WASHINGTON, June 27 /PRNewswire/ --

- ICANN Solution to Domain Tasting is a Half Measure that Will do Little 
To Eliminate Tasting or Offer Protections to Internet Users

The Coalition Against Domain Name Abuse (CADNA), a coalition comprised of
11 globally recognized brand-name companies, would like to recognize ICANN's
solution to the problem of "tasting" as a partial success.

(Logo: http://www.newscom.com/cgi-bin/prnh/20070724/DCTU006LOGO )

ICANN recently put forth a proposal to address tasting due in large part
to CADNA's championing of this issue and because of objective research and
analysis of the proposed solutions conducted by the coalition. Unfortunately,
it is unlikely that the proposed solution will adequately address domain name
tasting.

Domain name "tasting" is the process by which registrants obtain a domain
name and track its traffic over the course of the five-day Add Grace Period
(AGP). If it does not yield enough traffic to make it immediately profitable,
the registrant drops the domain name within five days in order to get a
refund of the 20-cent registration fee.

In January, the ICANN board approved a measure to make the 20-cent
registration fee non-refundable. In June, ICANN voted on a further measure
that would only allow registrars refunds up to 10 percent of net new
registrations or fifty domain names, whichever is greater. The combined
impact is that registrars will only be accountable for the non-refundable 20
cents on deletes beyond the 10 percent threshold.

Since 2006, CADNA has been the galvanizing voice on the issue of tasting.
CADNA has worked tirelessly to raise awareness about tasting as the newest
form of domain name monetization and has rallied support among businesses,
lawmakers, and members of the media to pressure ICANN into taking more
immediate action.

According to VeriSign's June 2007 Domain Industry Brief, US$1.46 was the
average amount paid per advertising click for the first quarter of 2007.
Domain name speculators that place sponsored ads on their Web sites typically
earn half of this amount per click.

CADNA's 2007 drop-catching study uncovered that 6.6 percent of dot-COM
domains were registered immediately after post-expiration deletion and kept
throughout the timeframe of the study. In other words, 6.6 percent of names
were quickly deemed worthy of registration and development. By the end of the
study, the percentage of names that were ultimately kept climbed to 25
percent, but that took sifting into account as some names were kited - the
practice of repeatedly tasting a domain. The 6.6 percent of the sample is the
subset of names that immediately proved their value.

According to the results of the CADNA study, a registrant that registers
100,000 domain names would keep 6,600 of them on average. At US$6.20 each, 
the cost of these domain names would be US$40,920. Paired with the 20-cent 
ICANN fee for each of the 93,400 domains that were not kept, the total cost 
of the domains would be US$59,600. In other words, the taster would have 
spent US$9 per profitable domain name that was identified via tasting and 
kept beyond the Add Grace Period (AGP).

The 20 cents that the registrant wasted on the names that were not worth
keeping would be easily covered by the ample profit from the good names they
identified through tasting. The additional new cost per domain name would be
US$2.80. Since each click is worth 73 cents on average to a 
"traffic-squatter," each domain name would need to receive just an additional 
3.8 clicks in year one in order to make up the difference from the 
"inconvenient" ICANN fee.

Before the proposed ICANN tariff on all added domains, a name needed to
demonstrate that it could deliver 8.5 clicks/year (.02 clicks/day). With the
ICANN fee, a name needs to demonstrate that it can deliver 12.3 clicks/year
(.03 clicks/day) in year one. With so few paid-search ad clicks needed to
break even either before or after ICANN's 20-cent solution, the effect of the
non-refundable fee is negligible from the domain taster's perspective.

While it might become unprofitable for registrants to kite domains and
constantly pay registration "add fees," tasting domains can remain a
relatively risk-free and low-cost practice. Unfortunately, it is therefore
unlikely that ICANN's new registration fee policy will completely eliminate
the problem of domain tasting.

ICANN has been only partially successful in responding to the threat of
domain name tasting because of pressure exerted by CADNA and other
organizations that have stepped up to answer CADNA's call to action.
Unfortunately, the ICANN process continues to be highly influenced by the
needs of groups that profit from domain registration and related activities
rather than by the needs of the user community. As a result, it is difficult
to achieve much needed policy reform.

The Coalition Against Domain Name Abuse (CADNA) is a 501(c)(6) non-profit
organization dedicated to ending the systemic domain name abuses that plague
the Internet today. Its members include the following global corporations:
American International Group, Inc.; Bacardi & Company Limited; Compagnie
Financiere Richemont SA; Dell Inc.; DIRECTV, Inc.; Eli Lilly and Company;
Hilton Hotels Corporation; HSBC Holdings plc; Marriott International, Inc.;
Verizon Communications Inc.; and Wyndham Worldwide Corporation. For more
information, please visit www.cadna.org.

Contact: Yvette Wojciechowski
             press@cadna.org
             +1-202-223-5232

Web site: http://www.cadna.org