Transcript of Domain Scam Interview with Domain Expert Simon Johnson
Justin: Good day everyone! I’m Justin Meadows and welcome to Evergreen Profit’s podcast. Today we’re talking about domain scams and to help us shed some light on this matter we’ve got Simon Johnson who’s a domain expert. Simon’s co-founded one ofAustralia’s first internet service providers and internet security companies so he’s been around the stuff doing his thing for quite a while. He’s got 15 years experience with internet security and risk and is used to be a contributor to the APC Magazine and also a best-selling author in the area of internet safety having written keeping kids safe on the internet which was published worldwide. Simon now runs a popular domain site called DomainerIncome.com and he’s now pushing for a reform within the .au domains administration to increase transparency and allow more free market approach to the .au domain space. So welcome Simon and thanks for coming on today.
Simon: No worries. Thanks for having me.
Justin: And just to let the listeners know a brief introduction to what this scam is actually about, this has become a bit of a personal thing for me because my grandmother was actually sucked in it by this scam and that sort of led me to take action. There’s these companies out there that would send out letters to people that look like a legitimate invoice for their domain even going so far as to have a Collins street address in the header which for those of you outside Victoria, that’s the corporate area (the Melbourne CBD) so it looks pretty impressive but their actually charging you for a domain which is different to your website so instead of a .com.au they might charge you for a .com or a .net.au. Usually their annual registration cost is hugely inflated. In my grandmother’s case, she was actually charged 250 dollars for a .com which is roughly twenty times the normal price! Also, this is something that a number of my clients have been approached me. Luckily, most of them came to me first and said, “Is this legitimate?” but I just thought we’d shed some light on the matter and let people be aware on what’s out there and what they should be doing. So I guess yeah firstly, what’s your take on this scam Simon because I know it’s not necessarily the worst scam out there because they are actually providing you with a domain. They do come up with the goods but marketing in such a deceptive way at such inflated prices is pretty criminal in my opinion.
Simon: Yeah, it is. I will say that I’m not a lawyer but you know certainly I think at best in my opinion misleading and deceptive but it isn’t the worst scam out there. There are lots of other scams but this seems to be the most popular and that’s been going on well at least more than 10 years than I know about. It was very, very popular in the late 90s when people were just still learning about the internet and it was relatively new. I remember back then it was an issue and just when atoms were forming, the regulator, they decided to take some action and that was to hide the Whois details in Australia particularly email addresses and other things to make it difficult for scammers to actually get your business address. That was in my opinion very ineffective because obviously, you’re gonna put your business address on your website. So you know, what do you do. It’s one of these things where education is the key and I think that if we look into it a bit deeper, it’s also about people just being fallible. You know, small business has enough on their plate and they get an invite that looks like it’s for a domain and it’s easy to just go and pay it then be done with it. I think that’s the sort of thing that these people are taking advantage of.
Justin: Absolutely. So what advice would you be giving to local businesses if they do get these emails or letters and speculate it might be a scam?
Simon: I think the first thing to do really is to know who you’ve registered your domain names with. And if you’re like many small businesses, you really got one domain or lots and lots of domains. They usually fall into one or two categories. So if you fall into the first category, if you only got one or two domains, it’s pretty easy to know who your provider is. The key thing is knowing when these things come up for renewal and not just to blindly click on any email you get sent or respond to anything you know credit card form in the post. A lot of these scams you know as you pointed out earlier do have the appearance of having legitimate addresses. We get these emails quite a lot because we have a large number of domain names so we get lots of emails and lots of letters. Some of them I have noticed come with overseas postmarks and that’s often a giveaway as well. So these people are spending a lot of money trying to get in contact with you and to them it’s a numbers game. So really it’s about just keeping an eye on it and knowing when your domains come up for renewal. Perhaps doing things like what we do, like paying multiple use in advance so you don’t have to go through with the grief every year for renewing with that domain name so that’s a good thing as well.
Justin: Yeah, cool. Also if people do find after hearing or reading about this they are actually have been caught in one of these scams and now paying too much, what steps can they take to get out of that scam and make sure that they keep their domain? What can they do? What things should they be aware of if they’re trying to do that?
Simon: Well it really depends on the type of scam. I think that you know somebody is saying to you that in order to re-register or renew your domain name you’ve got to pay us 250 dollars and their not your registrar than obviously just ignore it and rip it up. But if your domain name in now in the hands of some dodgy registrar somewhere who’s demanding lots of money then you can contact your registrar. You can obviously get some legal advice on it. You can contact the Australian government run scam watch. There’s a whole host of things that you can do depending on the circumstances. The reality is, it is tricky and there’s no one size fits all kind of approach because of some of the misleading conduct and the dodgy practices we see in some parts of the industry.
