Back-Ordering Domains

Netfleet has a great back-order service. For $200 up front, you can take a punt and hope that the name you want doesn’t get renewed for some reason.

Probably the number one reason why some domains expire and go to the drop auctions is that the registrant contact email address is out of date. An employee who looked after the domain renewal could have either left or be on extended holiday – or there are many other reasons e.g. a business may have folded or been taken over by another company.

And if you think this doesn’t happen often, then you just have to check out the expired auctions every day!

There are some very smart operators who in their search for domains come across such potential situations (like a business having folded etc), and they get a back-order in. This is a quite legitimate way to make some excellent acquisitions.

Then There Is The Nasty Side

Not going to sugar coat this. I have written about it before. Because of the auDA’s rules and policies, registrants must remain eligible to hold domain names in Australia.

There are certain people who I classify as “ambulance chasers” – they are constantly on the hunt for errors in registrant details e.g. expired ABN / ACN or an old State based Registered Business Name. A few other reasons as well.

So what happens is they make an anonymous or confidential complaint to the auDA; and if it looks like it will be accepted, they place a back-order with Netfleet.

A recent case was DIY.com.au – I wrote about it here.

I think that is wrong – as do many other domain investors – including lawyers! The person that made the complaint and was lucky with the backorder is apparently “related” to a domainer.

Here are a couple of interesting links which give you a bit of an indicator:

Link 1 – DNTrade  (interesting to read Snoopy’s and David Lye’s comments – I agree with them totally).

Link 2 – DNTrade

This same person immediately put it back up for sale on Netfleet (I hope they didn’t purchase for the sole reason of re-sale! auDA wouldn’t like that!)

 

Netfleet DIY

What Should Happen In The Future?

Netfleet recently published their “November News” – in which they congratulated themselves on their “success” in the back-order of DIY.com.au.

We have recently seen an increase in the use of our back ordering system, and for good reason. Its an easy submit and forget way to secure the best name for your business just a few days ago the back ordering system was able to snap the domain DIY.com.au.

I agree with many others. Whilst back-orders are great, they should not be allowed on Policy Deleted / Client Deleted domains. This has been suggested to Netfleet many times, and I believe they should take heed of it. Failure to do so will encourage “ambulance chasing”.

In my humble opinion.

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16 thoughts on “Back-Ordering Domains

  • November 24, 2015 at 7:05 pm
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    The guy runs an online pet business so he’s used to dog acts.

  • November 24, 2015 at 9:00 pm
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    Thanks for article Ned. Seems some people will go to any lengths to get an advantage over others.

  • November 25, 2015 at 6:07 am
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    It’s just someone using the system. Would this happen in any other market? auDA needs to change ridiculous rules where someone can lose a valuable asset because of an opportunistic complaint.

  • November 25, 2015 at 8:30 am
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    What a grub.

    @Troy I agree with you, but who knows how many complaints this individual has lodged. I’m in the camp that believes there should:

    Be some level transparency
    A cost associated with lodging a complaint
    Backorders banned on deleted domains

    • Ned O'Meara
      November 25, 2015 at 1:05 pm
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      @Barb

      Be some level transparency
      A cost associated with lodging a complaint
      Backorders banned on deleted domains

      Agreed!

  • November 25, 2015 at 12:49 pm
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    As****a has always been a bit ethically challenged. I remember he tried to cheat NF out of their commission on a purchase via their system. That said he is following the rules. There will always be someone like that that will push the boundaries.

    https://www.dntrade.com.au/threads/buying-domains-sale-agreement-template.7761/

     

    The solution is to change the rules and I agree asking NF to cancel back orders on PD’s is a step I could live with. Also as they’ve probably just lost $10k on this domain, it would also be in their best interest.

    Anonymous likes this.
    • Ned O'Meara
      November 25, 2015 at 1:04 pm
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      @David – I’d forgotten about that one!

      “I remember he tried to cheat NF out of their commission on a purchase via their system”.

      Anyway, the DIY transaction was not him – it was a “relative”. 😉

  • November 25, 2015 at 1:05 pm
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    I am yet to form an opinion on this issue (seriously), but would appreciate it if someone could spell out what it is that makes challenging a domain name on policy grounds and then securing it via backorder unethical.

    The only bases for deletion of a name are ineligibility (as determined by auDA and policy), failure to update out-of-date contact details upon request and non-existence (deregistered company ie. the entity does not exist). Before a name is deleted, the existing registrant is given every opportunity to comply with the auDA policy they have breached. When a licensee first registers the domain name, they agree to be bound by those very policies and accept that breaching them may result in cancellation of the domain name licence. Domain names are licences, subject to the stipulations of the licensor.

    If, then, a domain name licence is cancelled in accordance with the wishes of the licensor (as stipulated in auDA policy), then there is no sound basis for grief by the losing registrant, which/whom has chosen not to live up to the terms of their licence agreement. In fact, it is the losing registrant that has acted unethically, by representing to auDA that they will comply with its policies but then failing to do so.

