DomainTools Blog

Microsoft, Google and Yahoo have agreed to pay a combined fine of $31.5 million for accepting ads for online gambling. They have all stopped accepting this type of advertising a few years ago but the fines are finally getting settled. It is a crime in the United States to allow gambling online or to enable gambling ads on US websites. This reminds me or prohibition from the 1920s when alcohol was made illegal for 13 years. The 18th amendment made it illegal and the 21st amendment repealed it. During those years “drinking has generally increased; the speakeasy has replaced the saloon; a vast army of lawbreakers has appeared; many of our best citizens have openly ignored Prohibition; respect for the law has been greatly lessened; and crime has increased to a level never seen before.” The only way to control something is to make it legal so that there are structured laws around it. Blanketly making something illegal means that there are no laws around the edges to keep people safe that engage in the activity. It is far better to make laws and govern something then to ignore that it exists.

Anyone can gamble in Las Vegas, Atlantic City, and on Indian Reservations. So clearly the difference between offline and online is not what makes something illegal, so then why is our country being hypocritical about gambling not being allowed online?

As a poker player, I personally think this prohibtion is wrong. From my domainer perspective, I also think this is wrong. I hope these 13 years of prohibition pass fast. I know they will pass eventually and when they do the gambling domains will be worth a lot more!!!! We all trade these domains from a lot less because revenue is hard to come by on them. Those domainers that control these forbidden domains will be worth considerably more when they come back in favor.

With all the publicity on cybersquating and Microsoft trademarks. One would think only a moron would register a trademark of Microsoft. I think I found the biggest moron alive. He went out and registered every spelling error he could find of Microsoft. Talk about wanting to be hit by lightning. Kerry can I introduce you to Aaron Kornblum.

I think there is an endless supply of want-a-be domainers that just turn out to be Cybersquatters. My best advise to a new domainers is stay away from other people’s trademarks. If you have heard of a company or a product the best advice is to NOT register it. Find generic domains. Register local domains. I live in Seattle, so SeattleHousing.com or SeattleMenus.com are good domains to register. A lot of the good generic domains are taken but there are still a lot out there. Find them.

Microsoft fired off the first three lawsuits out of a total of 22 lawsuits that will be filed this month over domain names. The other four companies filing the remaining 19 lawsuits will be Yahoo, Dell, Time Warner, and Wal-Mart. The five powerful Internet companies seem to be on a mission to send a big warning shot across the bow of future cybersquaters. They want to send a loud message, “stay off our trademarks”.

All five companies are members of the International Trademark Association (INTA) so on the INTA website they discuss the lawsuits. The INTA sites says, “This alarming trend affects everyone who uses the Internet, including children who may be misdirected to adult-only sites when they innocently mistype a brand name into their browsers.

Once misdirected through such deceptive practices, consumers can be bombarded with advertisements, pornographic material, unlawful spyware and even harmful computer viruses.”

From what I can tell, the domains in the current lawsuits just serve ads. There is no unlawful spyware, virus, or pornographic material. I think this vilifying language is thrown in for a good spin. It would be great if INTA just laid the facts on the table rather then trying to vilify their opponents. There is no doubt in my mind that these lawsuits are justified but the extra banter seems distracting and paints INTA as a group that needs to throw mud while it is litigating people.

We have obtained a few domains from the Microsoft lawsuits:

Lawsuit 1:

• Access VB.com
• ActiveX.net
• Autos MSN.com
• Excel Course.com
• Get Hotmail.com
• Hotmail Passport.com
• Outlooking.com
• Visual Basic.com
• Windows XP Tips.com

I have noticed that most of the domains in the September 11th lawsuit #1 are already in Microsoft’s name and have Microsoft’s Name Servers. It is like Microsoft filed the lawsuit after they got the domains. In some cases it appears Microsoft had the domains months before the lawsuit was filed. I wonder what the back story is there.