Justin: Yeah, now also for businesses out there that do have a .com.au and are thinking about getting a .com or perhaps the other way around, do you just wanna explain to people what the differences are between the two and why they might want a .com or a .com.au?
Simon: Yeah, I think a .com.au is quite well known inAustralia being the Australian domain name. .com is more of a global domain extension if you like for global businesses. I prefer .com however some search engines like Google can give preferences to .com.au domain names because they are local domain names representing Australian businesses. There are pros and cons to both. Sometimes you need a .com if say you would like to trade internationally. Some people, the local businesses are quite happy having a .com.au. One thing I will say is that it can be tricky justifying a .com.au as there are more rules in registering a .com.au. There are no rules when it comes to .com. So sometimes during the application process you may be knocked back. Sometimes it might be used down the track and you might get asked to justify how you are related and why you should even have the .au name so it’s a bit of a mind field.
Justin: Yup, so that’s what doing a bit due diligence when you’re looking at getting a .com.au and find out what the rules are around that. For people that do have both, I know some businesses have a .com and .au, do you think it’s worth building out two websites or just redirecting one to the other. What do you think most people especially local businesses should be doing?
Simon: Well, they definitely should be building out websites because you’ve got a domain and you don’t have a website on it, that’s a problem. So you really do need to build it out. It doesn’t have to be very expensive. It just has to be done in a smart way. You know, I know plenty of people that have a .com and .com.au, maybe they have a website that is their main kind of business website and maybe that have another which just generates leads and customers for their business. So if you’ve got a spare domain name, I strongly urge you to develop it out and make it work for you.
Justin: Yeah sure. And what about .net.au and .org.au? Do businesses need to grab those as well?
Simon: It depends on the business. If you’re building a brand then you want to protect your brand, I think 20 or 40 dollars a year or whatever your rate is to buy a .au domain name is a no-brainer. It’s a worthwhile investment. A .org.au has rules around that specific around who can register. Take for example for charities and not for profits and things like that. A .net.au has become increasingly popular although at this point in time quite difficult to get ranked in Google but you know, not impossible either.
Justin: Speaking of ranking in Google, I know a lot of people when they are getting their domain names try to go for keyword rich domain names. They might try to get dog training Melbourne even though their company’s name is Bob’s Dog Training. What’s your take on the brandable domain vs. the keyword domain?
Simon: Look, I like both. I think there’s place for both. I don’t think their mutually exclusive. I think if you’re building a brand and you’re building value, then you are gonna have an equal amount of success if you’ve got a good domain name, do a lot of marketing, do SEO and get some good advice. Having said that, people do search on keywords. Keywords are popular and they get a lot of traffic so for me I would have both. I would build a brand but I will also try to get the keyword domains in my market as you used in the dog training example and I would use that to generate leads for my business. You’d be crazy not to.
Justin: Another thing that’s pretty new is the .tv, .co and domains like that. What’s the deal with those just for those that are not aware?
Simon: Well, things like .co, .tv and .me have been popping up overtime. They’re called country code domains so .tv is Tuvalu, .co is for Colombia and .me is Montenegro but in terms of their use, I think people have been using them as vanity urls. I myself, for example have SimonJohnson.co largely because I couldn’t get the .com so it was just an alternative for me. It was a bit of a throwaway site and I don’t mind that. Would I based my entire business around .co? Hmm… maybe depending on how I want to do the other areas of SEO and marketing a brand. What we’re seeing now or we have seen over the past years a lot of these country code domains pop up out of nowhere and what we’re also gonna be seeing in the future is ICANN, the body responsible for internet governance looking at expanding the number of top level domain names to .anything so you can be a body that handles a top level domain name if you’ve got an idea for example a .app or .bank or .whatever. You can pay your hundred plus thousand dollars which is non-refundable to ICANN and create your own registry that way. So you know who knows what the future’s gonna bring there. I’m sure there will be some very big successes that will be promoted and I’m sure there will be a lot of failures in there as well. But I really believe it’s a bit of a trap in that can get far too focused on domain extension and not focused on building a brand and adding content. I think it’s important to get the domain name right at the start and you really want to make the best possible choice then moving on from that there are a lot of other factors to concentrate on.
Justin: Absolutely! Now, just back to this scam, what sort of process do you think people should be expecting to pay for a .com or a .com.au?
