Register.com Fends Off Criticism

Register.com Tuesday responded to published reports that its service has
become a haven to cybersquatters or domain speculators.

One of five organizations selected by the Internet Corp. for Assigned Names and Numbers to test a new shared registration system and
ultimately to compete with Network Solutions, Register.com claims that it already
handles more registrations than any other company, including Network
Solutions. According to Register.com, it has performed more than 600,000
domain registrations since its launch in January, 1998.

But The Los Angeles Times said Monday that a large percentage of
Register.com’s business appear to be from domain speculators. The Times
reported that the company recently registered nearly 75,000 domain names
for a computer club in London, but only a few were ever paid for.

The article also reported that “members of the Internet community”
including Internet Society president Don Heath were “troubled” that a
company that may be associated with cybersquatters was selected by ICANN to
participate in the shared registration system.

Register.com CEO Richard Forman said Tuesday the Times story contained
factual inaccuracies and may have been planted by one of his company’s
competitors. But Forman stopped short of denying that cybersquatters prefer
register.com, which doesn’t require a payment for handling registrations
outside of the $70 dollar InterNIC fee paid to Network Solutions.

“We don’t go out and look for people that warehouse domains,” said Forman,
“but do cybersquatters use our service, and are we their service of choice?
That’s where you’re getting into dangerous territory, because you have to
determine who else is a funnel for cybersquatting.”

Brian O’Shaughnessy, senior manager of corporate communications for Network
Solutions, said NSI’s records show that a higher percentage of
domains registered through register.com are never paid for and are released
for non-payment.

“It’s well known here that the numbers do run
far below other resellers. Although Register.com claims to be one of the
largest registrars of names, the numbers don’t reflect the reality,” O’Shaughnessy said.

Concerns about cybersquatting could be moot, Forman said, once his company
ties into the shared registration system sometime next month. He indicated
that register.com will begin requiring customers to pay for domains at the
time of registration. Such a policy could drastically thwart speculators,
who currently are able to hold domains as long as 4 months before making
payment to Network Solutions.

“The important thing is that the whole process is changing, so this issue
is going away,” Forman said.

But NSI’s O’Shaughnessy notes that there’s nothing in ICANN’s accredation
agreement
that forces
registrars to require pre-payment, and individual registrars will be free
to choose “depending on their business model.”

NSI has no plans to require registrants to pay up front, although the
company might consider that option in the future, according to O’Shaughnessy.
ICANN’s agreement with registrars specifies that they must abide by any
ICANN-adopted policy “prohibiting or restricting warehousing of or
speculation in domain names.” But to date, no such policy has been adopted.

Ellen Rony, author of The Domain Name Handbook, told InternetNews that the
precise criteria ICANN used to select registrars is unknown, because the
decisions were not made public ally. But in her opinion, “ICANN focused on
operational capabilities in selecting the testbed, not business practices.”

The ICANN board is meeting in Berlin Tuesday and Wednesday to discuss a number
of issues, including cybersquatting. A live webcast of some of the meetings is available from the ICANN Web site.

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