Lawsuit 2:

• DirectX 10.com
• Excel Tutorial.com
• Free xBox Live.com
• Mech Warior.com
• Microsoft Antivirus.com
• MS Access Database.com
• MSN Dialup.com
• MSN Music.com
• MSN Personal.com
• Windows Medai Player.com
• Windows Updae.com

It appears Frank Schilling, one the cleanest Domainers in the industry actually owned ExcelTutorial.com back in February. He must have got a C&D letter on the domain or did some house cleaning because the domain was set to expire in 2009 and he deleted it early. After Frank deleted it, Digi Real Estate picked it up. Then Digi sold the domain to Bogdan Kisielewski of Poland. That domain seems like a hot potato. But perhaps there is a service there. If Frank deletes it, don’t register it.

Lawsuit 3:

• Microsoft Excel 2007.com
• Microsoft Outlook 2007.com
• Microsoft Powerpoint 2007.com
• Microsoft Word2007.com
• MS Excel 2007.com
• MS Outlook 2007.com

Case 3 is more of a newbie mistake. Some new domainer thought he would strike it rich, Kevin Cody systematically registered the most clear examples of trademark domains. He was such a novice that he even registered the .biz extensions. If Kevin was looking for traffic he would have only registered the DotComs. Kevin was just squatting, the domains are parked for free at GoDaddy and GoDaddy is making all the revenue on the domains. Kevin registered 50+ domains at $8 each. For a total of $400 in fees. Now he faces $50,000,000 in damages. I bet Kevin gives up domaining now. I don’t think it is his cup of tea. First rule of domaining, learn the difference between domaining and cybersquating.

This is only a portion of the domains from each lawsuit. There are about 50-200 domains per lawsuit. Microsoft is suing for damages under the Anticybersquatting Consumer Protection Act which could be anywhere from $1000 per name to $100,000 in damages. The law is still very unclear where in the middle the damages should be. Industry lawyers like David Steele that have filed cases like this in the past have suggested that there should be a formula to figure out the penalty. Something like triple damages rather then a vague number. It would be easier to fight cases. In any event it is clear that domainers should not play with the dark side of being a cybersquatter. You never know when a corporation will grow teeth and bite back hard.

I remember my first employer in College (circa 1996) ran a site called Windows95.com, that site was sold to CNET for $20 Million. It was later rebranded WinFiles.com after the Anticybersquatting act was passed. Back then the rules were not so clear. The site had a huge following and led to successful spin off companies like VServers.com that sold for more then $60 Million. VServers was built on the traffic of Windows95.com. Every page promoted that hosting company. In today’s market the current laws would easily say something like that would be illegal but back then the rules were not so well defined.

Most of the names from the lawsuits are clearly obvious trademark infringement. But a few domains look innocent. Had a random person owned Outlooking.com without owning other Microsoft Trademark domains then it would be a hard case for Microsoft to bring the owner to court.

I think Microsoft is sending a clear signal to the domaining community. Don’t go to the dark side. Stay away. Companies like Microsoft sue all the time. These types of lawsuits help educate the public on what types of domains are not ok to register.

Microsoft doesn’t seem to understand how to manage their own domain names. They have chosen to delete MSN Hotmail.com. They could have simply renewed the domain for $10 and that would have been the end of the story. Most large companies have several misspellings of their domain names or variations on it, but this is a generic combination of two words MSN + Hotmail. They even brand it as such on their login page - see the screenshot above. Large companies should always renew these type of domain names because they get a lot of traffic and they would not want other people to own them. Plus, they have branded it and driven all this traffic to it. Hotmail customers will be very confused next week when they see ads for other web email companies instead of a login page. Compete.com says that the domain gets 29,854 U.S. visitors per month, but we are sure that the number of visitors is far higher (compete’s numbers tend to be a bit low). Either way, this name should have been renewed.

The domain is currently in pending-delete status, so we know it will delete for sure. There is no way to get the domain back out of this status - the registry has a 30 day redemption status but Microsoft slept right through it. Whomever manages Microsoft’s domains should get a swift kick in the bum from top management. Once it does drop, many people will back order it.  The highest bidder will win it, and they will confuse Microsoft customers. Microsoft is appearently clueless, so they will not even bid, but eventual they will find out that someone else owns their domain name and then they will spend a few thousand dollars to recover it. All this because someone at Microsoft thought they didn’t need it.  After all, they own MSN.com and Hotmail.com, so why would they need MSNHotmail.com.