CADNA Releases Study on Domain Name Drop-Catching

WASHINGTON, January 30 /PRNewswire/ --

- How Insiders Leverage the AGP to Avert Domain Name Investment Risks

The Coalition Against Domain Name Abuse (CADNA) is announcing the release
of a study on drop-catching. Drop-catching is an enabler for other domain
abuses such as tasting, kiting and typosquatting. Large registrars and others
that have the means to test domains on a large scale have harnessed this
technique and built a business around taking advantage of ICANN's Add Drop
Grace Period (AGP).

This study provides quantitative data on drop-catching and domain name
registration trends and as a result can be used to gain insight into the
world of Web traffic monetization. Armed with this knowledge, brand owners
can better understand how cybersquatters operate and can avoid being targeted
in the future.

Drop-catching refers to the process whereby a domain that has expired is
released into the pool of available names and is instantly re-registered by
another party. Typically the new registrant has no knowledge of the existing
"traffic value" of the name.

CADNA's study, which tracked 17,000 randomly selected Dot-ORG, Dot-COM
and Dot-NET domain names after their scheduled expiration on September 18th,
2007, found that 100% of the Dot-COM and Dot-NET domains were instantly
registered after they were released. 39.8% of Dot-COMs and 32.2% of Dot-NETs
were added and dropped again throughout the study via a practice known as
kiting. The initial registration of all deleting domains and the subsequent
domain tasting and kiting that occurred points to a willingness on the part
of drop-catchers to continuously register domain names since they can be
tested and easily returned with no monetary penalty.

The results also show that 87% of Dot-COM drop catchers use the domain
names for pay-per-click (PPC) sites. They have no interest in these domain
names other than leveraging them to post PPC ads and turn a profit.
Interestingly, only 67% of Dot-ORG drop catchers use the domains they catch
to post these sites most likely because Dot-ORG names are harder to monetize
due to the lack of type-in traffic and because they tend to be used for more
legitimate purposes.

The results of this study also show that the majority Dot-COM and Dot-NET
domains were registered by a limited number of registrars, namely Enom,
Domain Doorman, Capitol Domains and Belgium Domains. The practice of
drop-catching, which is aided by abuse of the AGP, has created a landscape
that significantly harms the integrity of the Internet.

Whether employed by a few select parties or used more broadly, this
behavior limits consumer choice, preys on consumers through criminal schemes
to defraud them and negatively impacts the experiences of all Internet users.

CADNA calls upon ICANN and legislative bodies to take decisive action to
curb these abuses.

To view the Drop-Catching report, which was prepared by research-based
Internet Strategy Consulting Firm FairWinds Partners on behalf of CADNA,
visit http://www.cadna.org/en/pdf/cadna-white-paper-drop-catching.pdf