Do Twitter ‘Squatters’ Create Headaches For Companies? Well, Ask Netflix

Some Netflix (NSDQ: NFLX) subscribers may feel like a weed-smoking Elmo is a fitting metaphor for the company after it decided to split off its DVD-business into something called Qwikster. But the revelation this week that the Twitter name “@qwikster” was being represented by a picture of a pot-puffing Sesame Street character was the kind of news that Netflix management didn’t really need right now. In addition to sparking a round of chuckles among Tweeters, it raised an interesting question for many new companies: what to do when someone else controls your Twitter handle.

For anyone who missed it, the Twitter handle @qwikster belongs to Jason Castillo, a young man whose online reflections include “Damn so manny cute ass gurl” and “english about boring as shyt tryin to go to soccer already.” Following the Netflix announcement about Qwikster, the number of Castillo’s Twitter followers leapt overnight from 12 to 12,000. The junior philosopher then responded with a series of tweets about a windfall he expects when Netflix offers him “bank” to obtain the name.

The news flap surrounding the Twitter handle led some wags to describe Castillo as “the luckiest stoner in history,” but it is not that simple. He will have a hard time cashing in on his handle because, under Twitter’s terms of service, the company has the right to take @qwikster away from Castillo if he tries to sell it. This is good news for Netflix because it means Castillo can’t blatantly hold the company over a barrel when it comes to buy the name. But it also means that Castillo has less incentive to part with it, meaning that Qwikster may not be able to obtain its eponymous Twitter handle, which for many companies, is the cornerstone of their social marketing campaigns. Ultimately, the Twitter ban on selling handles (if it is enforced) is unlikely to please either party in the long term.

This question about how to arrange the fair transfer of Twitter handles is not a new one. Two years ago, a site called Tweexchange made a media splash for being an online brokerage where buyers and sellers of Twitter names could connect. Now, the site appears to have ceased offering handles for sale — presumably because of the Twitter policy. There is also a newer site called TweetClaims, which offers to inform its customers when Twitter quietly releases a given user name. The site, which claims to have unearthed handles like “@beer” and “@autos,” provides a useful service but will be of little help if a name is already in use.

Even though Twitter says handle sales are not permitted, that practice appears to be taking place all the same. A year ago, for instance, the Israeli newspaper Haaretz reported that the Israeli government bought “@israel” for $3,000 from a man named Israel Melendez who said he was tired of receiving a torrent of anti-Semitic replies every time he tweeted. As for Castillo, he revealed on Twitter that at least three people have offered to buy the handle from him (alas, Castillo deleted his I’m-gonna-get-rich tweets sometime on Tuesday and also elected to replace the bake-me-Elmo pic shown above with a soccer team logo.)

In the coming years, more and more companies will no doubt discover that their intended Twitter handle is already taken and that there is a shortage of viable handles in general. It will be curious to see how the company responds. At present, Twitter has “no squatting” rules to free up dormant accounts, but these rules do not explain what companies can do if someone is holding on to a handle in bad faith. Asked by paidContent whether Twitter plans to introduce an arbitration-style process like the one that exists for disputed internet domain names, a spokesperson wrote that the company does not comment on future plans.

In the meantime, Castillo is warning others to stay away from his presumed good fortune. In his most recent tweet that remains online, he issues stern words to a potential rival: “Son u aint gonna make me like u if ur trying to copy my name for example @Qwikster2 fake ass.”

Clarification: As David Lawlor helpfully points out in the comments, Castillo is not a squatter in that he didn’t obtain the handle with a view to sell it to Netflix. The overall issue of how to allocate Twitter handles remains an issue, though, whether or not they were obtained in bad faith. If Twitter adopts a more formal policy, it will presumably distinguish between good faith owners and domain name-style squatters.