Definitions first: lawyer Kelly M. Slavitt, in her Protecting Your Intellectual Property from Domain Name Typosquatters article, wrote:
Cybersquatters register domain names based on a company’s trademarks and then attempt to extort payment from the actual trademark owner in exchange for returning use of the domain name…
Typosquatters are a variation on cybersquatters, but the motive of both is the same: to profit by trading off of the goodwill of intellectual property assets established by rightful owners.
Typosquatters register intentionally misspelled domain name variations of the actual company’s trademark. The typosquatter profits by directing traffic away from the actual Web site to the typosquatter’s rogue site.
Affiliate program manages and online advertisers in general are overwhelmingly against the use of trademarked names in affiliate/publisher’s domains. The same stance is being taken against typosquatters as well.
Now, let’s take this one step further, and look at company (an affiliate/publisher with some of the major European and U.S. affiliate networks) that cashes in on mistyped domains in a different way. I am referring to Barefruit:
Barefruit has partnered with major Internet service providers and portals to develop a system whereby mistyped domain names do not land nowhere, but the end user sees a page with sponsored listings instead. The revenue (which frequently stems from an affiliate marketing relationship) is thereafter split between Barefruit and its partners.
Isn’t this just another form of affiliate marketing parasitism as my friend Donk has pointed out here? It certainly does look like one to me.
Wikipedia’s article on Barefruit quotes some interesting statistics:
Network Solutions has indicated in the past error traffic makes up up to 20% of total network traffic and of that NXD (i.e. Non Existent Domain) errors make up as much as 15% in addition Google recently indicated that 404 http errors alone account for 6.96% of published pages on average of the 11.5 billion web pages currently on the web. These huge volumes has stimulated significant interest in monetising this “lost” traffic.
The fact that there is a market for it, does not mean that it’s okay. There are huge markets for trademark bidding, downloadable toolbars, comprehensive coupon aggregation (even at the expense of theft of exclusive affiliate-specific coupons), etc. But this neither makes these practices ethical, nor valuable for the industry. The essence of Barefruit’s approach is really no different from that of a typosquatter.
Obviously, there is another take on all of this, as nearly every major UK-based affiliate network works with Barefruit. Am I missing something (apart from the financial component, of course)?
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Geno,
You could take that one step further, since many of the ISPs are already doing this. Also the toolbars are playing in the space as well.
Now we also have the “official typosquatter” citizenhawk, who will contract with companies to work on getting these domains back and taking commissions on the traffic. In my opinion this only serves to legitimize the “business model” of redirecting typo traffic through affiliate links.
I’m actually amazed at how many affiliates (and sometimes networks) thinks this is ok. If you have a registered trademark and someone is monetizing off of a typo of your domain and selling it back to you – aren’t they are committing a trademark violation?
I personally am filing one of these when necessary http://www.icann.org/en/udrp/udrp-policy-24oct99.htm
“If you have a registered trademark and someone is monetizing off of a typo of your domain and selling it back to you – aren’t they are committing a trademark violation?” — Exactly my thinking, Bella!
I have to disagree. Although I don’t do this myself, the brand had the opportunity to register the domain name(s) themselves, and they didn’t. So a smart affiliate registered the names, and is charging a fee (the commissions paid) to help the users find what they’re looking for.
To me it’s one of those gray areas that is more black than white.