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Google Inc. has sent out email notifications on January 24, informing its business partners of a change in the way the company deals with advertising-generated revenues. The new policy is aimed at tackling the prevalent practice of 'domain tasting', which critics believe hurts legitimate domain ownership. The practice of domain tasting takes advantage of the Add Grace Period (AGP), which is the allocation of a 5 day grace period during which time registrants can cancel their request for a domain at no cost. Several online businesses have been set up to take advantage of this loop hole, which through the advent of technology has allowed for the automation of this process, whereby millions of domain names have been acquired by a handful of owners. (Source: domaintools.com)
The intended purpose of the AGP was to allow registrants of domains adequate safeguards to protect them from mistakes such as unintentional typos. However, this policy has been exploited by online entrepreneurs through a practice known as 'typosquatting', which seeks to generate revenues by advertising on domain names that are very similar to those of established companies and brands. (Source: pcpro.co) Relying on the heavy traffic to these established websites, companies engaged in typosquatting rely on high instances of mistyped URLs to generate advertising revenue on their phony domains. However, Google Inc.'s revised policy, due to go into effect sometime in February, will prevent domains from generating any advertising revenue whilst they are still in the AGP. This is a significant move on the part of Google Inc. in preventing millions of domains from being tied up. (Source: dailytech.com) The company is set to lose millions of dollars in advertising revenues, which it generates from advertisers regardless of whether ads are posted on legitimate domains or those owned by domain tasters. In a statement, Google Inc. spokesman Brandon McCormick hailed the move saying, "We believe that this policy will have a positive impact for users and domain purchasers across the Web." (Source: dailytech.com) Google Inc.'s decision to distance itself from this type of enterprise has a little something to do with forthcoming litigation from companies impacted by these practices.
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