Domain names: more extensions for increased cybersquatting

Domain names are deeply rooted in our cyberculture. Companies have used them for a long time, often to display their trademarks and settle their digital identity. This is the reason why they should be aware of cybersquatting threats, and define new strategies to prevent it. Especially when the number of new gTLDs is exploding…

domain names cybersquatting

Source: http://tweakyourbiz.com/technology/files/An-Expensive-Lesson-In-Domain-Names.jpg

When it comes to using the internet, domain names cannot be avoided. Indeed, one uses it conscientiously or unconscientiously when browsing or redirecting a website.
The URL used is, in the vast majority of the cases, composed of words separated by dots and followed by an extension (.com, .uk, .fr, …).

This system is not obvious. Before the early 80’s, computers and servers were referred to by their IP addresses, only composed of numbers (for example : 81.57.9.91). This system was not the most user-friendly and appropriate, as it was difficult for the user to remind this particular number combination.

In order to allow a better user experience, the domain name system (DNS) was created to use common words and signs instead of the IP address of the computer. The principle is simple: a network of servers hosts a registry of domain names and their corresponding IP addresses. Each time a user sends a request mentioning a domain name, the server looks after the corresponding IP address in its registry, and redirects the user’s request to its destination.

The procedure to register a domain name is quite complex because it has to fulfill many technical requirements, and respect the hierarchical structure of the DNS.
Furthermore, the candidate can contract with a host to cover the technical aspects of the domain name delegation.

Once the domain name is attributed to its owner by the registry, one must be aware that there is always a risk of unauthorized and damageable copy by fraudsters or interested persons.

Indeed, a domain name is a valuable asset for a company. It is part of its identity and often contains its name and trademarks.
Being aware of it, some third parties try to profit from it by registering very similar domain names, or registering on purpose domain names that contains the trademarks before their owners do, in order to sell it back to them afterwards for a very high price. In some cases, this practice known as « cybersquatting » may even involve blackmail processes.

These practices are damageable for the reason that a company’s website is partly referenced by search engines and identified by users thanks to its domain name.

There are, however, some ways to prevent cybersquatting, using intellectual property law as well as commercial and civil responsibility. But the outcome might be uncertain, especially if the cybersquatter is located in a distant country.

Some extra-judicial procedures are proposed by ICANN (the top hierarchical authority of the DNS), local registries and even the World Intellectual Property Organization (WIPO).
Cheaper and faster, they usually consist in the intervention of a mediator or an arbitrator.

The two main procedures are the Uniform Domain name dispute Resolution Policy (UDRP) and the Uniform Rapid Suspension (URS). The first one may lead to the transfer of a squatted domain name while the other may lead to its suspension.

But are these procedures effective enough to prevent and remediate cybersquatting practices ?
About two years ago, ICANN greatly extended the possibilities concerning the registration of domain names.
Until 2013, only 24 generic top level domain extensions -gTLDs- (.com, .net, .org…) were allowed.

Since 2013, this number rose up to 613. It is to increase progressively, as ICANN made possible for companies to register domain names using their own brands as extensions. The total number of generic top level domain extensions is to rise up to 1400 in the years to come.

Such an impressive augmentation can be explained by the fact that the DNS registries were becoming saturated, as almost all the domain name combinations had been registered.
But it also has important consequences regarding cybersquatting prevention.

The explosion of possibilities allowed by the multiplication of new gTLDs induces new opportunities for cybersquatters and a greater risk for companies.
This new situation supposes a proportional investment from the trademark owners in order to maintain the effectiveness of their cybersquatting watch plan, and it doesn’t even include the litigation resolution fees.
Indeed, even if the URS and UDRP are cheaper and faster than regular judicial procedures, they aren’t free and require legal counsel from lawyers and other legal professionals.

The prevention of cybersquatting cannot consist anymore in the registration of all potentially damageable domain names, because new gTLDs have exponentially increased the possible combinations.

As a consequence, all cybersquatting threats can’t be dealt with by trademark owners. They have to make choices and define new strategies in order to concentrate their efforts on the protection of a restricted number of domain names that best define their digital identity.

 

Nicolas Babelon
Étudiant du Master 2 Droit et Gestion de l’économie numérique de l’Université de Strasbourg, je tâche de prendre la mesure d’un monde transformé par la grande révolution technologique que sont les TIC. Nouvelles techniques, nouveaux modèles économiques, nouveaux enjeux politiques et stratégiques, le numérique est en passe de devenir la locomotive à laquelle s’accrocheront les wagons de notre société contemporaine…
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