|Registrar accepts payment for domain backorder then auctions domain|
If the backorder is conditional should payment also be conditional?
I back-ordered a domain name from a well known registrar.
I got an email today saying the domain had been put up for auction on the registrar's domain name auction site.
I was pretty suprised that I hadn't recieved notice that the domain had been re-registered by the owner and was further suprised when the owner had not put a minimum on the auction.
I thought this was a bit fishy so I phoned the registrar and was told that the previous owner had indeed put the domain name up for auction.
After thinking about this a bit more, I was increasingly suspicious that the registrar had actually put the domain up for auction so I phoned back and was again re-assured that it was the previous owner. I asked the customer service rep to check again and was told that actually the registrar had put it up for auction.
So in essence the domain was snatched from me by the registrar despite the fact that I had purchased the back-ordering product from them!
I asked to speak to a supervisor to ask why it didn't say this was going to happen when I purchased the back-ordering product. The reply was that it would have said that if the supervisor ran the company, but they didn't.
I told him I thought it was a bit dodgy doing this as lots of people probably purchased the back-ordering product thinking they would get the name if it expired. He said that GoDaddy owns all domain names they register for people once they expire and they auction them off to make as much money as possible even if they have been back-ordered.
Anyone else had any experience of this?
I personally have attempted to back order one domain, but the person who owned it renewed. Otherwise I stay away from back ordering, because I sense that the Domain Registrars will buy it for themselves.
In your case, I am not surprised this happened, as I am not sure if this type of practice is not regulated. Now that I am writing this post I realize its a great lead generation tool for the Registrars as they now know the desired domain names.
I think the market for domain registration has become so competitive that it may no longer be possible to make money at it honestly.
When threads like this proliferate who will waste money on backorders? Registrars will be forced to dream up even more creative frauds.
cpnmm, hope you don't mind but I edited the subject line of your post to more clearly reflect the issue. Frankly, I agree with your sentiment that something is not quite right and hope I have captured the essence of that sentiment in the rewriting of the thread's title.
I'd invite you, in this case, to post up the "terms and conditions" that accompanied the backorder that you paid for.
Did the terms and conditions spell out this scenario?
I agree that, if the T&C didn't plainly (bold letters) spell out that a backorder on a domain registered "locally" would not be capable of capture by backorder then your money was taken in something less than squeaky clean good faith.
It seems to me that the backorder system ought to have been programmed to first check if the domain was a registrar controlled domain and "if yes then" the system should have refused to accept payment and instead directed you to participate in the auction.
I'd invite anyone from GoDaddy to explain why their system cannot - or ought not - be programmed to reject payment for domains that are locally registered and therefore subject to automatic transfer into the auction system. At the very least, before "final action of registration/payment" is taken by the person placing the backorder a pop-up or other page ought to appear confirming that the domain backorder will not be honored if the domain is locally registered and will, instead, be subject to auction only.
Seems only fair. Is this what is being done? Did the originator of this thread receive such "benefit of registration process" or, was the information, imbedded somewhere in the 1,2 or 3 TOS/agreements that accompanied the backorder process?
[edited by: Webwork at 4:44 pm (utc) on Nov. 20, 2005]
Thanks for the opportunity to explain in detail Webwork. I think that others thinking about purchasing this product should be aware that their system will automatically auction off a domain you have back-ordered.
Here's the page where they describe the product:
|If a name you want is already registered you can still own it. But don't leave anything to chance! Secure your chance to snap it up the INSTANT it expires! |
# Includes FREE DomainAlert Pro Monitoring for backordered domain! Additional monitoring packs available (see left).
# Includes the cost of registering the domain name and ICANN Fee, so you can have the domain instantly.
# If you don't get the name, you don't lose money: You can re-assign your backorder fee to another name until you capture one.
# NEW! Includes Complete Email with each backorder! You'll get your own personalized email address (essential for small businesses) and 25MB total storage, absolutely FREE! ($9.95/yr value)
# NEW! Includes FREE membership to The Domain Name Aftermarket, the 'Net's hot new place to buy, sell or find a previously registered
Here's what you get when you click on 'tell me more':
|What is Domain Name Backordering? |
Backorder this name and we will ATTEMPT to grab and register it on your behalf, if and when it expires and becomes available.
