[Nettime-bold] Network Solutions Sells Marketers its Web Database

[Curt Hagenlocher <curth@motek.com>]

Network Solutions Sells Marketers its Web Database
By Thomas E. Weber, Staff Reporter of The Wall Street Journal


The Internet's phone book is up for sale--and though the listings
may represent a treasure trove for marketers, the move also risks
a serious privacy backlash.

At issue are millions of entries in the domain name database
operated by the Network Solutions unit of VeriSign, Inc., Mountain
View, Calif.  It is, essentially, the master address book for the
Internet.  Since the dawn of commerce on the Web, companies that
want their own dot-com addresses have registered with Network
Solutions.

Now Network Solutions is selling that information.  "On your mark,
get set, go!" gushes a recent advertisement in a newsletter for
direct marketers.  "Available for the first time ever.   Approxi-
mately 6 million unique customers, sliced and diced for you to
target prospects, learn about a specific audience or retain
customers.  ...Take this information and run with it."

Exactly what's for sale may come as a surprise to many of the
individuals and businesses who have registered Web addresses.  In
addition to names, street addresses, and other routine information
gathered when someone signs up for a domain name, Network
Solutions promises marketers information on whether sites are
dormant or up and running, whether they're set up for e-commerce
--even whether a site has security precautions installed.

Network Solutions says that while the sales pitch is new, it
actually has been quietly selling such data for at least a year.
Now, the company says, it is moving more aggressively to cash in
on the information.  "It's old wine in new bottles," says Doug
Wolford, general manager for Web presence at VeriSign.

The move underscores the growing pressure on Internet companies
to find new sources of revenue.  Now that the Net boom has slowed,
many dot-com companies view customer databases as a tempting asset.

But such strategies can be perilous given consumer concerns about
privacy online.  Last year, online-ad concern DoubleClick Inc. was
forced to back off a plan to combine Web-tracking data with offline
databases after the move triggered a firestorm.  And when online
retailer Toysmart.com shut down in May, a plan to sell its customer
database provoked a similar controversy.  Walt Disney Co., a
Toysmart investor, offered to purchase and then destroy the data
after the Federal Trade Commission moved to block Toysmart's plan.

The Network Solutions database is a key part of the Internet's
infrastructure.  Internet computers rely on numerical addresses to
route information around.  When someone registers a domain name,
the information is used to tell computers all over the Internet how
to translate that dot-com address into the appropriate numerical
address.

Registrants also must provide the name, telephone number and email
address of a technical contact for their site--information that
can prove vital for someone trying to trace a hacker's attack or
verify whether an online business is legitimate.

Under its agreement with the U.S. government to operate the data-
base, Network Solutions is required to provide public access to
the data.  Anyone can visit the Network Solutions site and look up
the information on Web addresses one by one.  And indeed, some
marketers--especially those sending unsolicited "spam" email--have
laboriously harvested information this way.

But for marketing purposes, it's much more useful to have a com-
plete set of data outright.  Network Solutions offers marketers
this option--for a price and under its guidelines, which include
stripping out email addresses and forbidding the use of the infor-
mation for email marketing.

Mr. Wolford says the data are typically used by companies that
want to send direct postal mail to Web businesses or simply want
to merge the data with existing lists to flesh out customer
dossiers.  Network Solutions also allows its customers to opt out
of the list and takes steps to insure that only businesses, not
consumers, are included in the marketing efforts.

While downplaying any privacy concerns, Network Solutions is
telling marketers that its data are a great way to sell things,
especially where small businesses are concerned.  "Nobody offers
a better snapshot of this hard-to-reach group ... over 80% of our
customers are small businesses, representing every major small
business category you could hope to reach," proclaims an infor-
mation page at www.dotcom.com, the site Network Solutions uses to
promote its data business.

And the fact remains that it's impossible to obtain a Web address
without registering for one--either with Network Solutions or with
one of the other companies that popped up when the U.S. government
opened up what had been a Network Solutions monopoly on dot-com
domain names.

Consumer advocates say any organized effort to use the data for
purposes other than the intended goal of obtaining an address is
troubling.  "There's an increasing loss of faith in the ability
to have your information used only for reasonable, legitimate
purposes," says Lauren Weinstein, a privacy advocate who writes
an email newsletter about cyberspace issues.  Mr. Weinstein
alerted his readers to the Network Solutions effort in a bulletin
this week.

Registering a domain name is a simple process that can be done
online in minutes.  Network Solutions charges $35 a year for each
address, and asks for a contact name, phone number and email
address that go into its database.

So how does it know whether a site is up and running, or whether
it is engaged in e-commerce, or any of the other pieces of infor-
mation that it is promising to sell to marketers?  Mr. Wolford
says the company sends software "robots" out onto the Web, using
much the same method that search engines use to catalog sites.
Those robots can look for key phrases such as "online ordering"
or "credit cards accepted" to determine whether a site has
e-commerce.

--
Curt Hagenlocher
curth@motek.com


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