Microsoft Quietly Making Untold Millions
Assume for a second that you're among the almost 80% of people that use Internet Explorer to surf the web. You're looking for Lexus Financial Services. You know that their actual domain name is LexusFinancial.com. But for some reason you enter Lexus-Financail.com into your browser bar - and you're in good company, because millions of people mistype domain names every day.
Fire up Internet Explorer and try this right now. Enter Lexus-Financail.com into your address bar and hit enter. (If you're on a different browser, click here to see the results you would get.)
As the domain Lexus-Financail.com doesn't actually exist, Internet Explorer in its default configuration sends you to Live Search, which offers you two related terms: Lexus Financial and Lexus Financial Services.
If you click on either of these links, you're taken to a Live Search Results Page filled with PPC (pay per click) ads:
Click on any of these ads and Microsoft earns anywhere from a few cents to a few dollars, thereby profiting from a typo of Lexus Financial's trademark.
Pretty sneaky! If a domainer were to actually register such a typo domain and profit from it, wouldn't he run the immediate risk of losing the domain and facing expensive lawsuits?
Case in point: The typo domain LexusFinancail.com (same as our example but without the dash) actually exists and is in the process of being taken away from its original registrant by Lexus. Lexus had brought a cybersquatting complaint before the WIPO Arbitration and Mediation Center under ICANN's Uniform Domain Name Dispute Resolution Policy (UDRP).
Under this policy, which was established to resolve domain disputes quickly and inexpensively, a complainant must prove three different elements in order to win the rights to a disputed domain name:
- The disputed domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights.
- The respondent has no right or legitimate interest in respect of the disputed domain name.
- The disputed domain name was registered and is being used in bad faith.
In the case of LexusFinancail.com, the WIPO panelist in charge of the proceedings ruled that the domain fulfilled all three of the above conditions must therefore be transferred to Lexus. The full decision is available here.
From a semantic point of view LexusFinancail.com and Lexus-Financail.com are almost identical. But there is a difference. LexusFinancail.com was registered by a domainer who subsequently lost it to Lexus due to anti-cybersquatting rules. And Lexus-Financail.com will be successfully monetized by Microsoft for as long as it actually doesn't exist.
Top domainer Frank Schilling, who provided the inspiration for this article, has the following to say about the issue:
The real fight for brandholders is recapturing this illgotten traffic from the browsers and ISPs — And that is a much more glaring and simple problem to fix than unseating bajillions of nefarious cybersquatters from typo domains.
Is Microsoft asking for trouble, or is this scheme another demonstration of their evil genius?
The domain Lexus-Financail.com doesn't actually exist. Microsoft automatically and indiscriminately generates results pages filled with PPC ads for a virtually infinite number of non-existent domains. As they don't intentionally pick terms that might infringe on someone's trademark, it's very difficult to accuse them of cybersquatting, at least from a legal point of view. After all, if a company complains about Microsoft profiting from their trademark, Microsoft can simply respond, "If you don't like it, just register the domain!".
By registering the domain, of course, the trademark owner would gain immediate control over it and Microsoft would be off the hook.
To put this in another way, if a domainer profits from a specific domain that potentially resembles a trademark, he is accused of bad faith, relieved of his domain, and quite possibly slapped with a lawsuit. But if Microsoft does this with not just one, but all non-existent domains (a virtually infinite number), it's not bad faith because they aren't specifically targeting a single trademark owner.
Obviously, this wouldn't be Microsoft if they wouldn't also go out and hunt down and sue "cybersquatters" - all the while keeping a straight face.
The Daily Domainer believes that Microsoft will prevail in its quest for typo profits while traditional squatters, who actually have to register typo domains and put their neck on the line in order to profit from them, will increasingly run into problems.
Microsoft is not the only company that has recognized the incredible profits that can be made with this strategy.
Last September, Earthlink started its own program to intercept requests for non-existent domains and redirects them to a customized page filled with ads and alternative search suggestions. Charter got into the game just a few days ago. And Mozilla is leaving millions of dollars on the table by not doing something similar with Firefox.
