May 4, 1996 7:00 AM PDT

What's in a name? bigmoney.com

On the Internet, a domain name isn't just how people find you--it's big business. So say the growing number of companies snatching up names that range from the heavily branded like pepsi.com to the mundane such as cat.com, in an effort to lure people to their Web sites.

This week, the mad scramble for domain names--the unique addresses used for Web sites and email addresses--was highlighted when a man from St. Paul, Minnesota, offered to sell rights to television.com, to the highest bidder. Mike O'Connor had registered the name two years ago and recently several companies, including CNET: The Computer Network, made substantial offers for the name. But the bids still fell short of O'Connor's expectations.

"I received several significant cash offers during a two-week bidding cycle that ended on Friday, May 3, 1996," reads a statement posted to O'Connor's Web site. "But none reflect what I believe to be the ultimate value of this domain name. However, this domain remains for sale."

An auction is just one of the ways--and one of the most polite, at that--by which domain names are changing. Other individuals and small businesses that opt for names that sound like brand labels are more often finding themselves embroiled in bitter, costly legal disputes.

Domain names are doled out to individuals and organizations for a $50 annual fee on a "first-come, first-served" basis by the InterNic registration service, an organization run by Network Solutions. The National Science Foundation chose InterNic to administer the names as a not-for-profit collaborative service in 1993.

To protect itself against the rising tide of domain name disputes, Network Solutions last November alterned its registration policy so that an applicant is liable when a domain names infringes on a "trademark, service mark, trade name, company name, or any other intellectual property right."

As of March, there were 274,984 registered domain names ending in .com, the suffix reserved for commercial organizations.

Some observers contend that domain names have become less significant as search engines are used increasingly to locate sites. "Search engines have almost eliminated the name game," said Mike Walsh, president of market research firm Internet Info. "If you have a Web site, there should be enough verbiage on a Web page that a good search engine will pick it up."

But that won't stop the tussles over small organizations registering generic names that evoke recognizable brands.

Last December, Roadrunner, a New Mexico Internet service provider, was notified that it would have to forfeit its domain name to Warner Brothers because the entertainment company wanted an Internet site dedicated to the "Roadrunner" cartoon character.

The ISP says it had no intention of infringing upon Warner Brothers' trademark when it registered the domain name in May of 1994 but chose to fight the studio rather than give up the name. The case is now in court.

"We're named Roadrunner because it's the state bird," said Jane Hill, a manager at the company. "It's not like Coca-Cola. [Roadrunner] is more generic. If we had to go back to our subscribers and tell them we have to change domain names, we'd lose customers. Otherwise, I wouldn't think twice about [giving the name to Warner Brothers]."

In another well-known case, Newsday writer Joshua Quittner successfully registered mcdonalds.com in 1994 before InterNic changed its registration policy. The McDonald's chain later asked for the name back, but unlike Roadrunner, Quittner decided to sell and donated the proceeds to charity.

Increasingly, though, generic names are becoming desirable to companies establishing Internet sites because everyday names are theoretically easier to remember. For example, spaghetti sauce maker Ragu has also registered the domain name eat.com.

Undoubtedly, the legal disputes over domain names will continue as more corporations jump on the Net. A comprehensive list of domain name disputes is available on a site maintained by George Washington University Law School.

Meanwhile, there remains a potentially lucrative business for clever companies that register a familiar name.com.

 

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