Domain Tasting - Watch out or you could get bitten!
Twelve months ago domain tasting was a little known phenomenon, but it has been brought to prominence in the last 6 months by PIR, the non-profit-making body which manages the .org registry.
Domain tasting is the practice of registering lapsed and unused domain names, monitoring the traffic passing through the site and then assessing the domain name’s monetary value. The monetary value of these sites is often more than the cost of registration. Valuable domain names are kept; less valuable domains are surrendered at no cost within the 5-day grace period after registration. Companies are using sophisticated algorithms and automated techniques to cycle millions of domain names in this way.
Registration by the domain tasters is fast. One recent example was a domain name which lapsed on a Saturday, but which by Sunday evening had been registered by a domain taster.
Businesses must be aware of the negative impact on their business or reputation which may be caused by a third party acquiring lapsed domain names or domain names which are similar to their brands. One recent example is a Rape Counselling Centre site which was converted to a link into an adult web page subscription service.
Businesses must think very carefully about allowing domain name registrations to lapse. Many businesses do not know the value of the names they hold. Procedures should be put in place to diarise and monitor renewal dates. Whilst it is possible to go through dispute resolution to get domain names back, it is best to avoid this if possible. In this case prevention is definitely better than cure.