There are two issues that, in my opinion, contribute to massive squatting problem. First, squatters can buy domains in bulk and pay next to nothing for each of

There are two issues that, in my opinion, contribute to massive squatting problem. First, squatters can buy domains in bulk and pay next to nothing for each of them. (Sometimes they pay nothing at all, abusing trial periods and renewal rules.) This is what makes squatting on such a massive scale possible. Second, modern DNS structure is effectively a global namespace: there are only a handful of TLDs that matter and they are awfully generic, so they collide. TLDs do not classify anything, and they should. Also, if someone bought the name you want, there are no equivalent (but different) alternatives. That's another thing that makes squatting profitable.