Hosting.com, Inc., a managed hosting and colocation services company, today announced that it is launching a six to twelve month comprehensive study into the issue of pay-per-click (PPC) fraud through its Hosting.com Labs division.

The company says that its Labs is designed to research some of the complex Internet challenges of the day and forward to its constituents’ knowledge and information that may springboard development of new products and services.

In recent months, the practice has been getting increased media attention as large search engines such as Google and Yahoo have been battling lawsuits with customers claiming that they were overcharged for fraudulent clicks. Hosting.com is currently accepting participants interested in being a part of its PPC fraud study.

“Being a victim of click fraud ourselves as well as our clients, we began to study the issue a few years ago. We have applied our tremendous knowledge and expertise regarding Internet infrastructure and networking, security, and web user behavior to develop a sophisticated data collection system that will assist us greatly in our analysis of this problem, and assist our thousands of clients who spend significantly on PPC advertising,” said Darren G. King, President and CEO of Hosting.com.

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Register.com, a provider of domain name registration and Internet services, yesterday announced the sale of its Corporate Services Division to Corporation Service Company, a privately-held firm and provider of financial and legal services to corporations and law firms.

Register.com’s Corporate Services Division provides online brand protection to large corporations with domain name portfolios. It also provides strategy consulting services and global domain name registrations, management and monitoring services. The company will now focus its management and financial resources on the domain name registration and web-based services needs of small- and medium-sized businesses, and individual consumers.

“Helping our customers unleash the true potential of their business through the power of the Internet is Register.com’s number one priority,” said David Moore, CEO of Register.com. “Today’s announcement puts a fine point on our mission to be the go-to provider of web-based value added services and award-winning customer service to our core market–millions of small- and medium-sized businesses looking to harness their online potential. We’re looking forward to channeling our efforts to better serve this market.”

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Google Inc., which runs the largest ad network on the Internet, is making millions of dollars a year by filling otherwise unused Web sites with ads. In many instances, these ad-filled pages appear when users mistype an Internet address, such as “BistBuy.com.”

This new form of advertising is turning into a booming business that some say is cluttering the Internet and could be violating trademark rules. It also has sparked a speculative frenzy of investment in domain names, pushing the value of some beyond the $1 million mark.

Google specifically bars Web addresses that infringe on trademarks from using its ad network, but a review of placeholder Web sites that result from misspelled domain names of well-known companies found that many of the ads on those pages come directly from Google.

“It seems very hard to reconcile Google’s support of this activity with their ‘Do No Evil’ motto,” said Ben Edelman, a Harvard University researcher who has looked extensively into advertising on unused domains.

Google is defending its business practices, saying that it removes participating sites from its ad network if a trademark owner complains that those sites are confusingly similar — even though close misspellings don’t necessarily prove that a legal infringement has occurred.

“Unless it is confusing to somebody, trademark law doesn’t apply,” said Rose Hagan, Google’s chief trademark lawyer.

The Silicon Valley search giant is the largest but not the only ad network showing ads on placeholder Web pages. Yahoo and Australian firm Dark Blue Sea run similar services.

This form of online advertising relies on “type-in traffic”: users who type the information they’re looking for directly into the Web browser’s address bar instead of using a search engine to scour the Web. Industry analysts estimate that 15 percent of all Web traffic originates this way.

That has created a demand for a practice known as domain parking, which involves owners of a domain name “parking” that name with a firm that creates placeholder pages and then inviting Google or other Internet ad networks to fill them with ads. When Web surfers arrive at those sites and click on those ads, Google and Yahoo get paid by advertisers for that click and share their revenue with the owners of the domain names.

Opinion is divided on these type of ad pages. Some say they are nothing more than frustrating junk pages. Others, including those who speculate on potential traffic of a specific domain name, say they help people find information related to what they’re looking for.

“We want those pages to function as alternatives to search engines,” said Matthew Bentley, chief strategy officer for Sedo, a large parking service that manages more than 1 million unused addresses placed with the Google ad network.

The parked ad pages are mostly unattractive, but Sedo, Google and Yahoo have all said that they are working to improve them by adding more information. The parking service usually handles the creation of the ad sites.

“It’s such an easy process,” said Ron Jackson, publisher of DNJournal.com, an online publication that covers the industry. “In two minutes, I can set up a thousand domain names.”

The practice has sparked a speculative scramble to register unused names and test their ad potential. Because purchasers can change their minds within five days and avoid paying the $6 registration fee for the name, many investors enter the names in Google’s ad program for a quick test and quickly drop those that don’t yield enough clicks to cover the domain registration fee.

Of the 30 million dot-com names registered worldwide last month, more than 90 percent were dropped, according to domain name registrar GoDaddy.com. As a whole, the Internet has only 54 million active .com and .net addresses, according to VeriSign Inc.

Jackson said he has bought 6,600 domains and uses several different ad services to earn revenue on them. “I know quite a few guys making over a million dollars a year from advertising on their domains,” he said. “It’s like a 24-hour money-printing machine.”

David Steele, an intellectual property lawyer at Christie, Parker & Hale and a professor at Loyola Law School in Los Angeles, said the practice amounts to someone making money off someone else’s trademark without permission.

