a small fee, such as 25 cents per Domain to those registrants who keep names using the add grace period may be one solution, but we would need to be persuaded that this would solve the problem in order to endorse this as a solution. With ICANN Board: We ask ICANN Board to consider how best to prohibit unfair speculation, enhance consumer trust in the Domain Name registration system in the long run. Suggested actions could be: 1. Initiating a third party study on the impact of Domain Tasting and Domain Monetization/speculation and their impact on the ordinary Internet user community; 2. Initiating a review of Registry – Registrar Contracts in order to promote fair trading and restrict unfair speculation. Background and Rationale on Domain Tasting "Domain tasting" is the term used to describe the use of the five-day add grace period to register domains without paying for them and find those domains which generate certain traffic for pay-per-click advertisements. We think these are unfair acts: somewhere between larceny and extortion, because the registration cost is zero and the purpose of these registrations is just to make money by taking advantage of automated bulk registration to exploit the domain names, which are in essence 'public goods', and not the real property of anyone. As many people have noted, this practice is exploiting a loophole that shouldn't exist in the first place. There was a great deal of debate both in the ICANN community 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 we haven't seen anything to the contrary from any other board member. As Bob Parsons, CEO and Founder of Go Daddy, wrote in his blog: Millions of good .COM domain names – on any given day over 3.5 million and climbing — are unfairly made unavailable to small businesses and others who would actually register and use them in ways for which the names were intended. Many times businesses accidentally let their domain names expire. When they go to renew them, they find they have been snapped up – and taken away with a huge expensive hassle to follow – by an add/drop registrar. 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 US$6.00 registration fee. Often they just delete them all and then reregister what they can a few minutes later until they find the domains that produce enough traffic to yield a return well above the registration fee. 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 one registers a domain by mistake, the most one risks is the ten or twenty dollars you paid to register it. On Domain Monetization We note that there is a meaningful difference between domain tasting and domain monetization. Monetization is a straightforward arbitrage between the cost of domain registrations and the revenue from as much pay-per-click traffic as the domain owner 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. We do not think it is appropriate in this case to make ICANN as a regulator to watch and prohibit the Domain monetization practice per se. Instead, we call upon those commercial enterprises such as Google or Overture 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. This kind of self-generating traffic for pay-per-click advertising is confusing and unnecessary for ordinary Internet users and, in the long run, not healthy for the development of Internet as a whole. Since Domain monetization is a relatively new phenomena, the impact to the ordinary users and the Internet community at large is hard to measure at this point. We think it is worth to watch how it develops and may propose more specific actions when we have clearer understanding of measurable impact.