What are the challenges of pay-per-click advertising in the domain space?

Monte: Right, good. Now, let’s talk a little bit about pay-per-click infringement.

Ari: Yeah, that’s--

Monte: Tell--

Ari: --another--

Monte: -- there’s a lot of domainers online, actually, and listening, that use PPC revenue, search pages, and, obviously, you’re very informed in that business, as well, having domain names yourself, and so let’s talk about those issues.

Ari: Right.

Monte: What to be conscious of, what to look out for, how the industry’s potentially gonna change for that.

Ari: Absolutely. Well, you know, pay-per-click and domain names is, you know, it’s a marriage made in heaven. It’s very lucrative. People typing in a particular domain name, looking for a particular type of product or service, you own that domain name, you put links associated with that product or service, people click on the links, you get a share. It’s a great business, everybody knows that, that’s the business that’s powering the whole value of, you know, the upswing and the value of domain names over the past couple years. However, you need to be very, very careful. If you have a domain name, even if it’s a generic domain name, okay, you need to be careful that you’re not putting up pay-per-click ads that relate to trademarks for the term. For example, let’s say you owned Apple.com, and even Apples.com, you would not want to have ads for Dell Computers or even Apple Computers or Macintosh or Hewlett Packard or whatever, it’s very risky, ‘cause then the trademark owner can file a Complaint against you and argue hey, you know, this person is--

Monte: You’re misleading my customers or [inaudible].

Ari: You’re misleading my customers that are looking for me; you’re obviously trying to play--you know, make money off of my mark. So it’s common sense.

Monte: Now, here’s the challenge, though, because as you know, many people don’t have that choice. They go and sign up with a domain sponsor or with, even with Direct [inaudible] or Overture or Google or sign up for these things, and the linguistic engines are breaking apart the word and putting the ads that are relevant to that particular industry per say and not specific to the actual domain name that’s being typed in.

Ari: Well, I think that the domain owner has to be alert, and I think if they contact the sponsor, the, you know, the pay-per-click service, I think that they would find a lot of support in modifying the links that appear.

Monte: Oh--

Ari: I think that’s what needs to be done.

Monte: Oh, I know, that’s what needs to be done, it’s just a--I know it’s challenging because a lot of people like, you know, a lot of people like the hey, I’m gonna turn the names on, I’m gonna leave it to domain sponsor to optimize it, I’m gonna--you know, or to another pay-per-click provider, and I want my life easy, you know, I don’t want to have to worry about this stuff. Now, little do they know, that this could come up as a complication in their life, that they could actually be sued or have a case presented to them because there are links that are being provided based off of a particular brand or identity or key word in that domain name that are infringing or confusingly similar to, you know, a company’s mark.

Ari: It happens every day, and--

Monte: It happens every day, right And as a matter of fact, ironically, I had Best Western contact us the other day, so this domain name, there’s a particular domain name that used to be at Moniker, that had something to do with Best Western. And the paralegal got on and then she got her--the main attorney on for Best Western, and they’re saying, “You know, this is gonna change. We are gonna--this type of PPC process is gonna change. If we didn’t pay to have this ad up or any ads up for our company, what makes you think that our client is gonna stand by and let a competitive, you know, hotel display their links, when somebody’s trying to look for Best Western?”