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Buying a Domain From a Cybersquatter
Nevo writes "A partner and I are in the planning stages of a business. We've decided on a name that we'd like to use but the domain name is already registered. The owner has a single 'search' page up (similar to the one at www.goggle.com)... clearly not a legitimate business interest, but since we don't own a trademark on this name it doesn't qualify as bad faith, I don't think. Does anyone have any experience buying domains from these operators? Do you have any advice on how to approach the owners of these domains to get them at a reasonable cost?"
Here's a quick warning: there's a lot of scamming in the domain marktplace. It's easy for scammers to get you to buy, then never transfer the domain.
1. Set your PayPal account to draw against a credit card, not your bank account. You have both your credit card's consumer protections as well as PayPal's this way, the difference being you can actually get someone on the phone at your credit card company. When they yank the money from PayPal, suddenly PayPal will care.
2. Use an escrow service. Buyer puts the money in, you transfer the domain, and then you get paid. Most scams happen when people do direct purchases. Lots of domainers use escrow.com. It works.
3. Make sure you are dealing with a legitimate business or a real person. A little due diligence goes a long way.
-- $G
First of all what you are describing is not cybersquating - it's no trademark, not a domain typo - there is no bad faith. The domain has been registered by a domainer - a domain trader that buys premium domains treating them as an investment.
When you type in the domain name you will see a domain parking page - a website filled with some adds in order to earn some money to finance the cost of domain renewal plus sometimes a few bucks extra. The domain is not indexed by google - it's a mutual agreement between large domain parkings and google - not in index, yet with google ads.
As the domain is not registered as a clear example of cybersquating (and so is not getting a lot of traffic) you can be pretty sure it's for sale - that's where we earn money.
The domain value is based on (in no particular order): .com is the most expensive
1. domain length - the shorter the more expensive.
2. tld -
3. the acctual domain name - if it is just a bunch of unpronaucable letters it will be cheap, if it's a word it will cost ya, especially if it means something. some random examples ghdn.com < geen.com < geek.com
If you want to buy the domain make an offer, but a fair one or you will be added to ignore list after the first message. We get loads of offers which are too low by two-three orders of magnitude and reading all off them is not really an option.
Once you agree on the price do use one of the domain markets that offers escrow - sorry I can't really point you to a speciffic site, as I deal exlusively in eastern european tlds and we have some local markets.
It doesn't matter if it's bad faith or not, ICANN wants the domain to have a useful purpose. That's why people put the "search engines" up. However, the likelyhood of them showing up to defend their useful purpose is slim to none. The problem you have is that in order to file with ICANN for ownership of a domain, you need about $3000.
http://lmgtfy.com/?q=icann+domain+dispute&l=1
Last time I had to do it, it took about a month. This was last year. We filled out the paperwork, then our "dispute agency" (ICANN itself delegates to an agency) contacted us for MORE paperwork, then the other guy didn't reply because he had used an "anonymous registrar" so we won by default.
I appreciate the idealism here, but it isn't always so simple. We paid a squatter $3k for our domain when we really had better things to spend our money on; that was 5% of our start-up capital. We still regard it as the best investment we made. (Our original name was 25 characters and we got down to 7)
Just be sure to set up a backup domain name in case things fall through and to give yourself better bargaining position. I think he wanted $6k for it.
Another word to the wise-- don't make a domain extortion be your first purchase for a start-up. Sort out more important things first like getting clients. If your web presence is all you have going, things get harder.
Resisting urge to curse
I've owned a domain name in .org that is my cat's name. It's been a personal domain since then. Someone registered the .net variant of it and then trademarked the name. The .com variant was parked for years by a third party. I did a backorder on the .com and got it, and registered it.
About a year later the guy with the .net started to threaten me because he got a trademark on the name and wanted both the .org and .com. I offered to turn over the .com at no profit to myself because I didn't really need it nor was using it, but then he starts to insist I also turn over the .org variant as well.
I stood my ground and threatened to fight him as much as it took in court if necessary and sent him numerous cases where trademark doesn't mean ownership of the corresponding domain, especially if that domain is in active use and was around before the trademark.
He eventually dropped his demand for the .org.
And to think I just let him have the .com at my cost as well. I should have just let it get snapped up by a squatter and he'd have spent thousands for it.
Well, diamonds aren't really scarce. People horde them to make it seem as if they are.
Use the Microsoft approach (see MikeRoweSoft.com). Make a large offer for the domain. Once they accept, withdraw the offer and forward the paperwork to ICANN. The agreement to sell can then be used as evidence in arbitration and the anti-cybersquatting rules mean that they can have the domain taken away from them.
I am TheRaven on Soylent News
Let's suppose land is very cheap. There are a lot of valid businesses and families who would like to build offices and houses. Unfortunately, somebody with no interest in the land at all got there first, bought all the land, and is now selling it for a ten thousand times as much as he paid.
Sure, it's legal. Perhaps it's even a valid business. But he's still a scumbag because he's doing nothing productive other than costing people money who actually want to do something productive.
A while back Madonna sezied madonna.com, which was used as a legitimate adult site,
Actually, while it had been used as an adult site in the past, when Madonna sued for it the site was simply squatting the domain. From the WIPO Complaint:
But the most damning bit:
So IMHO, this guy was a squatter and deserved to have madonna.com taken away. It takes some brass balls to register wallstreetjournal.com :)
W..w..W - Willy Waterloo washes Warren Wiggins who is washing Waldo Woo.
My co-worker is simply someone who could use some extra money (trust me, he doesn't make that much).
He did so by making a little bit off of advertising with some in-expensive real-estate (a domain name). Sometimes the real-estate has value to someone else, and he can make a little extra.
He didn't get rich off of it, but he was able to have a little bit of spending cash, and didn't cost anybody else significant money.
That was really my point, that a lot of this is just normal people looking for a little bit of beer/electronics money.
As to the real-estate analogies below, this is simply a lot of billboard space being valued more by someone else.
Wow, sent an e-mail as suggested when clicking on "use classic" banner, and got a fast response that addressed my msg
Speculation of any sort should be frowned upon in our society. I'm all for capitalisim and making a profit, but buying something just so you can turn around and sell it to someone else for more money, without having made any improvements is just jackassery.
While "speculators" are the current MostEvilThing (tm); they provide a valuable service to an economy.
Consider firms that hedge commodities that they use - if they can't add certainty to their costs through hedges they are at the mercy of market swings. In order to hedge, someone needs to take an opposite position - both sides are speculating on future prices; to reap a potential benefit.
Speculation is not the problem; the failure to quantify risks and understand what you are actually buying is what causes problems.
People buy many things - stocks, land, art, coins - as investments they hope will increase in value. Just because they stick them in a box and wait does not mean they are being jackasses.
I'm a consultant - I convert gibberish into cash-flow.
sitting on a domain name unproductively with the intent to hope someone will come along and pay your ransom is not what most people consider legitimate business. while some URL's sell for high premiums because of the website behind it, or simply the value of the name itself (consider systemax's acquisitions of circuitcity and compusa URL, trademark, logo, etc.), this is not the case of many URL squatters who simply buy up every domain in sight, hoping one will make a payoff when a corporation takes interest.
If the owner hopes to invest in domain names, they should be expected to work the value of the name. but i disagree completely that a business hopeful with an actual use for a domain name should happily pay the extortion of a common domain thug.