April 26, 1999 Web posted at: 10:58 a.m. EDT (1458 GMT) by Sandra Gittlen and Denise Pappalardo

From...

(IDG) -- Over the next few months, ISPs such as America Online, AT&T and Verio will begin bundling domain name registrations with their Internet business services. But customers should check the fine print of their contracts to make sure that they retain rights to their online brands if they switch ISPs.

The Internet Corporation for Assigned Names and Numbers (ICANN) last week announced that five companies, including America Online, will participate in a test bed for a new domain name registration system designed to end Network Solutions, Inc.'s monopoly. Under the test bed, the new registrars will hook into Network Solutions' database in order to sell a pool of names in the .com, .net and .org domains.

ICANN also unveiled a list of 29 companies, including AT&T and Verio, that will enter the domain game after the test bed is completed in July.

While the announcement sounds the start of competition in this market, it raises a serious question for users: If ISPs offer domain name registration as an add-on to Web services, then who owns the domain?

Currently, users register their domains directly with NSI or through an ISP that then hands the $70 two-year registration fee over to NSI. In either case, NSI recognizes the user as the direct owner of the domain name, which can be used to establish a company's online brand through URLs and e-mail addresses. NSI also lets users switch Web hosts without paying additional fees or losing their brand.

Under the new system, ISPs that have been selected by ICANN can process registrations themselves. Already, ISPs are figuring out ways to offer domain registrations free. For instance, some ISPs will forego passing on to customers the $18 shared database fee owed to NSI if customers choose them to host their Web sites. By bundling in the registration, the lines are blurred about who owns the domain, and it leaves room for ISPs to hold customers hostage by saying the customers lose their domain if they switch ISPs.

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For Deborah Alexander, owner of online Jewish foods distributor Kosher Grocer, this is a scary prospect.

Alexander has switched ISPs twice and is about to switch again. She also is in the process of registering more than a dozen new domains. Alexander says that if her brand were attached to her Web hosting contracts, she would be tied to one provider and not be able to get a better deal.

"The only way this is going to work is if you write into your contract that you own the domain," she says. "Users need to have ownership of their domains. If your domain keeps changing, you'll have no name recognition."

Doug Armentrout, vice president of Web services at Verio, agrees. "Customers should get the details of who owns the domain spelled out in a contract," he says. While Verio plans to hand domains over to users, he says "there are a lot of smaller ISPs out there that will use domain registration as a way to retain customers."

"There is no real benefit to AT&T's customers if we hold ownership of domain names, so I doubt we would do that," says Rose Klimovich, director of IP services at AT&T. But AT&T is still in the process of establishing how it may integrate domain name registration with existing services such as Web hosting, she says.

AOL says it also has not figured out how it will blend in its new role as registrar with its existing services.

ISPs that have been approved as registrars could potentially register a block of domains themselves, then lease them to customers. Armentrout says ICANN should create guidelines to prevent this.

While ICANN has loose suggestions concerning portability of domains, ICANN President Mike Roberts says there is no hard and fast rule by which registrars have to abide.

"ICANN is not going to try to be an umpire in business practices," he says.