The only thing that bothers me the most on the subject of domain names is when I try to find a domain name for a new site only to find that most of the names I can think of are already taken. Even more annoying is that these names are not used for a site related to the domain name.
Domain or cyber squatting is the term used for someone who registers a domain without intending to use it, which would otherwise be used for a site related to the domain name.
Let me give you an example, I recently came up with an idea for a site and there were a couple of domains that were ideal, keyword1keyword2.com and the plural version, so I checked if they were available. I found out that the two names that I thought would be perfect were taken. Both domain names were directed to a generic search page whose sole purpose is to make money from direct types.
Now I have not given the names because I do not want to reveal my idea and I do not want to give free publicity to the sites. This is not a one-time occurrence, but something that happens quite frequently, especially with domain names with good or popular keywords. This activity is not illegal unless you use a trademark name, but it is against the ethics of what the Internet is all about.
There is a difference between domain occupation and domain parking and that difference is intent. If you register the domain with the intention of using it in the future for a domain name-related purpose, then you have just parked the domain. If you register a domain with the sole intention of making money by reselling it or earning income from the people who enter the domain name, then that is domain occupation.
As I have explained, it is not illegal, it is just unethical, it is a free market economy and people are motivated by profit. I do not agree with domain occupation as it forces webmasters like me to use domain names that are far from perfect, take this site in domain names, this name was far from my first choice. It also misleads internet users into expecting a site to be related to domain name keywords, making the internet less user-friendly.