Simon: That’s a pretty good question! I say a variety of pricing. It’s all over the spectrum. I’ll give you examples. You know for us I know we pay the wholesale rate for a .com.au but in retail I see the cheapest I have seen could be around 25 dollars upwards and it has been some years it has come upwards down to a hundred dollars. The key thing in there is there’s really no added value. There’s a perception about added value. You are not getting anything, your domain’s not gonna be better by paying a hundred dollars than it is by paying 30 dollars. You might get better support perhaps but that’s about it. So in terms of .com, that could vary. It usually depends on how many domains that you buy but around the 10 dollar mark is pretty much a wholesale or retail rate and it comes down from there. So these things go up and down all the time largely because they are controlled by companies like Verizon. Every now and then, Verizon decide that they’ll increase their rates which mean everyone else and other registrars will have to or choose to increase their pricing as well so it gets passed on to consumers. It does vary and I will say one another thing is that sometimes throughout the years there are specials and coupon codes and things like that fledging around where you can get a very cheap deal on a domain name. Those are special deals that happened with the registrar or if they’re not the special deals, the registrar has chosen to take a bat on their domain names in the hopes that you’ll take out hosting with them so that’s an entirely different model altogether.
Justin: Yeah cool. Another question that I found comes up a bit is people often don’t quite understand the process behind it but what actually does happen if people forget to pay their domain by their renewal rate?
Here is the image Simon created to explain how the domain lifecycle works.
Simon: That’s a really good question. That’s often a very popular one. It largely depends on the domain name so I’ll answer it in generic terms. So every domain has an expiry date. Usually you’ll get notified via email or it will be sent out to you. Say your domain expires on January 10and if you don’t pay it on January 10, it will go into a grace period where you’ve got 15 days or 30 days whatever it is. There are different rules for different domains. Essentially, this time period elapses and you can try to register within then. If that fails, it goes into another phase called say pending delete which means it’s usually about a 5-day period whereby there’s nothing you can do. The domain name is gonna get deleted and too bad. After that period of time, the domain actually gets deleted which means it becomes available for anybody to register. Now the tricky part of this equation is, there’s a whole sequence of steps from when a domain gets deleted to when it becomes available. There are some backroom deals between registrars who give deleted domains or provide deleted domains to third party companies to sell. There are other companies that step in literally the millisecond after the domain gets deleted and register them again. So it’s really a complex equation. Quite amusing now I did a little graph of the whole system. I might give you that if it helps your listeners. It explains how that process works so you’ll be able to look up where your domains are within that lifecycle.
Justin: Are there any other things you would like to share to listeners that would perhaps are commonly asked questions that you encounter?
Simon: I think you’ve covered, in terms of the domain investment field, you know in buying names I think you have pretty much covered it. I think the one thing that jumps out at me that I get asked quite frequently at conferences and places is how do you value domains. So if you have a domain, let’s say dogtraining.com.au, a lot of people ask me how much is my domain worth. If I was to sell it to a third party. You know, how much would I get paid and the answer to that question is it really depends on the market. It really depends where you sell it. So I do know that certainly a lot of businesses in particular small businesses have been sitting on domain names for awhile and a lot of businesses have their ups and their downs. Some go out of business and a lot of domain names expire. There’s quite a large market, very large market in fact that sells domain names and websites for that matter. So some of the things that I’ve done in the past is look at what other domains have sold for and that’s a term called comparables. It’s a real estate term where you look at say a two bedroom house down the road with a little garden might sell for x thousand dollars versus a large mansion near the beach might sell for y thousand dollars. The same principle applies to domain names so when you look at these things, you can usually get a feel for how much your domain’s worth. Now, on top of that, obviously if you’ve build a website, you’ve got some traffic, an email list and a social networking profile, all of those things can be effective as well. But it’s a complex process, we probably don’t have time. We spent all day talking about this stuff but it is an important one for small business.
Justin: So for those of you who want to find out a bit more information about domaining and about you Simon, what’s the best way to find that info?
Simon: Well, if you’d like some more information on domain names and how much they’re worth, if you’d like to buy some domain names and don’t really know where to look, you can go to DomainerIncome.com and I also blog on and have a pretty extensive website at SimonJohnson.co. So if you’d like to know more about me and what I do, that’s where to go!
Justin: Great! And thank you very much for taking the time to speak to us about domains.
Simon: No worries! It’s been great.
Justin: For those of you listening or reading this blog post, I encourage you to add your comments down at the bottom of the post and share your experience about scams that you might have encountered or scams you might want to alert people to as well. So thank you all for listening and look out for the next podcast.