I was referred by this CF-Talk thread to an interesting article on domain kiting by Bob Parsons, the founder of goDaddy.com. The basic premise is the same as that of kiting a check - with the exception that domain kiters don't ever cover the cost. You probably are already aware of the term domain kiting, but in case you are not aware, here's a rundown.
- A domain kiter will set up shop by placing a large deposit at a registry (like verisign).
- The kiter will then register as many domains as it can afford based on the deposit. These domains are based on misspellings of common domains, company names, trademarks, catch phrases and the like.
- The kiter will use the domain to put up farms of link pages that drive ad-revenue.
- Since the registries allow a 5 day grace period to cancel the domain without penalty, the vast majority are canceled with no money charged.
- The domain can be immediately re-registered with no penalty in most cases. Amazingly, the registries allow this practice.
You can see that even modest success by the kiter could make it profitable.
According to Mr. Parson's, of the 35 million
domains registered in May, 32 million of them were part of this kiting strategy. Amazingly, although the largest registries (like Verisign) could stop it if they wished to do so, they choose to ignore the problem. I-CANN could probably stop it as well, but they move so painfully slow that they make congress look like Ricky Bobby. One other thing that occured to me is that search engines could lend a hand in this case. Google, for example, could simply refuse to index any site that is still within the 5 day period. The link pages would lose value if no one could find them - although it wouldn't solve the problem with people who are fat-fingered or lesdyxic.
This is why the internet reminds me of Star Wars. It's like an all powerful force with a dark side and a light side - with me as a part of a small rebel force....