Ever hear of cybersquatting?
It’s on the rise and every entrepreneur doing business or launching a startup needs to know about it. Moreover, how every entrepreneur can protect your startup business. Protect your domain name!
Domain Name Squatting, often also referred to as Cyber or Typo Squatting is a real problem. And, a growing problem at that. In 2012 alone, there were 2,884 new cyber squatting cases involving over 5,084 squatting domains. This is a 4.5% increase from the year prior.
You might be saying, that stinks but what exactly is that and more importantly, how do I avoid it?
To begin with, there are two main types of squatting business owners may encounter. The first is registering a domain name similar to another company or brand. This would include misspellings, plurals, and alternate Domain Name Extensions (i.e. .net, .hotel, .ext). Secondly, jumping on an expired domain and holding it for ransom.
In either of these cases, there’s malicious intent behind the squatting. From the least harmless is simply looking to drive traffic to another legitimate website site via misspellings. The more serious cases including blackmailing a business into buying their lapsed domain back at an exorbitant price. And to my personal feelings the most venomous, setting up fake sites on misspellings. Here there is an intent to deceive the unsuspecting into handing over personal and/or financial information.
What is Cyber or Typo Squatting?
The first type of squatting, (registering too close to another domain name) can be thought of as Trademark Infringement. The USPTO (United States Patent and Trademark Office) classifies Trademark Infringement as “Confusingly Similar.” In laymen’s terms, this is where someone is looking to benefit from someone else’s business or brand. Typically this is done by having a name, brand, or logo similar to another brand within one marketplace. Moreover, close enough were a customer could conceivably think your business or brand is or affiliated with the original.
If this happens, you will quickly get slapped with a Cease and Desist letter. Furthermore, they’ll be asked to stop their business, and force to you to change the “Confusingly Similar” aspect. If they don’t, they could face a law suit.
The last form of Typo Squatting is domain name registration laps squatting and is basically blackmail. Here someone will troll recently expired domains looking for one that had been dropped by accident, usually by a laps in registration, buy it and turn around to the original owner and demand a huge payout for its return.
The original company, while it is their fault for letting the name laps, is stuck as they would have to re-brand their business if they don’t have the domain. This blackmail is illegal and one could rack up some pretty hefty fines.
Domain Name Cyber or Typo Squatting Learn What You Need to Know?
With all the many different types of Typo, Domain, and Cyber Squatting on the net, we always advise our clients that if they have the money, you should always consider buying similarly spelled domains and plurals. At $12 to $15 a piece, it’s an insurance policy and added level of protection from the evil in the world.
It also means that you should make sure that your domain name is registered at all times. Most Domain Name Registers have an auto renew feature where you can have the company charge your card annually; taking the guess work out of when your payment is due. The only problem arises when you switch your credit card or it expires buy Registrars in the business of keeping you so, they’re very good at contacting you when your payment doesn’t go through.
On a note to leave you on, as a business owner, you should always be aware of someone trying to take advantage of you in any why they can. Every so often, check if anyone is squatting on your business!
Update: NBC Nightly New aired a piece about the spike in Typo Squatting and how thousands of people each year are being lured into divulging personal and banking info to unscrupulous people.
Thanks for all the great info. This is another reason why you really want a unique brand name and domain name. The more creative and different it is, the better you’ll be able to protect it.
Thanks for the great and insightful comment, you couldn’t be more right. If you business name and domain name looks just like the rest, you’re going to have a hard time protecting it if the time comes. If your business name is different from everyone else, if it really stands out and is unique and suddenly there is a name shockingly similar to yours, you’ll have a better foot to stand on if and when you need to defend it.
You can send the cease and desist knowing that your name was different and knowing that you’ll have a better chance to defend it. Thanks for the comment.