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Investor's Business Daily

Internet & Technology

Friday, September 5, 2003

Squatters Still Set Up Shop At Various Places On Web

BY PETE BARLAS

Trolling remains alive on the Web — and it's still a fishy business.

The term refers to individuals who try to hook unsuspecting Web surfers by setting up sites to which they might accidentally go if they slightly misspell a name, such as by typing spint.com instead of sprint.com.

Trolling has declined in the last few years, but the problem still nags many companies.

People who use this ruse are called typosquatters. They set up Web sites with names just slightly altered from familiar names, or that are in other ways are deceiving.

Typosquatting is closely related to cybersquatting, though in the latter someone claims a well known name as a Web site name.

Recent Brosnan, Porn Cases

This week, two separate cases focused on each problem. On Wednesday, federal agents arrested a Florida man, claiming he tried to get child Web surfers to look at pornography by using domain names that slightly misspelled such words as Disneyland and Teletubbies. And in a cybersquatter case, actor Pierce Brosnan on Monday won a ruling from international arbitrators giving him legal control of the piercebrosnan.com Web site.

While these two cases attracted much attention, for the most part the problem is behind the scenes. But the problem is as old as the Web itself, says Francis Gurry, assistant director general of the Geneva-based Arbitration Mediation Center of the World Intellectual Property Organization. The global group arbitrates disputes involving companies and typosquatters.

"It's a consistent trick played by marketers to divert traffic away from legitimate Web sites," Gurry said.

In many cases, typosquatters have set up the misspelled address sites to take consumers to "directory" sites such as Megago and Netster. These sites have links to many e-commerce sites.

But even surfers who click on no links and exit the site right away might well be subjected to a number of pop-up ads. And those who run the sites win, since they often are paid by pop-up advertisers based on how many people see an ad.

The bogus addresses likely will hook more and more people. That's because the number of U.S. Internet users is expected to grow to 218.6 million by 2007 from 141.3 million in 2001, says market tracker Jupiter Research. That represents a lucrative opportunity for some marketers-turned-typosquatters, says Perry Binder, a professor of legal studies at Georgia State University.

"They'll register a few domain names hoping to divert traffic to their sites and make some money with pop-up ads," he said.

WIPO serves as a one-stop legal outfit to settle typosquatting cases. It also handles cybersquatting cases. In these cases, often an individual or company buys or sets up a Web site address or domain name with a well known company name or brand hoping to sell it for big bucks to the true firm or brand owner.

Earlier this year, WIPO received its 5,000th case since it began reviewing typosquatting and cybersquatting in 1999.

It averages 3.5 new cases a day, but that's down from 5.5 in 2000. Most cases are cybersquatting, but a steady number are typosquatting.

Besides Sprint Corp., (FON) companies targeted by cybersquatters and typosquatters include Amazon.com Inc., (AMZN) Barnes & Noble Inc., (BKS) Air France and AT&T Corp. (T)

"In the last year, we've had a dozen or so (typosquatting) cases," said Frank Politano, trademark and copyright counsel for AT&T. "It started rearing its head in 2000 and 2001, and it's started rearing its head more often in the last year."

Typosquatters have set up Web sites using such names as attt.com, atttelephones.com and atandtwireless.com, though all of those are out of commission now.

The ATTTWireless Site

Late last year, AT&T filed a complaint with WIPO concerning a man in Luxemburg or Belgium who set up a Web address, atttwireless.com.

AT&T licenses the name "AT&T Wireless" to AT&T Wireless Services Inc., (AWE) a spinoff company.

People don't find anything about wireless services when they type in atttwireless, says Politano. He says the person who registered that site "cut a deal to redirect traffic to a porno site."

The attorney says AT&T has no idea how long atttwireless.com remained active or how many consumers it snared, but it's not shut down.

AT&T gets a lot of Web traffic, more than enough to entice typosquatters, says Politano. "It must be lucrative for them because they keep doing it," he said.

Cybersquatters and typosquatters keep trolling because it costs so little to register a new Web site, says WIPO's Gurry.

"You can get a domain name registration in a matter of seconds, and it costs only $25 or $30," he said.

But it can cost victimized companies plenty. AT&T spends up to $8,000 on legal fees for each typosquatter case. The fee rises if the Web site operator attempts to argue the case.

Most of these people don't go that far, says Politano. "In 90% of the cases there's no response," he said.

But there's a cost associated with confusing customers, says Gurry.

"Companies have to protect their name and reputation," he said. "They don't want to be associated with a porno site."

Consumers shouldn't confuse typosquatter sites with gripe sites. These sites typically have addresses that include a company name and the word "sucks."

Courts have let such sites continue because the word "sucks" is enough to indicate it isn't a company site, says Georgia State's Binder.