    If the losing registrant has no sound basis for grief, then who does? The people most vocal about this issue are self-interested domainers, including the lawyers you refer to, Ned. When a name is caught for someone that has backordered the name prior to challenging it, it is domainers and end users that are aggrieved, since they have missed the opportunity of bidding for it at auction. Do they have any right to do so? No. They had every opportunity to backorder the name for themselves. Is it unethical that they are beaten to the punch? No. Remember, domainers beat end users to the punch each and every day on the drops.

    If you’re so concerned about a level playing-field, shouldn’t the ability to generate 30-day drop lists and the continuing practice of approaching end users well in advance of the drop date be of greater concern?

    PS. Whether or not the new owner of DIY.com.au was responsible for its cancellation, we do not know. But where a name sits idle and the registrant is ineligible to hold the name, should not its cancellation be welcomed? -After all, it is now available for purchase and use by an end user.

    • November 25, 2015 at 3:20 pm
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      Lodging a policy complaint of itself is not the issue, the issue is using the system in bad faith to facilitate a back order on the domain. It is a sophisticated way of stealing a domain name, that is why people are up in arms about it. People who engage in this behaviour are bottom feeders in my view.

      The auDA complaints process cannot be used to facilitate the theft of domain names, that’s the real issue here.

    • Ned O'Meara
      November 26, 2015 at 7:56 am
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      @Malcolm – firstly, thanks for your contribution. Some well argued points. You almost sound as if you’re from the auDA! 😉

      But I’m with Bill above. The auDA complaints process should not be used as a sophisticated way of acquiring someone else’s valuable cyber property. Netfleet backorders are great – and I mean that sincerely. But not when they are used in tandem with a self-serving complaint.

      I got harangued on LinkedIn two nights ago by the person whose relative acquired DIY.com.au by this method. He said I was only creating a fuss because I couldn’t get the domain! This is what I said to him by reply (and I have my hand on my heart when I say this):

      Many people wanted the domain – and we just wanted a fair bidding contest. But you know what I would want even more than that? I would genuinely want the original owner to have kept his domain and not lost it to such tactics“.

      And for those that didn’t have access to Link 1 in the main article, let me tell you what David Lye (the founder of Netfleet) said four years ago on DNTrade when a similar situation was discussed.

      One poster said:

      “Domain equivalent of ambulance chasing?”

      David’s response was this:

      “That’s what I was thinking… isn’t this just making a malicious complaint to try and acquire a domain you want?

      We all complain about restrictive policies making our lives harder but then when it suits us try to use the policy to wrangle a domain off another registrant.

      Offer to buy it instead…

      Sorry but I don’t agree with the backorder then dob strategy.”

       

  • Ned O'Meara
    November 25, 2015 at 1:45 pm
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    Attention all prospective posters!

    Once again, just a note for any poster on Domainer.com.au. I’m happy for you to remain anonymous or use a pseudonym – but to cover my “publisher’s ass”, unless I know who you are, I need a legitimate email address when you first post.

    This is solely for my protection, and will not be made public (unless required by law).

    So if your posts don’t get “posted”, it’s only because I don’t know who you are – and / or you haven’t replied to my confirmation email.

    Cheers, Ned

     

  • November 25, 2015 at 2:44 pm
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    I don’t see the problem here. The rules are there for everyone to follow so if the holder was ineligible then the complaint was justified. I’m sure Netfleet aren’t concerned about the amount bid on DIY.com.au because the domain probably wouldn’t have dropped without the complaint so they’ve made $200 more with the backorder than they probably would have. I wonder if people are just complaining about the backorder because the Netfleet success rate is so good and they would have liked the opportunity to grab the domain name for themselves. Let’s not lose sight of the fact that it was the registrant who was in the wrong here and not the complainant or eventual registrant. The tight enforcement of the eligibility rules is what has made .au domain names so trusted and why we do not see the same level of problems involving .au domain names that we might see in other domain name spaces.

    • November 26, 2015 at 6:55 am
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      Peter – Netfleet would have been spewing that this premium name slipped through the cracks and was allowed to be backordered. Couple of examples for you. Go to their backorder page and try backordering sex.com.au and buy.com.au.

      sex.com.au cannot be backordered as is on our exclusion list.

      buy.com.au cannot be backordered as is on our exclusion list.

    • Ned O'Meara
      November 26, 2015 at 8:06 am
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      @Peter – thank you also for your contribution. Even though I don’t agree with you, I respect your right to express such an opinion.

      My answer to you is encapsulated in my answer to Malcolm.

      @Jason – good points. I just looked up DIY.com.au on Netfleet’s backorders, and it says:

      “diy.com.au has already been backordered”

      Ha ha! I wonder if someone is taking a punt that the new owner will be deemed not to have a “close and substantial connection” and has also filed a complaint and a contemporaneous backorder. 😉

  • November 25, 2015 at 6:15 pm
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    The rules don’t account for all the possibilities. They are so bound up in eligibility issues that they can catch some registrants unaware of their responsibilities. Often it occurs when companies are taken over and the original registrant no longer exists.

     

    The rules are complex and they do trip lots of people up. Taking advantage of other peoples lack of knowledge of a complex issue is something I’d consider unethical.

     

  • Ned O'Meara
    November 26, 2015 at 8:13 am
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    Just had a look on Netfleet again – DIY.com.au has now been removed from sale on their platform.

Comments are closed.