I know I'm reviving a relatively old thread here, but I've just run across this problem.
A few friends and myself want to start a small company. The problem is that we've found our domain is owned by HugeDomains.com. They advertise owning over 350,000 "premium" domains and WHOIS puts them well over 600,000 domains in total.
The domains themselves aren't doing anything - they're just 'buy' pages with prices that shoot up the moment it seems like somebody might be interested in them. For example, my relatively obscure domain (which I won't mention) is listed at $1500. I can't find a domain they offer that is less than $995.
Googling, it appears I'm certainly not the only one to encounter this. Most people seem to just pay the money. That's too distasteful for me; I'm a big believer in rewarding only what deserves to be. These guys added no value to the domain - "squatting" is the perfect word for it.
This is totally different from land. Land has an intrinsic value because it's a real thing and includes things like mineral rights. Domains like this only have value because of what I'm doing externally.
If I want to start a company XYZ (it's already a company, this is an example), the thing that gains value is the brand XYZ as a result of my hard work in the business. The domain xyz.com only increases in value because it's easily confused with my brand; similarly, these squatters can only charge such sums because I fear customers won't find me otherwise.
To compare this kind of squatting to owning land is just ridiculous. There are huge practical differences. Basically, if your .com domain is taken by a squatter, people won't find your site and it'd be better to change your company name. In reality then, these squatters are doing something more like trademarking every word they can think of.
Besides, it is doing a lot of real economic harm to startups like ours. We couldn't afford that domain, even if we did reluctantly agree to pay for it.
What these people want to do is to turn every not-found address in to an advertising space, and to punish the people who, unlike themselves, are trying to do some productive good for society.
Here's what I think should be done:
Domain squatting should be illegal, or at least taken much more seriously with bigger efforts to counter it. There should be a cap on the number of domains any single entity may own, as well as a maximum domain price (domains don't have to be sold if they're in use; but if they are sold, they may not be sold for more than $X. Otherwise charges will ensue). The registration fees should increase as the number of domains owned by the entity increases.
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Domain names are a relatively new form of intellectual property, the **** has yet to hit the fan
This is where I think the fundamental problem is: domain names, when taken by squatters, are not intellectual property.
According to Google (not sure which dictionary it gets this from):
define:intellectual property said:
in·tel·lec·tu·al prop·er·ty
noun
A work or invention that is the result of creativity, such as a manuscript or a design, to which one has rights and for which one may apply for a patent, copyright, trademark, etc
(emphasis added)
Yet they prohibit others from claiming their true intellectual property. That is, to prohibit them from naming their business something that is currently not used by any other business.