Your low $18.95 backorder cost includes the registration fee, ICANN Fee, plus automatic monitoring and email alerts on changes to the Registrar, Status, Expiration Date, and Name Servers. Your domain backorder fee can be re-assigned to other names as often as you like, until you are successful in acquiring a domain name.
If the name you are interested in has gone to auction at The Domain Name Aftermarket, the $18.95 cost will be used to place the opening bid on the name. If no other bids are placed, the domain will be awarded to you subject to the rights of the previous domain holder. If another bid is received on the name, you will receive an outbid notice and can raise your bid on the name or move the backorder to another name.
You also have the option of making your backorder private -- which means your personal identifying information (name, phone number, email and home addresses) is shielded from public exposure in the WHOIS directory from the very moment the backordered domain is successfully acquired.
Please understand that a backorder does not guarantee you the domain name being backordered. The domain name may be renewed by its current owner and not become available or we may be unsuccessful in our attempts to grab it and register it on your behalf.
Again, if your backorder is not successful, it can be reassigned to another domain name. (And if your unsuccessful backorder is private, your private registration can be applied to any other backorder).
I personally don't think this makes it clear that any godaddy domain will automatically be auctioned off, even if you have back-ordered it.
I have also complained this week for the exact same reason. The Terms do say that
"If the name you are interested in has gone to auction at The Domain Name Aftermarket, the $18.95 cost will be used to place the opening bid on the name."
...but there is no indication that it will go to auction or what the auction is about or who "The Domain Name Aftermarket" actually is. Furthermore, my understanding is that you have to pay an extra $4.95 to bid on the domain that was backordered.
So, basically, you backorder a domain, they put it up for auction as it now belongs to them and the response from the company is "thank you for your comments..blah..blah...blah...it will be passed on..blah...blah...blah."
From a company that I've always had time for this is very poor form.
|If the name you are interested in has gone to auction |
Where, if anywhere, does GoDaddy explain to a person purchasing a backorder, the circumstances under which a backordered domain "will escape" the backorder system and instead go to auction?
It seems to me that absent such clarification you are paying money to engage in a "bean under the cup" game: If you want to win all you need to do is guess which cup the bean is under after they are shuffled around.
It seems to me that a consumer that puts up their $18.95 ought to know, in the clearest terms, the circumstances under which their $18.95 doesn't - in fact - entitle them to a claim to the domain by backorder process alone.
Who decides and how do they decide what domains will go to auction? Is this known when they take someone's money for a backorder? Is this information disclosed?
Should they even be taking backorder money until a determination is made whether the domain will go do auction?
Do they make a determination to backorder based upon the number of backorder attempts, that is, an expression of interest in the domain?
It seems that GoDaddy presumes that you are interested in - and have the resources to participate in - an auction process. That is likely quite wrong in a number of cases. Not everyone who has $18.95 has the wherewithal to engage in competitive bidding.
I invite GoDaddy to explain their rationale and exactly why this is fair to consumers absent a more detailed disclosure regarding the mechanics of the process whereby a domain that is subject to backorder is also subject to auction.
Let me reaffirm this: This board is not about bashing any company or addressing personal grievances with any company. However, in this case, since the registration procedure and backorder policy appears to apply to all consumers, I think it's an issue worthy of a focused discusssion on this issue alone.
Please stay on topic and please keep the posts to facts, not statements of annoyance, etc.
Having only used this service once, I can't say that this is general procedure but it appears that when the domain is backordered and the owner doesn't renew then the domain will go up for auction, maybe that's the "get out" clause here for the condition of going to auction.
If that is the case then it appears to me to be just a tad more than misleading. I really don't see what $18.95 payment is for other than alerting the company to the fact that there is a domain available that somebody is interested in purchasing.
This is standard operating proceedure for GoDaddy. They changed to this method somewhere around May this year. I remember seeing a notice to that effect from them. To paraphrase...
1) You place a back order
2) The domain expires
3) They place the domain for auction on The Domain Name Aftermarket
4) They transfer your back order payment as the first bid
5) If you don't win the auction then you can use the money on another back order
Basically rendering back ordering useless (as we all know already).
<edit>Err.. I haven't actually experienced this personally just going from memory of the notice</edit>
I was a victim of this also, they also refuse a refund.
