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Without typo-squatters, how far would Google fall?

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Internet Security Threat Report 2014

Domain Parkers

For the sake of argument, Edelman guesses that Google is making at least $2m each year from typo-squatting domains. According to his logic, domain parkers - outfits that only serve ads from their domains - only register sites that actually make money. Thanks to a loophole in ICANN's registration rules, you can "taste" a domain's traffic before you actually pay for it.

"We know [parkers] use tasting to predict which sites are going to be profitable," he says. "So, when a domain parker registers a site, we have a strong expectation that they're making money on that site."

Guessing that parkers are paying seven dollars a year for each domain, he figures they're making at least seven from Google. And if they're making seven, he says, Google's charging ten. "If Google is charging advertisers 10 dollars for 200,000 domains - an exceptionally conservative number - that would be $2m a year gross to Google. But that's a ridiculous estimate. 10 dollars is way too low, and 200,000 domains is way too low."

For its latest fiscal quarter, Google reported revenues of $5.54bn and profits of $1.35bn. But the company isn't about to admit how much of that comes from its "AdSense for Domains" program, which specifically enables parked domains - sites that do nothing but serve ads.

Google says it "takes trademark violations very seriously." When we asked about the Dell case back in February, Mountain View told us: "Our trademark policy specifically prohibits the use of trademarked terms. When we find or are made aware of trademark violations we take immediate action including removing ads from our system and sites from the AdSense network."

But Edleman - and that class action suit - argues that even if with such a policy in place, Google is violating the ACPA. The ACPA prevents 'use' of typo-squatting domains, he says, and Google is 'using' them. "Compared to other online scams, it's easier for a judge to get to the bottom of this problem, because Congress has acted. Congress has put in place a regulatory framework that said 'don't cybersquat on other people's trademarks.' We seek to hold Google to that framework."

The law firm defending Google did not respond to request for comment. And when we asked the company about the case, a spokesman said "We believe that these claims are entirely without basis, and we are vigorously defending ourselves."

But whether Google has run afoul of the law or not, it's certainly enabling outfits that do. Judging from Edelman's study, Google could end 80 per cent of all typo-squatting if it would simply ban domain parkers from AdSense.

But Google says that parked domains are wonderfully useful. "AdSense for domains allows domain name registrars and large domain name holders to provide valuable and relevant content on their parked pages," the company says. "Parked domain pages generally have no content; however, by adding targeted ads, we hope to help users find what they are looking for."

Surely, they also hope to make more money. "Google is very diligent about some kinds of scams, namely the ones that Google decides are against its corporate interest," Edelman says. "Then there are other kinds of scams that seem to offer a benefit to Google. They're scams against someone but not against Google. On this kind of scam, I'm seeing a pattern where Google is considerably slower to take the action I would hope to see.

"Google could do more [to stop typo-squatting] if they wanted to. But they profit from each and every click that's associated with these practices, so they have every incentive to look the other way." ®

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