Are You Working with a Domain Registrar or a Reseller?

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Since we work with investors quite a bit, they sometimes ask us to do some tasks outside of the norm for an agency. One investor that we work with hires us periodically to handle their domain purchases. It works well to have an interim company to handle these processes since it’s typically quite a bit of negotiation and large sums of money going between parties.

The process is fairly straight forward. We utilize a third party escrow account that certifies that we’ve deposited the funds for the other party and then we authorize release of the funds when we get ownership of the domain name. If any type of disagreement occurs, the agreement will go into mediation. This stops unscrupulous business transactions from happening.

A few weeks ago, we negotiated the purchase of a domain from a private party. The domain was registered with Yahoo! Small Business… or so we thought.

We deposited the money in escrow and then the fun started. We assisted the other party unlock the domain and authorize transfer of the domain to our client’s domain registrar. This is a fairly simple process if you know what you’re doing, it just takes time depending on the domain registrar.

I checked both the client and the private party’s domain accounts the following morning and nothing had changed. The next day I checked again and the transfer was canceled. I called the private party and he said he hadn’t done anything.

I set up a conference call and we dialed Yahoo!’s support team. After waiting quite a while, we were met with a support tech that said that we couldn’t transfer the domain externally, but if I had a Yahoo! Small Business account, we could transfer the domain from account to account.

If you’ve bought or sold domains… your ears probably just perked up at this. After a ton of domain transfer disputes, ICANN regulated this process to ensure that you could transfer domains easily from one registrar to another. This was done to ensure domain registration companies couldn’t hold their clients hostage.

This was the question I posed to our Yahoo! support representative but he didn’t seem to understand the premise of the question so we just kept going. Here’s when it starts to get scary.

I registered a Yahoo! Small Business account for my client while on the phone with both our third party and the Yahoo! representative. The representative then told the third party to cancel his account so the domain could be freed up and for me to immediately register the domain to retrieve it.

What?! So we’re going to basically put this domain out on the market for a few minutes and then register it again?! What if we lost the domain at that point to some sharp domainer out there with an automated purchasing process?! (I don’t know if that actually exists, but I couldn’t believe the request). I questioned the representative and he assured me he would have control over the domain.

So we pulled the trigger and I registered the domain in my client’s brand new Yahoo! Small Business account.

Or did I?

A day later, and the domain was still in the third party’s account and was showing up in mine but not fully transferred. At this point, I did some research and a WHOIS lookup to see the public information associated with the domain. Sure enough, it said that the domain was still registered with the third party. But here’s the strange part… the domain registrar wasn’t Yahoo! Small Business, it was Melbourne IT in Australia.

I put a ticket into Melbourne IT and they wrote back a day later that they were the real registrar and that Yahoo! Small Business were just resellers. Arghhhhhh! All of that time was a waste.

So, we began the domain transfer process at Melbourne IT. Long story short, they also have a convoluted system where you can’t really move a domain from one account to another. You simply move the account owner from one person to another. I did just that and paid another fee (I have no idea what I paid for at Yahoo! Small Business).

Here we are a couple weeks later and I believe we’ve got the domain finally being transferred. My latest notice said that it would take up to 7 days for completion so wish us luck!

The Bottom Line

The bottom line here is that you need to watch out where you’re registering your domain. The process, lack of documentation, ignorant support and even the process that, I believe, violated ICANN regulations, was frustrating and ridiculous. I have no doubt that the process could have been much easier if the domain was registered at a registrar instead of a reseller.

Better yet, just stick with GoDaddy. Not only will you avoid these issues, you’ll also spend a lot less and get great customer service.


  1. 1

    Hey Doug,

    I just started a project where I’m moving a client competely away from Yahoo small business to Godaddy, so perfect timing. My question should I just skip trying to go through Yahoo small business and talk with Melbourne IT? Also, assuming all goes well, does it look like you will have full control of the domain with Melbourne IT completely out of the picture? Just wondering if we should just leave the domain registered there, instead of taking a risk and time otherwise.


    • 2

      Hi Jon, honestly the experience has been so terrible (and Melbourne’s Domain interface doesn’t even work in Chrome), I’m out of there. The domain is being transferred (fingers crossed) right now.

  2. 3

    Thanks for the reply Doug! I look forward to updates on this. I have only dealt with one other client through them and I chose to keep them there because of this difficulty. At the very least, I hope people see this blog post and choose not to start their foundation through Yahoo small business. I’m a firm believer in giving every business owner the ability to control their own assets. Too many times people don’t even realize the technicalities of getting involved with a company that makes what should be an investment, a loss, when they choose to find another company.

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