Domain Tasting

Sounds like some sort of snack or something, doesn’t it? In fact, what it really refers to is when a company will register a domain name, but not truly want the name; at least not when they initially register it. Instead, they are sort of “testing the waters” on the name. Once they have it registered, they will do a market analysis to see if the name can truly work for their company. The Internet Corporation for Assigned Names and Numbers (ICANN) allows people and companies to register a domain name, and then they have what is known as the AGP (the Add Grace Period), a five-day time period within which they can change their mind about keeping the name. If it turns out that the name does not work for them, they can cancel it, and they do not owe any money.

Now, if this happens on a small scale, it is not a problem. However, some firms will register hundreds (if not thousands) of domain names, and then end up only making use of a handful of them; those that they deem as being viable domain names that hold good potential for making money. The ICANN has received numerous complaints about this practice over the last several years, and some changes to the system have been proposed. In reviewing their records, ICANN found that only two million domain names were actually purchased during April of 2006. Yet, the total number that had initially been registered over that month was around thirty-five million! And, this was not an isolated incident. Less than a year later, in February of 2007, GoDaddy.com reported four million domain names out of 55.1 million actually being registered. Over time, several hundred thousand of those were eventually abandoned.

In January of 2008, the first option was to end the exemption on the transaction costs for the five-day grace period. A year later, no decision had been made, and an alternative was suggested. Rather than just a blanket abolishment of the grace period, it has been proposed that the AGP not apply to any applicant who deletes more than ten percent of their proposed domain names or fifty domains, whichever is higher. Many people consider this a far fairer system; it allows a small firm or a person with a limited budget to try out a domain name, yet prevents large firms from merely scooping up a huge number of names and then not making use of them.

There’s also another practice that’s very similar to domain tasting, known as domain kiting. In this case, a firm will register a domain name and then delete it during the five-day grace period, and then register it again right away; thus they get another five-day grace period. By continuously doing this, a person or company can effectively get a domain name, and yet never paying for it. Domain kiting is illegal, and can result in real trouble for any firm attempting to do it.

In terms of the domain tasting, no official decision has been made by the governing board of the ICANN, but they continue to debate a solution. It remains to be seen as to what they may – or will – do.