What Is Domain Squatting?

Bruno Mircevski

Web Hosting Expert ··Hosting Services Explained

What Is Domain Squatting?

If you wish to have an online presence and a place where someone can find you or your business, you give them your domain name, which is essentially your website's name and address. Seeing as the number of websites grows each year, having reached 1.1 billion in 2022, domain squatting is a prevalent issue that could happen to you. So, let's see what it entails. In this article, we will discuss the following:

What Is Domain Squatting?


The most important difference between legitimately buying domains and domain squatting is the intent. Domain squatting is done with the goal to buy popular domains and make money off of someone else's brand name. Squatters also buy domains to resell them at higher prices later or to put ads on that domain and make money that way.

Domain squatting differs from domain flipping because, with domain flipping, the person buys a non-trademarked domain name for a low price, doesn't do anything with the domain, and waits to resell it for the highest price. Domain squatters buy trademarked domain names on purpose so that they can use them for their own benefit, as mentioned above.

According to Palo Alto Networks, over 13 000 squatting domains were registered in 2019, with over 18% of them being malicious.

Is Domain Squatting Illegal?


Domain squatting is considered illegal because it blocks the rightful owner of a trademark or brand from buying the appropriate domain name.

Domain squatting is viewed by the law as equivalent to holding a property (the domain name) for ransom, and it is deemed a trademark infringement. If a domain squatter cannot demonstrate that they have a legal intent to possess the domain name, it is deemed a bad faith registration, and the squatter is charged with domain squatting.

The USA protects users against cybersquatting with the Anticybersquatting Consumer Protection Act. In the UK, you can take legal action against squatters through the avenue of trademark infringement, protected by the Trade Mark Act of 1994.

In contrast to domain squatting, domain flipping is a legal process of buying a domain name to sell it at a higher price quickly.

How to Prevent Cybersquatting?


Checking with the domain owner first

It's possible that the domain registrant's purpose isn't cybersquatting and that they got the domain that matches your brand name by chance. They may be willing to transfer over the domain to you for a small charge, which will not be a financial strain for you. As a result, you might want to talk with the individual to see if you can reach an agreement before taking other steps.

Preemptive domain registration

is one of the simplest and fastest ways to register the domain name you want before you start using it. It is best if you really buy the domain name because only adding it to your cart does not stop someone else from doing the same.

Registering similar domain names

another way is to buy domains with multiple extensions, like .com, .co, .biz., etc. Additionally, it would help if you considered buying the misspelled versions of your domain name. You can do this by researching the most common misspellings that customers make when searching for your website.

Purchasing domain ownership protection

you can purchase protected registration with some providers. This ensures that you will retain the registration of your domain name, even if you surpass its expiry data and want to transfer it to another provider.

Registering a trademark

you can legally protect your right to the domain by registering it as a trademark with the appropriate administrative body. This varies depending on the country your domain is registered in. For example, in the US, the body is the United States Patent and Trademark Office.

Be the rightful domain owner

to make sure your domain isn't being held hostage by someone else, your name should be on the domain registry. Even if a third party or employee registers a domain name on your behalf, be sure it's in your name.

How to Reclaim a Squatted Domain Name?


The two most common ways to reclaim a squatted domain name are the following:

  • By contacting the owner of the domain and settling the issue privately with them

  • By filing a UDRP claim or court proceeding, where you will need to file a complaint and communicate it carefully and in as many ways as possible. It is best if you choose a provider that is approved by the Internet Corporation for Assigned Names and Numbers or ICANN to oversee the administrative proceedings. Additionally, you should collect evidence of trademark or copyright ownership for yourself and prepare evidence of bad faith on the domain squatter's part.

  • If your dispute is international, than you should go through WIPO. WIPO provides arbitration and mediation services, in which a panel of experts evaluates the case and resolves the dispute.WIPO considers the UDRP in its proceedings.

Examples of Domain Squatting


Many of the biggest companies have been subject to domain squatting. Here are two examples:

  • TikTok – before the massive popularity of the app, two Australian friends anticipated it and bought tiktoks.com for $2000. And when they decided to reject the offer of $145000 that Tiktok's parent company made them, the company filed a cybersquatting case with WIPO that included four domains in total. Outcome: the panel ordered the two friends to transfer all five domains to Bytedance, Tiktok's parent company. For more details, click this link.
  • Microsoft – the tech giant decided to sue a teenager named Mike Rowe because of his mikerowesoft.com domain. Mike did not intend to cause trademark infringement. He wanted to have a cool-sounding name, a phonetic variation of Microsoft. Due to the public being on Mike's side, the two parties settled the dispute outside of court. You can find more details here.

What Is Typosquatting?


A cybersquatter uses typosquatting to purchase misspelled domain names for well-known brands. The purpose is to make a fake website that people will visit if they mistype a domain name (i.e., misspell it or press one or more wrong keys). Typosquatting is when a domain's original spelling is changed by adding or removing any numbers, letters, or periods.

Example:

Original: www.twitch.tv

  • Twitch.com

  • Twotch.com

  • Twitch.cn

  • wwwtwitch.tv

The goal of typosquatting is not to resell the misspelled domain later but to put ads on those domains and make money from the people who click on those sites by mistake. Typosquatting can be prevented by buying similar domain names to the original one you want, as mentioned above. Typosquatting has been illegal in the US since 1999, under the Anticybersquatting Consumer Protection Act.

Can You Buy a Taken Domain Name Without It Being Cybersquatting?


The easiest way is to find another suitable domain. However, seeing as this is not always the best option, these are the steps you can take to achieve this goal:

  • Check for the activity of the website

  • See if the domain is a trademark

  • Learn who owns the domain

  • Determine how much you would pay

  • Contact whoever owns the domain

A more detailed explanation for this process can be found here.

Final Remarks


Domain names are crucial for any business with a website, as that is how customers and partners can find them online. And with the online world expanding more and more, domain squatting has become quite prevalent.

However, it's something that can be stopped and even avoided if you're lucky. And seeing as you have to have a domain name, you have no choice but to face it head-on if it happens to you.

Frequently Asked Questions


What is a domain name?

Every single website has a domain name, and the domain name is the actual name of the website. You need to purchase one from a domain registrar.

What makes a certain domain valuable?

Valuable domains are usually memorable, easy to spell, pronounce, and short.

Is selling domain names for profit legal?

Yes, selling domain names for profit is perfectly legal. What’s not legal is purchasing a domain name that incorporates a trademarked name with the intention of getting profit from the reputation of the trademarked entity.

What are some popular domain marketplaces?

Popular domain marketplaces include BrandBucket, Efty, Namecheap, Sed, and Flippa.

Bruno Mircevski
About the Author
Bruno Mircevski

Bruno Mircevski is a web hosting services expert. He has spent years researching the niche, exploring the most diverse aspects of Shared, VPS, WordPress, Cloud Hosting, Dedicated Servers, Resellers, etc. With his extensive knowledge and experience, he can grant you meaningful insights on our blog, whether you are a beginner or a hosting pro.

View all posts by Bruno Mircevski
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