Special report Nominet, the operator of the dot-UK domain-name registry, has been accused of designing a scheme to give its largest members a £100m payday.
On July 8 this year, more than three million unregistered .uk domains – including household brands from Mars.uk, Heinz.uk, and Maltesers.uk to Colgate.uk and Lipton.uk – will be released to the general public to purchase.
But before that date, .uk overlord Nominet has decided to create a special one-week registration period solely for its members – the registrars that sell the domain names – who will be allowed to register whatever domains they want from the list at cost price, and then sell them on for a fat profit.
The value of those internet addresses is estimated to be worth anywhere between £10m and £100m, representing a massive payday for the companies that fund Nominet, a non-profit organization that is supposed to operate in the public interest.
Theoretically, the registrars are only supposed to register domains on someone else's behalf, but the system has been abused in the past, and Nominet has notably failed to take action. One large registrar registered millions of .uk domains and claimed they were doing so on their customers' behalf – even when those customers hadn't asked them to.
At least one registrar has also said with the new release of names that if more than one customer applies for the same name, they will put the name up for auction, creating a direct and significant financial benefit for registrars.
Even if registrars play by the rules, they stand to make millions of pounds in registration and renewal fees for domains that don't need to exist and which Nominet will be actively adding to its registry.
Just this week, the news that the domains were going to be released saw one multinational brand – Asda – register its asda.uk name. It's unclear how many other companies will be caught unawares by the release and so see their company or brand name appear in the .uk registry under someone else's name.
But in addition to Nominet's decision to give first dibs on millions of new names to its own members, the company has specifically designed the system to benefit its largest registrars – who have seats on the organization's board - and actively exclude smaller companies, according to an open letter from dozens of those smaller companies.
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Three of Nominet's 11 board members represent three of the world's largest registrars: GoDaddy, Key-Systems, and Names.co.uk. Another is a domain-name and brand consultant, and the remaining seven are from the corporate and finance worlds and from Nominet's top brass. No smaller registrars are represented. The big businesses stand to make millions of pounds from the system that Nominet has created to cover the release.
That was not by accident, say the smaller registrars who claim they were not informed about the special process and when they did find out earlier this month, Nominet informed them that they had already missed a registration deadline.
"Over 3 million remaining .uk rights are set to be released over the coming few weeks and so far, Nominet has proposed what we consider to be unfair and unequal access to those remaining .uk rights," a letter to Nominet's board, signed by 37 companies at the time of writing, complains.
In addition to not adequately informing them about the process, and introducing what appears to be an arbitrary deadline, Nominet decided to create an entirely new process for the release – even though the existing system is used to register and renew millions of .uk domain names every year. A key part of that new system is a pay-to-play approach that allows companies that pay Nominet more upfront to have more chances to grab valuable names.
If you pay Nominet £450, a registrar will be allowed to register six domains per minute; £4,500 will get you nine per minute; £45,000, sixty per minute; and £90,000, 150 per minute. The system appears specifically designed to make sure that Nominet's biggest members are given the biggest opportunity to snag valuable internet addresses.