Friday, February 01, 2008

Domain names get traded as if they were "money"

Brad Stone has an important story about domain names with trademark law implications in the Business Section of today's (Friday Feb. 1, 2008) The New York Times, p C1, "Coins in the New Realm: Trading in Domain Names Gains Investor Acceptance," link here. The story continues on p C9 as "Domain Name Trading Gains Respect."

The metaphor, of course, compares a domain name to fiat money, hardly an adequate model. Sometimes common word domain names may be important for the political influence that they may have than for generating revenue.

The article discusses trademark infringement lawsuits against small domain registrars and "domainers" for creating parked domains with names that are similar to those of famous marks. Often McAfee Site Advisor catches this practice and flags such sites as yellow. A related practice is "domain tasting" which ICANN and other industry players are trying to discourage.

The subject is a bit complicated. There are complaints that people make money without running a real business (but that sounds like house or condo flipping connected to the subprime crisis, doesn't it!), or even without developing any meaningful content. On the other hand, an individual may develop considerable political content and attract considerable attention by using a catchy name without trying to earn revenue, arguably taking opportunity away from investors who might use the name to create jobs.

Relevant, of course, is the Trademark Dilution Revision Act of 2006, passed in October 2006, as on this blog. Companies might be able to go after domainers under this act, if they have a reasonable case that future tarnishment would occur. However, the Act, as worded, still appears to offer a defense for non-commercial (new-content-oriented) use.

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