US-based collective buying group Groupon is in talks with a local competitor to potentially buyout www.groupon.co.za.
The Web site, which currently does not have any content, was registered by Wicount about a year-and-a-half ago. Wicount founder and CEO Aaron Toys says he registered the domain, because he wanted to join forces with Groupon.
Groupon bought out Wicount's main competitor, Twangoo, earlier this month for an undisclosed amount. Twangoo says it is the market leader in the segment, which is still in its infancy in SA.
The US company has been plagued by what it calls cyber squatters. In Australia, a tussle over www.groupon.com.au is set to go to court, as the domain owner, which also owns a competing collective buying site, has refused a buyout offer.
Friendly talks
Toys says his goal was never to cyber squat, as the site was registered because he wanted to form an alliance with Groupon. He says Wicount approached the US company about a year ago, but was turned away, because SA was not on its list of top 50 countries it wanted to expand into.
Wicount is in talks with Groupon with a view to selling the domain to the US company, notes Toys. He says discussions are amicable and Groupon is not threatening to sue. “I love Groupon... from the day I saw the business, I was amazed.”
Toys says his goal is not to gain a huge once-off payment from Groupon for the domain name, but he will sell it for the right value.
Wicount launched in March last year, about three months before Twangoo wrapped up its first order. Toys says he had been following Groupon from before it became the sizable company it is today. “In two years, it has exploded unbelievably.”
Collective buying sites work by securing discount deals with a range of partners, which are promoted to its community. Once a set take-up target is reached, each bidder has bought themselves a discounted item.
Legal tussle
Groupon spokesperson Julie Mossler says the company cannot currently “comment on the matter as they are in talks”. However, a blog by Groupon CEO and founder Andrew Mason details the trouble the company has had trying to break into the Australian market.
In the blog, Mason wrote that the company would like to expand to Australia, but is being hampered by a cyber squatter. Australian collective buying company Scoopon purchased the Groupon.com.au domain name, and registered a company called Groupon Pty Limited and a trademark.
“The way we see things, this is a classic case of domain squatting - an unfortunate reality of the Internet business. As Groupon became internationally known, opportunistic domain squatters around the world started to buy local Groupon domain names, thinking that we'd eventually be forced to buy them at an insane price,” wrote Mason.
He said the company had offered the founders about $286 000 for the Groupon.com.au domain and trademark, but talks have been unsuccessful and the matter is heading to court. Mason wrote the blog on 4 January and expects the lawsuit to take about a year to resolve.
Paul Jacobson, from Jacobson Attorneys, explains cyber squatting in SA is dealt with by the local .za domain name authority, UniForum SA, through an arbitration mechanism. He says the other option is to go to court and argue that intellectual property rights have been infringed.
Share