The prototype of this typosquatting scheme had failed in 2003 when Verisign introduced its so-called "Site Finder" service by redirecting all non-existent domains to a VeriSign search page. The program was met with a public outcry and massive resistance by ISPs, and Verisign was eventually forced to abandon it. But now, less than four years later, the concept is back with a vengeance, and apparently meets with very little opposition.
As early as 1999, a federal judge had ruled that a single year is "several generations, if not an eternity" in Internet time. The lesson for today's tech entrepreneurs? If one of your ideas is not accepted by the marketplace, just try again in a few eternities.
Great article! Who would have thought that Microsoft are some of the most ingenious domainers around and profit from a much more profitable "portfolio" (all domains that don't exist) than most others in the industry.
You are right, there is no outcry and because of that more and more companies will be doing the same.
The data Microsoft collects is worth millions. I'd pay a lot to gain access to their list of most frequently visited unregistered domains.
well, maybe my IE7 is different, but when i put in Lexus-Financail.com i get the standard error page at res://ieframe.dll/dnserror.htm#http://lexus-financail.com/
The guy who owns http://www.mobilephone.com is making millions of dollars a year. Even the country that owns the .cm domain name is making a good fortune (misspelling .com occurs frequently). Soon you will find domain names in a bigger market of its own like Real Estate.
I don't understand. I have set up google as my default search provider in IE7. AND IT DOES THE SAME THING!!!!!!!!!!!!! WHY DON'T YOU BASH GOOGLE.!!!!!!!!!!
It default to the default search provider. If microsoft is your default search provider it goes there. However since mine is google it goes there.
Good theory, bad research…
Yet another reason to use Firefox.
I've tried this in IE7 and it doesnt look like its displaying ads at all. Like the previous comment, just an error page is displayed.
You must use an out-of-the-box installation of IE with all default options intact, as do probably 90%+ of IE users. If you change the default search engine then the results will differ.
Looks like Microsoft is even smarter than we give them credit for.
Oh big deal. I believe that most people don't even use the address bar, they just use google. My in laws have no clue to what the address bar even is.
Now I'll be the first to say that I prefer to get a 404 page over something like this, but I'm also a web developer who NEEDS 404 pages. Most other people out there don't care about 404 pages and would rather be shown that they have probably made a mistake and a tip to help them correct it.
This is a ridiculous article.
The "Live Search" page only appears if you have "Live Search" set up as your default search page. I'll bet most IE users have Google setup as their default search so they get similar results, except it's Google that has "successfully monetized" the non-existent domain name.
Two points.
1. There is no "address bar" as such in IE7. It is a combined address & search bar.
2. I also have Google set as the default search engine for IE7, and it does exactly the same thing. So from our sample of 5 people who mentioned the test we have 3 who use google and 2 who get an error page instead… maybe Microsoft isn't making their silent millions after all! (Google on the other hand…)
Wow, lame article. This is a UX feature. Do you think Grandma wants a DOMAIN NOT FOUND error or a search which quickly gets her to where she wants?!
As many people have said, it's the default search provider and actually if you look at the stats, Google has more pre-set defaults than Live Search at this point in time.
Live Search does a much better job suggesting alternative search terms when you search for a typo domain. With Google, you generally don't get any useful suggestions and therefore no ads. That's probably why Firefox isn't doing this yet.
Stop whining. You're all a bunch of cyber-squatting morons. You shouldn't be surprised that because Microsoft beat you at your game.
tools>internet options>advanced>do not search from the address bar
another good reason to use FF, i think
I've observed that many of my friends does not make a difference between actual url:s and search engine querys. They seem to regard both as "something to enter into the computer to get where you want". Actually they'd probably say it's "something to enter into the internet…" since they don't differ between the browser application and the internet as such either, but that's another story.
