Australians setting up in business with what they think is the perfect company name, are increasingly finding when they come to register it as a domain name that they don’t necessarily have the rights to it.

It’s often a branding issue, with an organisation’s name sometimes being one of its most significant assets, explained Michael Park, a technology lawyer at Deacons, and president of the NSW Society for Computers and the Law.

“Obviously, as organisations become more successful and develop particular branding strategies its name becomes more important,” Park said. “Branding on the Internet is an extension of traditional branding strategies, particularly for technology-based organisations or organisations that rely on the Internet as a source of revenue.”

There have been various attempts to deal with issues surrounding an organisation or person’s rights to a domain name.

With a target implementation date of August 1, .au Domain Administration (auDA) is planning to introduce its new .au Dispute Resolution Policy (auDRP). The idea is to provide a cheaper, speedier alternative to litigation for the resolution of disputes between a registrant of a .au domain name and a party which believes it has competing rights in the domain name, according to auDA’s Web site.

The auDRP is an adaption of the Internet Corporation for Assigned Names and Numbers (ICANN) uniform dispute resolution policy for global gTLDs (global top level domains).

According to auDA’s Web site, because the existing domain name licences will be grandfathered registrants which have licensed domain names before the introduction of the new dispute resolution policy, they won’t have to submit to a proceeding under auDRP unless they sign on to the process. “However, upon renewing their domain name, registrants will be required to sign on to the auDRP as part of their domain name licence agreement,” it states.

John Brand, senior program director of electronic business strategies at market analysts META Group, said the whole domain space was largely over-rated initially. “We saw a lot of hype over the registering of specific names,” Brand said. He uses the example of speculators who potentially tried to hold organisations to ransom.

Brand believes what we’re now seeing is domain names becoming less effective as a primary branding mechanism for a company. “They’re certainly letting their multiple domain names lapse – we’re seeing a trend where the number of lapsed registrations is now exceeding the number of new registrations.”

Brand sees domain names being registered to four primary user groups – speculators, optimists, operators and egotists.

“Because the domain name system was designed right from the start as quite an egalitarian system, the speculators came in and purchased sometimes huge volumes of Internet properties on the basis that they could onsell the domains at wildly inflated prices,” Brand said.

Brand said there were some good examples of organisations paying huge sums of money to get access to their preferred domain name, that someone else had bought for a few hundred dollars. But he doesn’t see that as much of an issue as it used to be. “Now that organisations have recognised that there’s more to their online branding than just a domain name these speculators have a drastically shrinking market,” Brand argued.

Brand described the operator segment of what he considers to be the four primary user groups as public, private and governmental organisations which have a real reason to register a name to deliver content and services via the Web. “In many cases they attempted to protect themselves by registering names that might also be used against them at some stage by disgruntled ex-employees, customers or even competitors.”

He believes this was very much a “land grab”-based on the philosophy of whatever an organisation could own couldn’t be used against it. “In most cases organisations discovered that simply owning the domain name did not stop untoward discussion or behaviour, in which case the domain name registered was of little value or protection,” he said.

However, Brand sees search engine technologies as allowing users to find the right information, rather than looking for a single point of entry to a Web site.

For a word to be a trademark it has to be distinctive, explained Philip Argy, senior technology partner of communications and intellectual property at law firm Mallesons Stephen Jaques.

Argy believes that many Australians are still befuddled by the area of domain names. “The test then of whether a domain name is going to give rights to litigation depends on what other functions a domain name is performing,” he said, using the example of whether a domain name picks up a secondary meaning for a company. “If you use a word that is someone’s trademark, the likely effect is they’ll sue you to get their trademark back.”