Without admitting violation of the law, NSI agreed to give affected users a one-year free domain registration or to pay to have the registration transferred back to a competitor, according to the FTC.
The charges were brought after a direct mailing campaign in which NSI told customers of rival registrars that their registrations were due to expire and that they should renew them with NSI as soon as possible.
This practice, surprisingly common for a while among registrars large and small, caused some customers to believe they were renewing an existing service, whereas in fact they were transferring their custom to a different company.
In NSI’s case the confusion was amplified, as VeriSign is not only a domain registrar but also the registry for .com and .net domains. At the time of the mailings, its share of the registrar market, where it was once a monopoly, was on the slide.
The scheme was often compared by critics to the practice of slamming in long distance telephony, where unscrupulous operators persuade users to switch long distance providers through a variety of deceptive means.
As part of the settlement, NSI also agrees to stop misrepresenting that a consumer’s domain name is about to expire or that the transfer of a domain name is actually a renewal.
This article was based on material originally published by Computerwire.