They certainly does not make a difference between the browser address bar and a search engine input field. Regardless of any descriptive labels, both are "where you type" to them. Not having any search query they cluelessy enters into the address bar automatically forwarded to a search engine, or vice versa, would just be frustrating to them. They'd say "the computer/internet is broken again" and expect me to fix it, because I "know geek stuff".
While many MS practices certainly are questionable, this is one great, user-friendly feature making the internet more accessible to people who just want their web pages and don't care the least how things work behind the scenes.
Under the circumstances, the best bet is to use Firefox or Opera. Anyway, IE 6.0 has a lot of flaws. More over IE 7.0 is not as widely used as its predecessor.
You could also think seriously in switching over to Linux from Windows if you want to escape the hegemony of Microsoft.
I was expecting more based on the description. If all MS does is send
folks to their search results, that doesn't seem so evil. There are far worse
practices (like google selling page rank to video sponsors) but it's more fun
to bash ms I guess.
http://www.uofl.info
This article is completely mis-leading. All IE is doing is passing you type url to your default search engine (which ofcoarse, by default, is windows live.
Set your search engine to google and it passes the typo url to google. I see this less as a tactic to profit off typo's than a tactic to offer some help to the user in finding what they were looking for.
I hate microsoft with a passion but this article is just using a buzz headline to get people to read it. Tisk Tisk dailydomainer.
This has nothing to do with SiteFinder. The reason there was such a negative response to the SiteFinder-type services is because these operated at the DNS level by LYING to all applications (not just web browsers), telling them that the misspelled domain name they entered really existed, and had a web site at a specific IP address. It's called "the Internet" not "the Interweb". There is more to the Internet than a web browser, and when you change the behavior of DNS for ALL Internet applications simply to effect a user experience change with web browsers, you cause ALL SORTS of problems with e-mail, spam filters, network diagnostic tools, etc. Kudos for remembering the SiteFinder fiasco, but shame on you for failing to understand why the negative response existed in the first place before comparing it to something like IE's search feature.
Microsoft's implementation is entirely implemented in the web browser itself. They do not violate any standards or configure fundamental infrastructure of the Internet to lie about the existence of DNS domains. This is why there is no negative response. The web browser's search feature does not break the functionality of other Internet applications.
Ugh, once again some of the most relevant facts are left out here.
First off, it's prettty clear this is useful functionality. If she misspells a domain name, she'd rather be routed to something showing her what she might be looking for (see the first result in the "oh so evil" screenshots above)… which is the site she's actually going to. She doesn't have to sit and wonder if the cable modem is on the fritz again… it quickly works to help correct her mistake and gives her a one click resolution to get where she wants to go. This is Good Functionality(tm).
Secondly… sure, Live Search is the default. Most software has defaults, and in this case configuration of a default provider is required to enable the Good Functionality(tm) as above.
What you fail to mention is that IE7 makes it very simple to choose whatever default search provider you so desire… it's part of the setup process that fires the first time you load up a new IE7 install. You're presented with a list of the most popular providers, in alphabetical order no less, and you can choose any one as your default with a single click.
AOL, Ask, Google, Yahoo… the gang's all there, and if you want to use any one of them, it's a simple selection which presents you with a dialog box where you can choose to "make this your default". (Nevermind that you won't find Windows Live Search anywhere under the Firefox search provider options)
If you choose Yahoo or Google as your default… bam, lexus-financail.com in the address bar gets you the exact same result… with Google's ads or yahoo's ads right along side.
So, to summarize:
1) Good Functionality(tm)
2) Easy for user to change
Stop with the misinformation already
you have not completely done your homework. you can set up IE7 to whatever default search engine you like. If I type in 'Lexus-Financail.com' I get the following result: http://www.google.com/search?q=Lexus-Financail.com&sourceid=ie7&rls=com.microsoft:en-US&ie=utf8&oe=utf8
This is a google result, not microsoft. So if I click on any of the THOSE links, Google makes money. So what is the difference?? Don't think that microsoft is the only bad guy here.