“Trademark law is designed to protect consumers so they can quickly identify what they want and get it,” Steele said. “If everyone has to spend a whole bunch of time wading through all this lookalike crap online, then the value for Internet consumers is going to be seriously reduced.”

John Meyers, general manager of Yahoo’s ad service for parked domains, said Yahoo is strict about weeding out addresses that violate its guidelines, which prohibit celebrity names, typos of trademarks and references to illegal activity. Yahoo developed a software filter to identify domain names in its network that violate those rules so they can be removed.

But Hagan, Google’s trademark lawyer, said that software formulas aren’t smart enough to identify trademark infringements.

“It’s subjective when you look at domain names to decide how many letters off does it have to be to form a trademark or conjure up that trademark,” she said.

Google won’t disclose how much revenue it is earning from ads on these types of sites, but Chief Executive Eric Schmidt said in an interview last week, “It’s a lot of money.”

The company also doesn’t break out how much money it earns from showing ads on its own sites compared to partner sites, which include rival search engines such as Ask.com, thousands of news sites and blogs, and millions of vacant domains. Wall Street analysts, however, estimate a little less than half of Google’s $6 billion in revenue last year came from ads shown on partner sites.

The Washington Post, using a software tool created by the Microsoft Research division, found hundreds of active Web sites showing Google ads at addresses that appear to be misspelled variations of well-known company names, known as “typo-domains.” Their owners are known as “typosquatters.”

The Post generated roughly 100 random misspellings of ” www.earthlink.net” and found 38 sites using variations of the Earthlink name “parked” at a Google-owned service called Oingo.com. All 38, which includes “dearthlink.net” and “rearthlink.net,” serve Google ads.

Likewise, nearly a dozen sites with variations of “Verizon Wireless” were showing Google ads, with some linked to the company’s official VerizonWireless.com. That suggests Verizon Wireless may be paying Google for ads on typosquatter-owned sites.

Verizon Wireless spokesman John Johnson said the company has a successful track record of getting such sites shut down and takes “a particularly dim view of typosquatters.”

“Do we think any traffic is good traffic as long as it ends up at our site? Clearly many of these sites are siphoning off traffic by tricking people who have tried to obtain information about Verizon Wireless,” Johnson said. “This is never a good thing for our trademark or our company, and it’s certainly not a good thing for customers trying to reach us on the Web.”

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BELLEVUE, Wash.–(BUSINESS WIRE)–May 1, 2006–eNom, Inc. (www.enom.com), one of the world’s largest Internet domain name registrars, announced that it has been acquired by Demand Media, Inc., a new company headed by former MySpace.com chairman, and former CEO of Intermix Media, Richard Rosenblatt. Los Angeles-based Demand Media will broaden eNom’s offerings by developing proprietary content tools and technologies, as well as new online advertising opportunities for eNom’s clients.

With the acquisition, Paul Stahura, eNom founder and CEO, becomes president and chief operating officer of Demand Media. Terms of the private sale were not disclosed.

“For eNom’s valued network of resellers and retail customers, the acquisition represents no changes to existing relationships,” assured Stahura. “We will continue to offer domain name and related services under the eNom brand, which is one of the strongest in the domain-name business. eNom’s resellers can be confident that the company will continue to build and enhance its infrastructure, enabling eNom to offer an even more robust suite of services.”

“Media companies and advertising networks are now recognizing the central role a domain name plays in bringing users to Internet properties,” added Stahura. “The added capital from Demand Media will accelerate our commitment to grow our business as an ICANN-accredited domain name registrar and provider of high-quality value added services.”

Demand Media, Inc’s Chairman and CEO Richard Rosenblatt, described by the Wall Street Journal as a “serial Internet entrepreneur,” ran MySpace.com’s parent company, Intermix Media Inc., and negotiated its sale to News Corp. for more than $650 million last year. Richard was also the founding investor and vice-chairman of Great Domains, as well as Chairman and CEO of iMALL, Inc. In addition to eNom, Inc., Demand Media, Inc. also purchased San Francisco-based eHow Inc., which provides niche content for websites.

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A new bank phishing scam is on the loose with the scammer using a genuine registered top order domain name to entice people to believe that it is a real bank.

Using the domain, www.commonwealth-security.com, sophisticated scammers are using the well worn method of trying to get people to visit their site under the guise of being from the Commonwealth Bank of Australia and asking people to update their details. The level of sophistication of this phishing attempt, however, is such that the scammers are using a top level registered domain name. The scam site can be traced back to www.comcast.net, which is probably the unwitting host.

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All Fasthosts shared hosting packages now come with a free blogging tool, so you can create a simple online journal to collect all your thoughts, opinions and news on a web page you can share with everyone!

With the Fasthosts blogging tool you can post text articles, photos and images on a vibrant, attractive web page within minutes and without the need for any HTML or FTP… you just need to type and post!

Great as a stand-alone website or as an extension of a full website, blogging has now been included with all Home, Developer and Business shared hosting packages – as well as the hosting packages of all existing customers.

With shared hosting packages now starting at only £3.99 / month and boasting more features than ever, there’s never been a better time to realise your online potential with Fasthosts.

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