Rise of Internet spawns new grey market

for site names bought then resold for a profit June 10 1997

Let's assume that like many readers, I've got a business. For purposes of this column, we'll call it My Biz. And let's further assume that like many readers, I want to get my business onto the Internet, ideally with a well-thought-out plan, perhaps to post a sales catalogue, or perhaps just a glorified ad.

I could make arrangements with my Internet Service Provider to host my Web site on its server, but now it's decision time. I could simply let my Web address reflect that fact, forcing users to type in something like www.myserviceprovider. com\mybiz\index.htm. But it would be much nicer if users just had to remember my company's name, and type something like, and bingo-bango, my logo is in their face.

For that to happen, I'd have to register my company name as an Internet domain. That gets it a real Internet Protocol (IP) address, something like You see, when you type in that semi-memorable www address, your service provider's Domain Name Server has to translate it into the valid 12-digit number that is the real address in order to try to make the connection.

To obtain that precious IP address and register my proposed domain name, currently I have to connect up with so-called InterNic, actually Network Solutions Inc., a Herndon, Virginia, company that holds the contract to act as registrar for the Internet Society. For a modest, US$50 fee, they will register the domain name, and ensure that it is distributed to Domain Name Servers worldwide, enabling all and sundry to find my site.

There are a couple of problems, however.

Recently, InterNic issued its millionth domain name (up from a mere 3,000 as recently as 1995.) While there are still lots of potential names remaining, there is a growing shortage. After all, I don't want just any name, I want my company's name! And names are organized into so-called domains (the couple of letters at the end of the name). While the current organization includes domains for countries (.ca for Canada, for example), and for a range of organization types (.edu for education, .gov for government, .org for nonprofit organization), the bulk of the registrations have been for the .com commercial domain. The Internet Society is supporting a plan to increase the number of domain names, but this may simply multiply the problem. I may find myself wanting to register in multiple domains: mybiz.firm, mybiz.web, instead of simply

The Internet Society's proposal may not even fly -- PSINet, which carries 15 per cent of the world's Internet traffic, has condemned the plan as a "backroom proposal," and is demanding a more open process. As well, several governments are reportedly watching closely.

Also, there is a lack of clarity about who should own particular domain names. While you may use a product or company name, that doesn't mean that you automatically have the ability to get that as your Internet domain name. I might find that has already been registered.

Initially, InterNic was simply issuing names to the first applicant. As a result, battles have been fought over names such as Avon and Banana Republic. Even Microsoft found someone had registered (that's with a 'zero') while a 24-year-old student set up a popular Web site called After widespread complaints and publicity, InterNic has declared that trademark holders have first priority on those names. This is not a complete solution, however; for example, trademarks are protected nationally, while Internet names are international in nature. Can InterNic possibly search for trademarks worldwide? What if I own My Biz in Canada, but someone else uses the name in Australia?

In addition, there is a growing grey market for domain names, as individuals continue to register non-trademarked, but potentially usable names, then offer them for sale to wannabe users., for example, acts as a broker for people wanting to buy or sell domain names, even offering a public bulletin board for would-be name vendors.

Recently, a group of Vancouver publications (including this one), hoping to put together a common site, tried to register Their application via a local service provider was delayed. In the interim, someone else registered the name. Luckily, the agreed-upon sale price was relatively modest.

Rumours abound of other grey-market sales as local companies found their desired easy-to-remember name already taken. According to Computer Paper publisher Doug Alder, the publication's masthead has been "raided" -- the names of contributors were registered without their knowledge or consent on the assumption that some of them would soon want their own Web sites, and would want to purchase the right to use their own names! It is a safe prediction that the chaos and complaints will continue.*

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Alan Zisman is a Vancouver educator, writer, and computer specialist. He can be reached at E-mail Alan