Aust domain name resellers brace for bloodbath

Tempers have reached fever pitch in the domain name game, with NetRegistry's CEO Larry Bloch describing marketing practices of certain competitors as "a deceptively misleading, sneaky, slimy attempt to mislead the public".

While the last straw for Bloch was a recent marketing campaign by competitor Internet Registrations Australia, he also shot criticisms at the bodies charged with regulating the industry.

Internet Registrations Australia stands accused of attempting to win over customers by offering them a participation in a domain name directory, on the proviso that the company be granted permission to "manage" the domain name.

According to Bloch, this management clause is presented in the fine print of the agreement, and will result in domain name holders unwittingly signing their domain name renewals to Internet Registrations Australia.

"Domain name owners in Australia are constantly sent a barrage of applications for renewals, and requests for payment," Bloch said. "All it does is confuses customers--the people sending these things out often have no idea how long the domain name is registered or when the renewal is due, they essentially try to trick them to sign up with another company."

Bloch did not limit his attack to those carrying out such practices--he also targeted Melbourne IT, the auDA and the ACCC for their failure to place appropriate restrictions on an industry rife with what he describes as unethical marketing practices.

"There have been various attempts to limit these practices, but when it comes down to it, there is no will on behalf of Melbourne IT to address the practice, the auDA has been slow moving and inefficient, and the ACCC has been nothing short of pathetic when it comes to stamping out unethical marketing practices which are making it almost impossible to operate as a domain name reseller," Bloch said.

In a separate but related incident, domain name reseller Internet Name Group (ING) has pursued legal action against auDA Name Policy Advisory Panel member, Joshua Rowe for allegedly publishing copyright-protected marketing documents on various chat sites.

While the case has yet to be argued in court, Rowe published the documents, in support of his claim ING was using unethical marketing practices similar to those that have so angered Bloch.

"ING are now trying to scare com .au domain name holders into buying the same name in the .com space to prevent cyber squatting," Rowe wrote in preface to a series of addresses which linked through to scans of ING marketing material.

Rising to defend such practices, ING general manager, Mark Spektor, said his company was operating within legal boundaries, and that it was legitimately contacting domain name holders, using publicly available information.

"There are a lot of service providers that are upset with us but they just have a sour taste in their mouth because we are successful at what we are doing," Spektor said. "As far as we are concerned, we are creating competition in the market place."

In reference to the company's marketing campaigns--which include sending invoices directly to the accounts departments of domain name holding companies--Spektor was adamant such practices were within legal bounds.

"What we are doing is not illegal, we are just more careful when it comes to researching our marketing databases," Spektor asserted. "Rowe has been conducting a smear campaign against us for sometime and has refused to desist, despite repeated warnings. We have been left with no alternative but to take legal action."

Bloch, on the other hand believes it is up to the ACCC to stamp out such practices.

"What these companies is doing, while legal, is certainly unethical. They are soliciting customers by spreading unfounded concern and charging above the market rate for their services," Bloch said. "They are gaining a wider customer base by misleading the public, and can only be stopped through a concerted information campaign run by legitimate domain name registering companies."

Bloch told ZDNet Australia he would not rule out directing customer complaints against such practices to staff at the ACCC, in an attempt to force them to react.

At this stage Melbourne IT have declined to comment on Joshua Rowe's stand against ING.

ZDNet Australia also contacted Internet Registrations Australia, the auDA, the ACCC and Joshua Rowe, and any further responses will be published as they come to hand.

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Talkback 7 comments

    I agree. Internet Registration ...Anonymous -- 27/11/01

    I agree. Internet Registrations Australia are very persistant, and are verging on being unscrupulous

    Devious and sneaky is only the ...Bruce Rivendell -- 27/11/01

    Devious and sneaky is only the half of it!

    I think "a deceptively misleading, sneaky, slimy attempt to mislead the public" is a very mild description of the practices if IRA.

    Their first offering was bad enough - an invitation to register with them, but was set up to look like a renewal. I've spent ages chasing round our business units trying to ensure that they don't make the mistake that the "renewal" clearly invited.

    This new trick is really devious. You have to follow up the terms and conditions on the web site before you realise that ticking a box to get a "free" entry in a directory means that you sign over registration to them.

    The worst part is that they are charging half as much again as INWW!

    My attempts to talk to them led to feigned innocence. They claim to have no intent at all to deceive. AS IF!

    Kettle calling the pot black. ...Not on your life -- 27/11/01

    Kettle calling the pot black. Bloch's outfit is one of the pioneers of this behaviour and has simply set the benchmark.

    Being in the industry we find a reasonable period of our productive time is spent dealing with customers receiving these solicitations and its (politely put) more than a little annoying.

    I think all of the registry oganisations need to be looked at. Melbourne IT is also a serious problem with incredible practices that defy belief. Operating on their own terms and without and form of recourse. But thats what you get with Monopolies, and Melbourne IT is still a monopoly.

    Absolutely astounding that this situation here in Australia could have ever happened, but thats what you get when your in the right place at the right time, and Alston is your mate. You can't tell me that grin on his face isn't due to to his private retirement fund.

    I am still furious that we got ...Anonymous -- 28/11/01

    I am still furious that we got scammed by this. Melbourne IT are ultimately responsible. When I contacted them, they really didn't not seem to care, but I think their name has been dragged through the mud.

    I agree with Bruce Rivendell. ...Anonymous -- 28/11/01

    I agree with Bruce Rivendell.

    The practices described have caused dozens of my clients, many of whom are not internet savvy but own websites to call me worried about the registration of their domains.

    The mailouts are dishonest and give the unitiated the impression that if they don't re-register immediately at an inflated price they will lose their domains.

    The practice must be stopped!!!!

    It's quite a laugh to see Larr ...Anonymous -- 28/11/01

    It's quite a laugh to see Larry getting so upset when it was his company that got booted off the Aunic database for breach of rules. I think Net Registry is just as bad, if not worse than ING , IRA and MIT.

    quote from the article - ( Blo ...mervyn Morrice -- 19/12/01

    quote from the article - ( Bloch told ZDNet Australia he would not rule out directing customer complaints against such practices to staff at the ACCC, in an attempt to force them to react. ) I wonder if it was Larry Bloch that reported himself to the ACCC for spaming the aunic data base. Shame on you little larry

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