November 9, 2017
ICANN’s predictions of a downturn in the drop catch market have come to pass as almost 450 drop catch registrars have lost their accreditation in recent days. Most of these were shell companies operated by Pheenix, one of the big three drop catching firms, the others being Snap Names/Namejet and DropCatch.com.
Drop catchers catch domain names as soon as they expire (drop) and organise the immediate reregistration of said domain by one of their many registrars and partners, the aim being to register as many of the most sought after domain names as possible in order to sell them at a profit.
As no breach notices appear to have been issued by ICANN against the registries, they were most likely let go by Pheenix as opposed to being terminated by ICANN.
ICANN Vice President Cyrus Namazi stated earlier this year that the drop catching market is not big enough to support the huge numbers of shell registrars that the above three drop catching firms have created over the past few years and that a huge fall in numbers was inevitable.
The explosion in the number of drop catch registrars created appears to be at least partly due to a certain number of actions taken by Verisign, the .com registry.
When a “.com” domain expires, the drop catch registrars robots contact Verisign’s servers to try to reregister the domain name. The more registrars available, the better the chance of obtaining the domain name hence the creation of huge numbers of registrars by the drop catch firms.
However, a change may be imminent. Verisign have a U.S. patent application currently under examination for a system for Detecting and Mitigating Registrar Collusion in Drop-Add Acquisitions of Domain Names. It describes a way of working out which registrars are colluding to catch expired domain names and how to mitigate this.
It remains to be seen how Verisign will use the system and the future impact on the drop catching business.