[edited by: Webwork at 6:19 am (utc) on Nov. 21, 2005]
[edit reason] See message #8 above [/edit]
Hi, after a couple of emails with GoDaddy's 'Office of the President', I was sent a direct link to the terms where they mention that "The domain name may also be placed in a secondary market for resale through The Domain Name Aftermarket service.". Not particularly clear but could be taken to mean they have the right to auction the domain name.
I didn't remember reading this when I bought the product so I went though the purchasing steps again to try and find it. I did after about 20 minutes. To find the legal agreement:
1. At the check-out screen (after you have selected 'Buy Now' and gone through the other additional products they try and sell you) click on 'Universal Terms of Service'.
2. The 'Universal Terms of Service' makes no mention that the domain will be auctioned but there is a link to 'Back-Ordering and Monitoring Agreement' after scrolling right down to the bottom of the document.
3. A document then appears in a pop-up window. This document also makes no mention that the domain will be auctioned off but does contains this:
|This Go Daddy Software, Inc. Domain Name Back Ordering and Monitoring Agreement ("Agreement") is by and between Go Daddy Software, Inc. , an Arizona corporation (" Go Daddy "), and you, your heirs, agents, successors and assigns ("You"), and is made effective as of the date of electronic execution. This Agreement sets forth the terms and conditions of Your use of Go Daddy 's Domain Name Back Ordering and Monitoring Services (the "Services") and represents the entire agreement between You and Go Daddy By using the Services, You acknowledge that You have read, understand and agree to be bound by all the terms and conditions of this Agreement, along with any new, different or additional terms, conditions or policies including the Universal Terms of Service which Go Daddy may establish from time to time. Such Agreements may be found here. |
4. Clicking on the word 'here' at the end of the paragraph takes to you another pop-up window and scrolling down you find a list of links amoungst which is 'Back Ordering and Monitoring Agreement'. Although this has the same title, it is a different document to the 'Back Ordering and Monitoring Agreement' mentioned earlier.
5. Clicking this link opens yet another pop up window - you'll have five windows open by now. This document is the one that contains 'The domain name may also be placed in a secondary market for resale through The Domain Name Aftermarket service.' in the middle of the second paragraph.
So there you go. Make sure you spend a good half an hour reading all the fine print when you purchase anything from GoDaddy!
I think its the most wackiest thing if seen, you have to pay for something so you might have the opputunity to pay more, but could of payed less if you skipped the first part. Very elitist sales attitude.
Back ordering today is allmost like buying a lottery ticket.
The last company I backordered one gave me a nice service of sending me a weekly email about the status of the domain.
Each email said that was no change in the status of the domain, even AFTER the domain had been renewed. As a value added service, I still get the same email each week.
However, in all fairness, I could have them provide this same service on a new domain.
Nice game isn't it?
It sounds like GoDaddy's system is set up so they get paid no matter what. That's not per se bad, so long as it's clear what you're buying: A conditional backorder that defaults to an auction if there's more than 1 interested party (presumably it's multiple backorder attempts that triggers an auction).
Here's what I think would be fair: If GoDaddy knows that the domain is their's to assign on the drop (it's locally registered) then GoDaddy ought not take backorder money IF there's any chance the domain will go to auction.
Instead, GoDaddy should add the person's name to an auction notification list - without charge - AND IF that person is the only one signed up for the aution then GoDaddy can charge their credit card $18.95 for "winning the auction".
If there are multiple interested parties then only those who actually bid bet to play and pay, and the minimum charge will be $18.95.
IF no one who "signs up" for the auction actually bids at the auction then the first person who signed up for the auction IS charged $18.95 and gets the domain.
Spell it out, just like above, then add all the other legalese.
Charging someone for a backorder that's not really a backorder - which fact, as the member stated is buried deep in the online T&C - simply doesn't get past my fairness meter. Instead, it reminds me of the radio and TV ads about car sales where - after the big "come on down" - the nitty gritty details (there's only 1 car at the sale price) are disclosed.
It's easy to blame it on the lawyers but no one ever forced a businessman to not speak plainly if they choose to. Get the details that matter to the consumer up front and in bold and then CYA with the necessary legalese (jurisdiction, etc.).