I'd like to welcome all the Slashdotters who actually know how to change their default search provider.
Here's the point of the article:
Microsoft profits from domain typos. They have optimized Live Search, the default search engine in IE, for maximum revenues by suggesting related search terms for typo domains. Google and Yahoo don't do that. Google provides alternative domain suggestions, which don't generate any PPC ads. And Yahoo simply says that they didn't find any results.
Consider the unlikely trademark typo JPMorrgen.com, which doesn't actually exist. Check out the difference:
Google - Yahoo - Live Search
It's not bad, it's ingenious, and domainers have been doing the same thing (on a smaller scale) for many years by registering domains they believe will attract type-ins and providing relevant ads on the results page.
There's nothing shameful about "quietly making untold profits" - domainers do it all the time. The only thing that could be said against Microsoft is their hypocrisy in going after "cybersquatters" when in fact they are profiting from the very same concept.
For all you Digg Fanboys, this article would not have been dugg had it said… Google quietly making untold millions. It came to Digg front page because it said Microsoft. Digg is awesome, just wish its user base was not filled with 12-14 yr old retards
For quite some time now, I've had my web server configured to redirect all MicroSoft/MSN (including Live) crawler hits back to the bot's own IP address. So…
Example URL: http://www.mysite.com/cool.html
Users and good search bots see cool.html
Microsoft bot at livebot-65-55-213-101.search.live.com has the URL remapped to http://livebot-65-55-213-101.search.live.com/cool.html... if somehow cool.html exists at that site, well, have fun indexing yourself. If not, I suppose in a very very trivial way they're DOSing themselves.
Either way, I dont feel the need to let the bastards index my site.
This article just reinforces my dislike for MicroSoft and confirms my decision to withhold data from them.
IMO, what you describe certainly doesn't make MS a "cybersquatter". There is a big difference between *anticipating* typos and registering domains based on that, and responding to an error. As several people have pointed out already, end users have an option of changing the default response offered by IE. Surely you'll have no objection to the presence of *some* (default) response; it's just that you don't like the default… MS undoubtedly has its flaws, but I don't think they do anything "evil" here! –Unless you object, on principle, to people making any money at all; but I suspect you'd be the first domainer to do so…
This article is amazing. I had registered a few Hotmail typos domains and I received a legal letter from Microsoft that they want £50,000 ($100,000) in damages despite the fact I gave them the domain names as soon as they asked for them. I even offered them all the PPC earnings from the domains - but they want my blood!!! How can they be allowed to make money from typos on a global scale without question? I'm just one small guy - no money for legal teams so I guess i'm going to the High Court shortly!!! Help!!!!
This thing about Typos is Raising Blood Pressure for the Small-Time Domainers..i feel the Fright that this guy (colin) who registered a Hotmail Typo is going thro, and Microsoft wants 100,000 USD..i know someone who OWNS A google typo..can i advise him to drop it or Keep holding on?? But it is unfair to Harass Typo owners for their actions…i mean, where was the Trademark Owner when the Typo was registered!!!
Who cares. You aren't paying !! If companies can't make money then none of us have a job. A waste of data storage this discussion is. People have a right to earn money. It isn't harming anyone.
Good day sir.
Do yu think yu can get in trouble with a google typo with a ccTLD like goggle.cn ?? OR Goggle.ug??
"Do yu think yu can get in trouble with a google typo with a ccTLD like goggle.cn ?? OR Goggle.ug??"
Sorry - I don't know what you are talking about.
Good Day Sir
Colin - I wish you luck. I don't really know the gist of how you make money out of these typos cause I couldn't be bothered reading every post - but as long as you are making some legal money then I feel that you should be able to..
Good Day Sir
This isn't a bad thing really. They use their own PPC ads…so it's just good business to help people… right?!
