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Domain database sale--marketers delight, privacy nightmare?
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THE Internet's phone book is up for sale -- and though the listings may represent a treasure trove for marketers, the move also risks a serious privacy backlash.
At issue are millions of entries in the domain-name database operated by the Network Solutions unit of VeriSign. It is, essentially, the master address book for the Internet. Since the dawn of commerce on the Web, companies that want their own dot-com addresses have registered with Network Solutions.
Now Network Solutions is selling that information: "Available for the first time ever. Approximately six million unique customers, sliced and diced for you to target prospects, learn about a specific audience or retain customers. Take this information and run with it."
Exactly what's for sale may come as a surprise to many of the individuals and businesses who have registered Web addresses. In addition to names, street addresses, and other routine information gathered when someone signs up for a domain name, Network Solutions promises marketers information on whether sites are dormant or up and running, whether they're set up for e-commerce -- even whether a site has security precautions installed.
The move underscores the growing pressure on Internet companies to find new sources of revenue. Now that the Net boom has slowed, many dot-com companies view customer databases as a tempting asset.
But such strategies can be perilous given consumer concerns about privacy online. Last year, online-ad concern DoubleClick Inc was forced to back off a plan to combine Web-tracking data with offline databases after the move triggered a firestorm. And when online retailer Toysmart.com shut down in May, a plan to sell its customer database provoked a similar controversy. Walt Disney Co, a Toysmart investor, offered to purchase and then destroy the data after the Federal Trade Commission moved to block Toysmart's plan.
The Network Solutions database is a key part of the Internet's infrastructure. Internet computers rely on numerical addresses to route information around. When someone registers a domain name, the information is used to tell computers all over the Internet how to translate that dot-com address into the appropriate numerical address.
Registrants must provide the name, telephone number and e-mail address of a technical contact for their site -- information that can prove vital for someone trying to trace a hacker's attack or verify whether an online business is legitimate.
Network Solutions is required by the US Government to provide public access to the data. Anyone can visit the Network Solutions site and look up information on Web addresses one by one. And indeed, some marketers -- especially those sending unsolicited e-mail--have laboriously harvested information this way.
For marketing purposes, it's much more useful to have a complete set of data outright. Network Solutions offers marketers this option--for a price and under its guidelines, which includes stripping out e-mail addresses and forbidding the use of the information for e-mail marketing.
While downplaying any privacy concerns, Network Solutions is telling marketers that its data are a great way to sell things, especially where small businesses are concerned. "Nobody offers a better snapshot of this hard-to-reach group, over 80 per cent of our customers are small businesses, representing every major small business category you could hope to reach," proclaims an information page at www.dotcom.com, the site Network Solutions uses to promote its data business.
But how does it know whether a site is up and running, or whether it is engaged in e-commerce, or any of the other pieces of information that it is promising to sell to marketers? Wolford, general manager for Web presence at VeriSign, says the company sends software "robots" out onto the Web, using much the same method that search engines use to catalog sites. Those robots can look for key phrases such as "online ordering" or "credit cards accepted" to determine whether a site has e-commerce.
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