Domain Name Monetization

* Pay-per-click (PPC) : is when someone, a registrant, registers a domain name that might attract a large number of Internet users to it. The registrant then hosts revenue generating content or links to other websites at the domain name, which typically feature advertisements for products or services related to the name. Each time a user visits the website and clicks on the one of the links or advertisements, it creates revenue for the registrant. The more popular the domain name is in terms of being able to attract
traffic, the more revenue the registrant generally receives per click.

While the amount of money received for each click is often relatively low, the cumulative amount received from all of the clicks throughout a year can result in an extremely lucrative revenue stream, particularly for registrants holding many domain names.

* Domain parking : is a practice used by registrars, individual registrants and Internet advertising publishers to monetize type-in traffic. Type-in traffic refers to Internet users who visit a web-page by typing its URL directly into their browser rather than by
clicking on a link from another page such as a search engine result page. Proponents of domain parking say it uses domain names to deliver relevant advertising and enhanced search options instead of serving Internet users with an error page often referred to as a
404 file not found." With parking, the Internet user is taken to a landing page that has links that generate income for the person or company hosting the site similar to the PPC model described above.

Traffic can come from several sources, including out-of-date bookmarks, people typing in the registered domain name, or search engine results. A registrant, for example, may register a domain name but may not be ready to establish a website yet. The registrar then parks the registrant's domain name on a website that features paid links. Each time Internet users try to locate the website that would correspond to the domain name, they will be directed to the parked page that features an array of advertising links, often offering goods and services related to the domain name. When the user clicks on any of these links, it generates revenue for the registrar, and depending on the terms of the
registrar's parking program, the registrant as well. Some estimate that large registrars earn millions of dollars each year from the PPC fees they earn on parked websites.

* Domain name tasting : is the practice whereby a party registers a domain name to test whether it has sufficient value to justify payment of the associated registration fees. The value of the name is often measured through the use of a website at the domain. Traffic to the name and revenue derived from the PPC advertisements are evaluated to determine whether the name will be worth keeping. In most TLDs, registrars may delete a registration within 5 days of its creation and receive a refund of the registration fees from the registry.

This Add Grace Period (AGP) was created to allow registrars to correct legitimate mistakes, but it has become the basis for Domain Name Tasting because some registrars allow their registrant-customers to delete names during the AGP and receive either a full or partial refund of the registration fees paid to the registrar. The AGP has enabled parties to register tens of millions of domain names each month before dropping all but the most lucrative within the 5-day AGP. In response, some registries, such as .ORG, have adopted excess deletion fees to curb the use of the AGP for domain name tasting.

"The trick is to sign up for millions of domain names; set up pages and run ads on them; after one day delete domains that have no traffic; after three days delete names that have some traffic; after five days delete pages with marginal traffic; keep the 1% of pages
that have enough traffic to be worth keeping the domain. Because of the refund policy, the 99% of pages deleted before the five day grace period are refunded in full and the monetizer gets to keep the ad revenue generated over those five days.

Domain name monetization techniques impact Internet users in different ways. The PPC model has been criticized for increasing the prevalence of cuber-squatting and speculative behavior by encouraging parties to grab names that are similar to famous brands or people and are therefore more likely to generate significant traffic. It has also raised questions about whether "good names" are being used solely to create paid links and PPC revenue, rather than enable new users to create an online identity or substantive content.

Tasting, which results from taking advantage of the add grace period, has been the subject of particular discussion and concern. Because of the volume of the activity, there are concerns about taxing the registry system and DNS, and thus increasing the costs for all registrants. There are also concerns about increasing the prevalence of intellectual property abuse, since the domain names being tested are often misspellings or variations of trademarked names, and enforcement of trademark rights can be very difficult when the name exists for only a short period of time. This can lead to consumer confusion and increase the cost to trademark holders of monitoring their brands.