HERNDON, VA – Domain registrar Network Solutions Inc. last week first denied and then admitted it engages in a practice known as “front-running” domain names users have researched on its website.Front-running arises from an artifact in the registration process that allows people to register domains that were not purchased immediately after they were searched on a registrar’s website. In some cases, the buyers hope to sell the domains to the original searcher at a higher rate than he would have paid had he registered it immediately. In most cases it’s more a virtual “gotcha” than cybersquatting in the strictest sense, but front-running can be used for profit. Many cybercitizens consider the practice unethical and say it should be outlawed.

Front-running is closely related to “domain tasting,” a “try before you buy” registration plan instituted last year by the Internet Corporation for Assigned Names and Numbers. Tasting allows registrants to purchase a domain name, try it out for up to five days and then return it and receive a refund if the domain does not meet expectations. Tasting is popular with “domainers,” or those who monetize undeveloped URLS by circulating traffic through them or buying, selling and trading them for profit.

As NSI employs front-running, domains that are searched but not purchased immediately are held “in reserve” for four days, during which time the name appears taken when users search for it on other registrars’ sites. Instead of the standard “this name is taken” message, however, users encounter a message indicating the domain name is available exclusively through Network Solutions.

According to a post at Slashdot.org, ICANN considers front-running unethical but not illegal, but contracts between the agency and domain registrars don’t specifically prohibit the practice. In a recent study about front-running, the Web’s regulatory body noted “ICANN’s Registrar Accreditation Agreement and Registry Agreements do not expressly prohibit registrars and registries from monitoring and collecting WHOIS query or domain name availability query data and either selling this information or using it directly.”

News of NSI’s controversial behavior began circulating about January 1st, despite the company’s apparent efforts to keep it quiet. According to PC World, without notice to consumers, NSI began testing the feature in December before committing to it during the first weekend in January.

Critics call the practice extortion because it forces registrants to become NSI clients instead of registering domains at possibly much lower rates through NSI’s competitors.

On Wednesday, NSI sent a statement to internet infrastructure and policy community CircleID in which Vice President of Policy Jonathon Nevett provided a somewhat circular explanation: NSI front-runs domain names in order to prevent others from doing so.

“We have implemented a security measure to protect our customers,” the statement read. “The measure will kick in when a customer searches for an available domain name at our website but decides not to purchase the name immediately after conducting the search.

“After the search ends, we will put the domain name on reserve. During this reservation period, the name is not active and we do not monetize the traffic on these domains. If a customer searches for the domain again during the next four days at networksolutions.com, the domain will be available to register. If the domain name is not purchased within four days, it will be released back to the registry and will be generally available for registration.

“This protection measure provides our customers the opportunity to register domains they have previously searched without the fear that the name will be already taken through front-running.”

Nevett also lambasted domain tasters, stopping only slightly short of accusing them of gross misconduct.

“…[W]e are trying to take an arrow out of the quiver of the tasters,” his statement continued. “As you know, domain tasters are the largest front-runners. Due to no fault of registrars, front-runners purchase search data from internet service providers and/or registries and then taste those names. Some folks may not agree with our approach, but we are trying to prevent this malicious activity from impacting our customers.”

Nevett did not address questions about whether the domain names in NSI’s front-running warehouse are priced according to their popularity in the company’s WHOIS search or whether NSI sells its search data to tasters.

NSI Chief Executive Officer Champ Mitchell on Wednesday told PC World his company plans to begin notifying users of its policy and may add a feature that allows users to reserve names they have searched without consigning them to NSI’s front-running warehouse. That system would be tricky, he noted, because it would require cooperation from other registrars.

In addition, Mitchel told PC World, “We would be perfectly happy to end this process if ICANN or the registries would do something to protect small businesses or other small users,” adding that a $25 non-refundable registration fee probably would be a sufficient to discourage both front-running and domain tasting.