Feb 28th, 2007 at 12:58 am
[…] du "typo-squatting". Ca paye assez bien. Tellement, même que Microsoft a décidé d'anticiper sur ce point: Quand un tel site n'existe pas, les utilisateurs d'MSIE […]
Feb 28th, 2007 at 4:18 pm
[…] 1st, 2007 Interesting paragraphs from the article on how Microsoft Quietly Making Untold Millions To put this in another way, if a domainer profits from a specific domain that potentially […]
Mar 13th, 2007 at 3:09 pm
[…] domains falls under the "cybersquatting" category. Microsoft is more aggressive and is Quietly Making Untold Millions by diverting typo traffic to their search engine. Increasingly, service providers are offering […]
Mar 14th, 2007 at 7:11 pm
[…] to stomp out typosquatters. Maybe they don't like competition, since they've been profiting themselves from typos. There's a lot of talk about network neutrality these days, and it […]
Mar 15th, 2007 at 9:14 am
[…] the Daily Domainer reported last month, Microsoft is Quietly Making Untold Millions by hijacking non-existent domains, including trademarked domains, to its Live search engine, where […]
Mar 23rd, 2007 at 1:49 pm
[…] just read a something really terrible at DailyDomainer.com. Every time you type in an URL in the address bar in Internet Explorer and misspell the domain name […]
Apr 6th, 2007 at 10:47 am
[…] two parties reached in 2006. VeriSign had earlier sued ICANN over the latter's condemnation of SiteFinder, a controversial VeriSign service that redirected all non-existent domains to advertising […]
Apr 27th, 2007 at 3:48 pm
[…] So who could roll up this field and enter it successfully, who can tap the secret stream of "unwanted" traffic? In order to properly monetize several hundred thousands of ads, you need a broad range and number of active advertisers. As Michael Gilmour points out, AdCenter by Microsoft would be a candidate, but while I hear rumors that they are running trials with selected domain owners, they generally seem to not to want to associate with the domain investment industry. They'd rather monetize typo traffic via their IE default search page. […]
May 23rd, 2007 at 4:15 pm
[…] * Funding ICANN, "Shawdow TLDs" and the Next Domain Name You Really Want to Buy * Microsoft Quietly Making Untold Millions Sphere […]
Jul 18th, 2007 at 1:09 pm
[…] Microsoft Quietly Making Untold Millions » Daily Domainer … response; it's just that you don't like the default… MS undoubtedly has its flaws, but I don't think they do anything "evil" here! –Unless you object, on principle, to people making any money at … http://www.dailydomainer.com/200784-microsoft-quietly-making-untold-millions.html […]
Jul 23rd, 2007 at 9:31 pm
[…] Microsoft Quietly Making Untold Millions » Daily Domainer … real fight for brandholders is recapturing this illgotten traffic … Under the circumstances, the best bet is to use Firefox or Opera … domain name they entered really existed, and had a web site at a … http://www.dailydomainer.com/200784-microsoft-quietly-making-untold-millions.html […]
Oct 28th, 2007 at 10:27 pm
[…] the Internet's burn-down real estate. Unlike browser error-search, Microsoft is incapable of taking that real estate for free via their browser… doo doo doo doo doo do do do — Okay, Rod Serling is rolling over […]
Nov 14th, 2007 at 11:13 am
[…] – Browser manufacturer skimming when users mistype YouDomainName.dom (look at the 'd' and 'c' on you keyboard […]
Nov 16th, 2007 at 12:33 pm
[…] domain names than it is to pursue an action related to ill-gotten error traffic taken via ISP or Browser. That will be a story for another day. If anything, this serves as a harbinger of things to […]
Nov 24th, 2007 at 6:42 pm
[…] go to a website, there is genuine confusion about where or how. It's no surprise to me that a thriving sub-economy exists based on navigational searches - which I define loosely as "typing a web […]
Feb 7th, 2008 at 12:38 pm
[…] interesting, although a year old, is this article that talks about how Microsoft's IE takes your typo entered into the search bar, responds by […]
Feb 11th, 2008 at 10:28 am
[…] Microsoft quietly making untold millions. […]