Cybersquatting is an abusive practice in which a speculator registers a domain name identical or very similar to the trademarked name of a legitimate company or other organization. The speculator can then hold the name for ransom, forcing the trademark owner to pay far more than the actual cost of registration.
Cybersquatters unfairly and illegally take advantage of the established value of someone else’s trademark. Under the Anti-Cybersquatting Consumer Protection Act of 1999, trademark owners can sue a cybersquatter or ask ICANN to arbitrate their claim. For small e-Commerce companies, the time and expense needed to understand and assert these legal remedies are often more than the owner can afford. Consequently, these businesses either continue to lose prospects to cybersquatters, or are forced to meet the ransom demanded.
Another variant in speculative domain name registration is “typo-squatting” or “parking” – registering domain names that closely resemble the names of already popular Web sites. Typo-Squatting sites confuse and divert potential customers. When a consumer types the domain name of a known website directly into the browser’s address bar, but mis-types the name, they’re taken to a different and sometimes confusingly misleading website. Legitimate businesses shouldn’t lose customers to websites traps designed to generate ad revenue.
