I wrote this in response to a local Better Business Bureau warning about a web hosting invoicing scam.

As somebody who has been in the domain name and web hosting business for 8 years, I hope to provide some insight on the matter. It is written to be as simple and straightforward as possible.

Avoiding Domain Name and Web Hosting Scams

Know The Parties You Pay

The first thing your company should do is make a complete list of the names of companies you pay for your website needs.

The three standard parties for every website are as follows:

1. The domain name registrar – registers your domain name – xyz.ca or xyz.com
2. The web hosting company – runs the computers that make your website come up when people type it in
3. The web developer/designer – contracted professional services to design and/or maintain your website

Often number 1 and 2 are the same; in some cases all 3 are the same.

Your web developer/designer is the best resource for determining if there are any other payees to include on your list.  For most basic websites, there will not be any additional parties to pay. Some examples of legitimate parties might include companies that offer e-commerce/credit card processing, software licenses, search engine optimization services, and site security certificates.

Three Things You NEED to Know About Domain Names

During the domain name registration process, there are actually several parties involved, and money changes hands at various points.  This is where it becomes confusing.  And because the domain name business is “crucial”, “time-sensitive” and “misunderstood”, it is ripe for scam artists.

Here are the 3 things you NEED to know:

1. You don’t “own” a domain name. Registering a domain name gives you the contractual right to use it for a specific period of time (typically between 1 and 10 years).  You must renew it before it expires or your website and e-mail using that domain name will become inactive.  If you don’t renew it, eventually somebody else will be able to register it and use it for themselves.
2. You pay only one company for domain name registration – your selected registrar. If you receive invoices relating to your domain name from companies other than your chosen registrar, it is almost certainly a scam.  If you think it might be legitimate, check with your web developer/designer before you pay it.
3. Your primary point of contact for your chosen domain name registrar is your e-mail address. If you change your e-mail address, make sure you update it on your domain name registration!  (Not only will this help you prevent having your domain name stolen, but it will also ensure you receive timely renewal reminders, thus avoiding website downtime.  An expired domain name is the number one reason why a website goes down.)

What About Brand Protection?

By now, you probably received solicitation to “protect your brand” by registering additional domain names.

Remember item 2 above – you choose who you register domain names with, not the other way around.  Don’t be bullied into buying something because of an urgent sounding e-mail (or unsolicited ad mail).  Choose a trusted registrar and register your brand protection domain names with them.

An example of this might be:

• Your website is abc123.com
• You register abc123.ca, abc123.net and other variations to prevent others from registering it.
• You prevent dilution of the “abc123″ brand.

As part of a well thought-out strategy, this is a legitimate, and not terribly expensive exercise to undertake.  However, if you’re not sure how to proceed, speak with an internet branding specialist, your web developer/designer, or your trusted registrar about strategies in this area.

What’s All This Jargon: Registrant, Registrar and Registry

People are often curious about how all this stuff works.  For most, it’s a big mystery, and the jargon doesn’t help.

Here are the basic terms explained in the simplest way:

• Registrant – This is you.  If you own a domain name, you are a domain name “registrant”.  You cannot be called an “owner” (as per item 1 in the previous section).  The registrant pays fees to the registrar.
• Registrar – This is the company that you choose to register your domain name with.  If you do not like the company you chose, then choose another one and transfer your domain name to them.  The registrar pays fees to the registry.
• Registry – Think of this like a property registry in your municipality.  For legal (and, in this case, technical) purposes, all the domain names are registered in one central “registry” and the company who operates this registry is called the “registry operator”.  (Because there are so many domain names and competition typically leads to better service, the “registry operator” does not directly register domain names.)

So “registrants” use “registrars” to “register” domain names in the “registry”.  Say that 10 times fast!

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