NSI's New Domain Search 'Reserve' Policy Continues to Evolve

NSI's so-called Reserve Policy adapts to market pressure and threatened legal challenge.

After 5 days of controversy, sniping, public relations statements and damage control, Network Solutions (NSI) has attempted to address the growing firestorm over allegations of Domain Name Front Running (DNFR). To be sure, there will still be debate about whether NSI was ever really motivated to protect consumers by reserving searched domains for 4 of the 5 day grace period.  Certainly, NSI was also protecting itself against the prospect that consumers would use their domain availability search service and then register available domains with less expense registrar (no doubt a common occurrence).  

NSI May Be Legally Liable For Alleged Front Running

Ari Goldberger over at the Direct Navigation Blog picked up on a story on DomainState.com and on DomainNameNews.com that once again suggests that people searching for domain availability at certain registrars are being registered by the registrar.  The registrar thereby prevents a registrant from purchasing it at any other registrar other than the Registrar whose web site was used to check domain availability. This, from our point of view, amounts to fraud and domain theft at the registrar level and has earned the term domain "Front Running" a term picked up from illegal stock broker practices using the same model. Domain Name Front Running (DNFR) is believed to be caused when registrars or ISPs sell domain availability search traffic that runs through their network to front runners, who register the domain before the consumer is able to complete registration.  The DNFR then tries to sell the domain to the original availability searcher, or to another third party. 

Frank Schilling posted an excellent article on the history of domain tasting, a related practice, titled The Closing Window: A Historical Analysis of Domain Tasting which is an excellent overview of these types of problems and how they occur.

Network Solutions (NSI) has now been accused of front running domains, a shocking accusation given NSI's domain industry leader status.

No one has challenged domain Front Running by registrars in the courts, likely because the practice is new and since the loss of a single domain would  not typically generate a level of damages to support litigation. But litigation over this fraudulent domain practice by registrars is both viable and likely inevitable as noted below. While NSI's explanation -- below -- may be legitimate, there is little doubt that some registrars are engaging in front running practices.