Yesterday I began looking at the registration of recently expired .uk domains, prompted by this month’s Nominet report on the state of the domain name system. The report shows that a significant minority of expired domains (about one in 14) is registered within 10 seconds of becoming available for new ownership.

Dropcatching - grabbing expiring domains - is perfectly legal under Nominet’s rules. After all, the old owners only have themselves to blame if they lose ownership inadvertently. However, as I wrote yesterday, it’s unclear why Nominet has not made the resale process fairer - particularly given that some domains are worth very large sums of money.

It turns out that Nominet addressed this topic at the 7 November meeting of its Policy Advisory Body (PAB). Emily Taylor, director of legal and policy at Nominet, wrote a paper on domain re-registration specifically for that meeting.

Taylor told me this afternoon that there is often “a gap between what people expect, and what is actually happening”, but that Nominet is wary of introducing changes that might make matters worse. As she puts it, “Is there a problem, and if so what is a proportionate and effective response?”

Yesterday I suggested a sealed bid system might be appropriate, and indeed Taylor says Nominet has discussed “a wide spectrum” of responses: “If people think there should be a more even playing field, there’s a lot that can be done,” she said. Indeed, the agenda for the 7 November meeting lists the re-registration topic under “Wait list, auctions and lotteries”.

It seems clear to me that change is needed. As Taylor explained, some naive domain owners have even assumed that the easiest way to switch registrar is to let the domain lapse and re-register with a different firm. As Taylor’s paper explains, this tends not to work: “We are routinely asked how best to acquire a domain name if it is not renewed. The honest answer is ‘you won’t’... The technical resources and ability of dropcatchers make it highly unlikely that ‘ordinary registrants’ will be able to register a domain name on cancellation.”

As the report explains, even legitimate registrars would be lucky to successfully dropcatch a valuable domain:

“• Significant advantage is gained by a minority of registrars who circumvent our current systems (e.g. through creating fictitious memberships, and thus doubling access limits). We actively look for these and have implemented additional checks, but the practice continues.
• We are concerned that our current systems and processes may favour a very small subset of our stakeholders, to the detriment of the majority. Whilst fair competition between registrars is beneficial to the wider community, we are becoming increasingly concerned that advantage for a few is being gained through unfair means.”

Despite these findings, Taylor says change is not imminent. “It’s really early days and it’s hard to tell you the timescales - it could be months - it takes time to consult and to get [our response] right,” she said. “The PAB gives advice, but we also do wider consultations very regularly. It may well be appropriate to go wider in this case.”

Nominet is clearly interested in feedback on this issue, so if you have a view - either in favour of the status quo or urging for change, you should not hesitate to let Nominet know.

To check the other side of the coin, I contacted some of the people who took issue with my post yesterday, who I assumed to be domain traders set up as registrars.

Tony, who said he is not a registrar affiliated with Nominet, said, “I do not have any objections to a sealed bid system in principle ... [but it] would not work, however, because although you highlight that it would ‘make more money for Nominet’ (a mere profit shifting exercise at best), Nominet cannot be seen to make a profit - and I believe its articles of association would prevent it from doing this.”

Tony is right - any sealed bid system or other mechanism would have to be done at arm’s length, through third-party registrars, because Nominet is a not-for-profit organisation. And as Tony pointed out, Nominet already brings in more revenue than it knows what to do with. “I would much rather the company revised the charges it makes, but it is clear that Nominet UK would rather continue to amass this level of reserves, and frankly distribute them in a way which was not really intended when the company was established,” Tony said. “I rather think that Nominet UK is an iceberg, in that there is significantly more to it than most people can see.”

Tony added: “It may surprise you to know that in a fair number of cases, [domain traders] are just as critical of Nominet UK as you appear to be. Maybe for different reasons, I acknowledge, but it stems from the underlying problem of [Nominet’s] monopoly position ... and the fact that it is a private company.”

There are clearly two sides to this debate, but ordinary businesses and end users are unarguably caught in the middle.

I’ll keep you posted.