Google Profiting From Typo Squatting, Report Charges
blog.wired.com
blog.wired.com
Who is losing out in this situation? I think many of us have seen enough usability tests to know that a 404 could stop a user dead in their tracks. Instead, though, we have a proper site suggestion that is clear and directs the user where they meant to go. If BofA was really upset at all this, they could take it up with site owners, or stop buying into Google's ads, but they know better.
Aside: It's pretty depressing that Harvard professors are spending research money on things like typo-squatting and publishing papers on it.
Not what the article is about. Domain squatters are registering commonly misspelled domains and filling them with Google ads. The point is whether or not they should be allowed to own these domains (copyright), and whether or not Google should be allowed to profit from them. I don't think anyone is advocating a different way of 404 handling (another huge area for potential profit, see NSI/FF etc.)
That being said you need a lot of traffic to get into their program. The type of people with high-traffic unused domains are typically domain squatters.