In my last entry, I blogged about domain registrar Network Solutions holding domain names after being searched on their website but not taken on the spot.

A few days have passed since then. There’s a lot of talk online, and a lot of changes have taken place.

As a recap, if you go to Network Solutions’ website, search for a domain name, and find it available but don’t register it on the spot, they’ll register it and put it into what I call a “holding account”. Their Vice President for Policy, Jonathon Nevett, has stated they’re doing this to protect their customers (well potential ones, anyway) against “domain front runners”.

I actually made a slight error in previously saying that domain front running is the same as domain tasting. Domain front running was defined as the following by the .uk Registry Nominet:

http://blog.nominet.org.uk/insight/2007/11/domain-name-front-running/

Domain Name Front Running (DNFR) is a new buzzword acronym for the alleged practice of monitoring someone’s intentions to register domain names and then jumping in and registering them first.

Apparently the definition above was derived from the original practice used by stock brokers:

http://en.wikipedia.org/wiki/Front_running

Front running is the illegal practice of a stock broker executing orders on a security for their own account (and thus affecting prices) before filling orders previously submitted by their customers. After the broker has made their original transactions, they can expect to close out their position at a profit based on the new price level.

For example, if a broker buys 20,000 shares of a stock for $100 per share just before buying a large block of 400,000 shares for a customer, they may drive the price up to $102 per share. If the broker is able to sell their newly purchased shares at $101.75, they will have made $35,000 in a few minutes. This $35,000 is likely to be only part of the additional cost to the customer’s purchase caused by the broker’s self-dealing.

Subsequently one of ICANN’s working committees adopted that in their report:

http://www.icann.org/presentations/ssac-la-dnfr-30oct07.pdf

The PDF basically reported that there are numerous complaints of domain front running happening. But they want some tangible proof to verify such and prevent this issue from becoming one of perception.

This is mostly speculation, but people in the industry believe that front running occurs to engage in domain tasting. So while the two activities may be interrelated, let’s be clear that they’re not equal.

So what has happened since Network Solutions began this practice? I’ll start by explaining what I found about them.

First, Network Solutions have finally added a portion discussing their “customer protection measure” on their website’s storefront. It’s at the middle right, can’t miss it.

If you click on it, it redirects to another page giving a more detailed explanation what it is, why they’re doing it, and what happens. About time, considering that various companies don’t seem to put those sorts of things on their front page.

Second, I conducted another test by searching for a domain name through their site, but didn’t take it on the spot. As of this post, the domain name doesn’t display any website whatsoever.

I’d say that’s far better than what Network Solutions originally did when they placed a commercial page that redirects the user directly to their site to register it. As far as I know, they’ve never put any commercial parking pages on any of those domain names at any time.

Also, they indeed release searched domain names from their holding account after about 4 days. The one I originally tested is now available as of this post as well.

Finally, their own CEO Champ Mitchell finally made a statement online. This one especially got my attention:

http://www.infoworld.com/article/08/01/10/Network-Solutions-stands-by-name-policy_1.html

Mitchell added that if ICANN (Internet Corporation for Assigned Names and Numbers), the organization that oversees the domain name system, would move to cut down on these type of scams, then his company wouldn’t have to engage in this kind of automatic search registration. “We would be perfectly happy to end this process if ICANN or the registries would do something to protect small businesses or other small users,” he said.

Well, since they indeed drop those reserved domain names within that 4-day period, I guess they really will stop this current practice once ICANN or VeriSign resolves this pesky domain tasting an d front running issues. The sooner, the better.

I must say I’m not really surprised with the kind of talk online about what Network Solutions is doing. They’ve been labeled all sorts of things, anything from crooks to scum of the earth to an evil empire bent on taking over the world.

Personally, I find it sad that many of them don’t appear to take into consideration the larger issue that Network Solutions is dealing with using this approach. Network Solutions has pissed off a lot of people in the past (and until now, anyway), but I wonder if people can deny the problem the registrar is dealing with as their competitor Go Daddy is.

Speaking of Go Daddy, they themselves reported the same things happening to them and getting flak for it. They reported it in a previous ICANN meeting at Marrakech, Morocco:

http://www.icann.org/meetings/marrakech/captioning-dn-27jun06.htm

Since it’s pretty long, though, I’ll quote only a few relevant portions:

As I stated earlier, godaddy does feel that using the add-grace period for domain-tasting is a problem.
That is an abuse.

But what our primary concern is, that it’s creating customer confusion, that it’s threatening consumer confidence in our industry, and that it’s costing—it’s causing increased support costs for registrars, definitely for Go Daddy.

Like I said in my entry before this, a few insiders I know in the business confirm it’s happening to them as well. Unfortunately they’re getting the flak for it, even though they’ve not really done anything wrong to cause this.

One thing I’ll complain about Network Solutions’ practice, though, is they didn’t disclose this on their site anywhere before they started it. It took a lot of negative publicity to finally compel them to make the appropriate changes.

OTOH, I finally found this blog from one of Network Solutions’ own people, Shashi Bellamkonda. I must say that that blog shouldn’t necessarily be used for support issues, but instead a place to voice your feedback on certain things about the company Shashi works for.

It turns out Shashi has been busy posting on a lot of online places, especially forums and blogs. Thanks for making efforts to reach out on behalf of your company, Shashi, and kudos on handling the flak you yourself have been getting from people.

One thing’s for sure: Network Solutions has generated a lot of publicity for their company with this latest approach. Then again, any publicity is good publicity, right?

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