Posted November 27, 2012 by Jake Emen in Technology

Domain Grab By Donuts

Avauncer.com - The world wide web looks like an endless phenomenon. Something will not get away if it gets into the internet. But in reality it behaves just like a very crowded real estate market where the website domain names are the properties or products from the merchants. They sell them in higher bid prices in order to pocket as much profit they can from the deal, forgetting the ethics and the fairway.

That’s why the auction taking place in mid 2013 for 1400 new suffixes of .Com is a big deal. This domain name attracts the interest of Google Inc. (NASDAQ:GOOG), Amazon.com Inc. (NASDAQ:AMZN) as well as Donut a new company trying to grab the major crowd of internet and trade them for higher profit.

In 2010 Clover Holdings based in the Caribbean islands of St. Vincent purchased the rights to sex.com for a price of $16 million, Amazon.com Inc. (NASDAQ:AMZN) has gone for the suffix .Book while Google Inc. (NASDAQ:GOOG) intends to .Ads, .Buys and .Google etc. The introduction of suffixes attracted all companies.

1400 new suffixes have been released by a US body named Internet Corporation for Assigned Names and Numbers (ICANN), which is a nonprofit corporation involved in the registration of new domain sites. It coordinates the internet addressing system and ICANN is charging about $185,000 for each application.

The cut throat competition is on.

As far as it’s about the licensing of websites at a higher premium its ok. But now some unhealthy practices have started calling cyber squatting. It’s a crime in the eyes of US trademark law as in this company intend to buy domain either to block a competitor from using it or to create look alike websites to deceive the intent user and to stall the cyber competition.

Donut spent $56 million for 307 new suffixes which is far more than Google’s application of 99 suffixes and Amazon’s 76 suffixes. It wants to incorporate its own central clearing house for licensing to businesses. More than $100 million in venture capital is with Donut who bid for .Mortgage and .Dentist now.

ICANN has been warned by Mcarter & English lawyers that some of the Donut’s customers may be involved in cyber squatting and if it continues for long they censor can lead ICANN to bar a company from operating domains.

Donut’s planned to sell Demand Media, Inc. (NYSE:DMD) 107 of its top domain names, but ICANN established eligibility guidelines making Donut ineligible to participate in the bidding process.

According to Demand Media, Inc. (NYSE:DMD) Executive vice president Dave Panos his company has no equity relationship with Donut as in addition to its hopeful purchase of 107 domains from Donut; dozens of ICANN’S names have also been applied by Demand Media, Inc. (NYSE: DMD).

Shares of Google Inc. (NASDAQ:GOOG) closed today at $661.15 on NASDAQ GS, Amazon.com Inc. (NASDAQ:AMZN) gained 1.56% to close the day at $243.62 on NASDAQ GS and the share price of Demand Media, Inc. (NYSE:DMD) is at $8.51 USD up by 0.83% on the NYSE. 

Jake Emen

Jake Emen is a writer residing in Houston, Texas. He has written numerous articles, some for the Washington Post, USA Today, the LA Times, and the Houston Chronicle. One of AC s Top 100 Content Producers, Carly Hart s interests include news, politics, parenting, frugal living and consumer related issues. He acted as a customer advocate and has extensive experience working on Wall Street. As a highly acclaimed industry leader, he has been a catalyst for public education and accessability of financial services.