For more than a decade, an Irish company called NetFocus has provided remote support and monitoring for its clients. There's another NetFocus in Springfield, Missouri, providing nationwide dial-up access. And there's yet another IT specialist called NetFocus in Ayreshire, Scotland.
Care to guess which NetFocus snagged the coveted dot-com domain for its company Web site? It's not the Irish company--that company is focused on serving a local clientele, and it quite rightly chose a regional domain, netfocus.ie. It's not the dial-up company, either. Since it offers network services, it wisely chose the dot-net version of the domain. And the canny business-minded Scots went for netfocus.biz.
No, netfocus.com went to RareNames of Washington, D.C., which doesn't operate a company called NetFocus. Through its broker BuyDomains.com, it is offering to sell the name for a paltry $14,400--a markup of more than 100,000 percent. Is that legal? Is it ethical? Who knows? But if someone desperately enough wants a domain that's up for sale, that's what they have to pay. That's what supply and demand is all about, folks. And there's a class of people that says that if you don't like it, well, you just don't get capitalism.
For those of you who missed the lesson, the various top-level domains actually used to mean something. A dot-com was a commercial venture, a dot-net was a network, and a dot-org was a nonprofit organization.
I don't want to argue that point at all. But how can domain dealers possibly justify doing this with dot-org domains? For those of you who missed the lesson, the various domains (.com, .net, .org, and everything that came afterward) actually used to mean something. A dot-com was a commercial venture, a dot-net was a network, and a dot-org was a nonprofit organization. Sure, the waters have been muddied (mostly by up-selling domain registrars who wanted to triple their sales by selling you a marked-up package of all three domains).
But a dot-org is still a dot-org, and I don't think that these domain names belong in the same aftermarket place as a dot-com. Some nonprofits may have more money than for-profit companies, but that's not the point. The point is that they're not seeking profit from their venture, and for other people to seek obscene profits from them is just sleazy. Ick! I feel like taking a shower just thinking about it.
One nonprofit's tale
I recently spoke with the director of technology at a moderately large and long-standing nonprofit organization about her travails in the domain resale market. Due to embarrassment, she didn't want to be named (let's call her Carole, not her real name), but she wanted to talk about her experience. It all began when she set out to register the full name of her nonprofit group as a dot-org. The organization's existing dot-org domain was a little cryptic, and it was proving tough to brand, so she sought an easier-to-remember site address.
Step one was to pump the potential new domain name into a browser address bar to see if anyone else had it. Someone did, and they were reselling it through BuyDomains.com. But when Carole clicked the link for a quote, she first got her twinge of regret about the whole domain shopping experience.
"You get a form to fill out to apply for a price quote, and you can't submit it without accepting the terms and conditions," she said. "BuyDomains wants you to agree not to sue them and relinquish all kinds of rights. I'm sure no court would uphold that, but if you don't agree with them, you don't get a quote."
For the record, this is part of the language in the agreement:
"I do not claim, or represent any person who claims, any copyright, trademark or other right to the domain name(s) about which I am seeking information, or if I do claim or represent someone who claims such rights, I do on my own behalf and on behalf of any person who I represent hereby waive such claims and release BuyDomains, LLC and it's [sic] its parents, subsidiaries, successors, assigns, attorneys, contractors, agents, employees, officers, directors, shareholders, and affiliates from any and all claims arising from such rights."
Yes, there is a typo and some repetition in that sloppily written agreement. But that presumably doesn't dilute its legal strength. And if you want to get your hands on a domain in this aftermarket, you have to swallow your pride, even if the company has typos in its legal documents. And that's exactly what my contact did.
The price isn't right
The news wasn't so good.
"They e-mailed us a quote for $1,200. That was a lot more than I was comfortable paying. I mean, this was our name. They may have registered it, but we had this name before there was an Internet. So I sat on this e-mail for a month and resubmitted a request, thinking it would be lower."
The price wasn't any lower, so Carole replied that she was unwilling to pay such an exorbitant amount. She low-balled BuyDomains, offering a third of the asking price, which still amounted to several hundred dollars. She didn't think the company would bite because the initial quote says that the amount is nonnegotiable. But it did. The next thing she heard from them was an e-mail saying, "Congratulations."
"The whole thing rubbed me the wrong way," she said, "It struck me as unethical...on the surface, it just wasn't right. I contacted our attorney. The attorney agreed it seemed to be illegal."
So she sent e-mail saying that she was not at all comfortable with the arrangement, because it seemed to violate the Anticybersquatting Consumer Protection Act of 1999.
"I heard nothing. Then someone called me on the phone, acting as though the company hadn't gotten my e-mail and telling me that my offer was about to expire. I told her about my reservations, and I felt they were taking advantage of a nonprofit. Her response was that the company was the broker, not the owner. When I told her it sounded illegal, she said the owners were using the site by redirecting visitors to a search page. It sounded as though she was reading from a script."
...But it's paid anyway
"By that point I knew off the bat it was not worth our money to pursue legal action to assert our right to the domain. Our options were really limited. Our thought is not "Is there another company with our name out there?"--we know there isn't--I was concerned that they would pull the offer and not sell it to us."
So our nonprofit friend got sucked into paying over the odds for a domain. She filled out the credit card number and all the registrant information required for domain records and sent it to BuyDomains. The deed was done. But the domain still had BuyDomains' parent company as registrar. And in this case, the domain registration had only another few months to run before expiring. And BuyDomains was trying to up-sell her to a hosting deal.
"The people I spoke to were very nice. They were not putting me under heavy pressure, but I didn't want to deal with them anymore."
So Carole was still working through the final details of transferring the domain to her own favorite registrar and trying to host it elsewhere. Two weeks after cutting the deal, the domain's still registered with BuyDomains and kicking up its own site pages when you enter the charitable group's domain name in a browser. And that's after paying several hundred dollars for a domain with only a few months to run.
Cases like this make me feel like shaking up the domain resale business. I'm all for turning an honest buck or thousand, but targeting nonprofits just doesn't seem right.
Cases like this make me feel like shaking up the domain resale business. I'm all for turning an honest buck or thousand, but targeting nonprofits just doesn't seem right. I don't think that adding new laws to the statute book or bringing in big dogs such as ICANN or the government will help this situation. Too many laws seldom do. But ethical business practices do. Sleazy scalpers aren't about to change their ways, so it's up to the domain resale brokers. If the BuyDomains, Pool.coms, SnapNames, and ClubDrops of the world insisted that their clients give fair breaks to registered 501(c)3 nonprofits (or flat-out refuse to deal with dot-org domain scalpers), the few really sleazy scalpers who use their brokerage services will lose interest.
Yeah, I know this is starting to sound a little utopian, but hey, 'tis the season for goodwill, isn't it? In the meantime, anybody care to join me in a boycott of dot-org scalpers?
Has Matt Lake been sucked into softheadedness by the season of goodwill? Does he need to stuff his opinion of dot-org scalpers into his holiday bird? Let him have it in TalkBack.