MANY Organisations are risking Their reputations and revenue by not sufficiently protecting Internet domain names. The recent announcement of more domain name extensions being made available will surely exacerbate the problem still further.
Domain names should be considered a major part of a company’s intellectual property, and be afforded the same importance as a trademark – but this simply isn’t the case.
Though most companies are now wising up to the importance of having an identity on the World Wide Web, many are not taking significant precautions to secure or protect this identity. As such, they are creating manifold problems for their brand in the years ahead.
Counterfeits, defamatory sites and so-called ‘cyber-squatting’ have been afforded much publicity in the past, but the vexed issue of managing intellectual property on the Internet is far more complex.
The sheer size and global reach of the Internet means that one particular problem looks set to increase. We’re talking about the conflict between companies with similar names operating in similar areas – and, therefore, requiring similar domain names. This is in spite of the fact that more top-level domains have been made available to web consumers.
In fact, the release of more domain extensions compounds the problem. The new extensions are added to enable like-named companies to have domain names that are distinguishable. However, this can increase the dilution of identity, and ultimately risks the loss of potential customers to like-named sites.
Expectation of potential customers trying to locate a web site is the first issue. If they do not find the site immediately at the address where they would assume it to be located, or are confused by the sites of other like-named products or organisations, the brand’s identity is both immediately diluted and compromised. There is also, of course, the danger of loss of revenue if customers are diverted to other sites.
The globalisation of the Internet compounds these problems. For example, two like-named book retailers could have been trading for years – one in the UK and one in the US – without any conflict. With the introduction of web sites, they are immediately in competition for eachother’s domain names and customers.
Rights to the ownership of domain names is an immensely convoluted and potentially costly business. In some cases, companies can automatically own a trademark under common law without registering it. That said, this is not the case with domain names, which are allocated on a ‘first-come, first-served’ basis.
This is not a hard and fast rule, however.
In a legal contest, where both parties have registered trademarks, the domain name would probably be given to the organisation that registered earliest.
Controversially, current regulations tend to favour the ‘big guys’ over the small, as ownership would commonly be granted to those who can prove they have invested most in the brand name. Often, though, this is difficult to determine.
Let’s look again at the two book companies. They might well be of a similar size, and have been trading for a similar length of time – but if one can prove that the other is causing it commercial problems, this would have a bearing on who was given ultimate rights to the name. Both parties, though, could potentially argue they were losing business to the other.
Bearing in mind such a legal and ethical minefield, it clearly pays to take as many precautions as possible – and to be pro-active.
One of the main things companies must do is to make sure they have a strong brand identity, and that this is immediately evident on the first page of the web site. Browsers can then see immediately who a company is, and what they’re all about. There should be absolutely no deviation – logos (and their positioning) should be uniform, and colours and typeface must always be totally consistent.
As a precaution, product names must be registered as well as the brand. If new products are in development, it’s important that a check is made to ensure that a domain using a given name has not already been registered.
Again, this process is far from simple. Since trademarks and brand names can be legally protected under common law (even if they’re not registered), a domain name might be available at present but there could be someone out there with a prior claim to it, who could come along and prove their rights to ownership in the future. To prevent this, our company is often asked to conduct common law searches on the Internet.
One of the latest controversies that has not yet been tested in the courts is attempting to gain traffic to a site by loading the first page with references to a relevant big brand name which is then picked up by the search engines.
Also, some brand owners infrequently monitor the Internet (including their own site). Companies are quick to protect their (physical) premises by installing some sort of security system, so why shouldn’t they afford the same consideration when it comes to a web site?
Nobody disputes the fact that the Internet poses incredible opportunities for businesses now and in the future. Seen in this light, it’s important that companies harness the medium – treating it with as much respect and importance as other aspects of their intellectual property.
