What is Domain Name Frontrunning?

In an Internet-based economy, having a great domain name for your business is often crucial to your success. However, unscrupulous individuals are increasingly attempting to profit from the desire for original domain names through the practice known as domain name frontrunning. When someone uses inside information to register a domain name for the purpose of selling the site for a profit, this is known as domain name frontrunning.

Many people have compared the practice to the activities of a stockbroker who buys or sells shares ahead of a client’s trade, in anticipation of a sudden change in price. Domain name frontrunning is often confused with the practice of domain tasting, in which someone buys a site and places advertisements on the homepage for the five day trial period to assess whether or not the address would be worth the specified registration fee.

There are a number of techniques that can be used in the practice of domain name frontrunning, including DNS operators, name spinners, client software, and unauthorized executables. Information leaks are another possible source of the problem if the domain belongs to a start up with weak security. Some people have even gone as far as to suggest that domain name registrars, companies that allow people to register Web addresses, are selling search data to third-parties for a quick profit.

The Internet Corporation for Assigned Names and Numbers (ICANN), the non-profit organization founded in 1998 to develop policies on the Internet’s unique identifiers and coordinate efforts to create a global communications system, has been widely criticized for failing to take enough action regarding the issue of domain name frontrunning. Although ICANN has formed an advisory committee to look into the issue, there have been several lawsuits alleging the organization has complicity allowed Web developers and entrepreneurs to be victimized by domain name front running.

Protecting yourself from becoming a victim of domain name frontrunning can be difficult, since it’s often hard to prove whether or not two people simply came up with the same idea independently. In addition, it’s highly unlikely that the financial loss from one particular domain name registration opportunity would be high enough to justify litigation. However, one easy way to reduce the risk of losing your domain idea is to avoid typing your potential address directly into your browser to see if the URL already exists. Many major ISPs have policies allowing them to sell data regarding non-existent domain name results.