system
Given the following post, respond as if you're commenting on Reddit:
human
ELI5: What happens after a company forgets to renew their domain name? Can the person who bought it afterwards negotiate a huge price for the company to get it back?
gpt
> What happens after a company forgets to renew their domain name? 

Once the domain expires, it enters a renewal grace period of about 30 days where the original owner can reclaim it. Once that 30 days is up, it enters a "redemption period" where the domain is frozen for 30 more days and drops from the zone file. The original owner can reclaim or make changes to the domain, but the registrar fees at this point are often well into the hundreds of dollars (which is easily still worth it if the alternative is losing your business).

For about 5 to 10 days, it goes through deletion processing where it is dropped from the registry and is available to be registered by the general public.

Some registrars will retain their deleted domains to auction them off; whether they do it themselves or have an agreement with a third party auction house depends on the registrar.

More often than not, a domain that had an established website never makes it through deletion processing and is sold off for auction. Old domains that had measurable bodies of content, users, or search volume can be extremely valuable and can sell for many thousands of dollars.

When it's bought at auction, the new owner can use the domain as they see fit. The vast majority of auctioned domains end up in a portfolio of domains owned by a reseller; we call them a squatter. They often prompt the original domain owners, their competitors, and other interested parties to buy the domain well above cost. 

> Can the person who bought it afterwards negotiate a huge price for the company to get it back?

This is legal as long as the domain isn't a registered trademark and they aren't trying to actively impersonate the original owners of the domain. If there are trademark or legal issues, there are avenues people can take to reclaim their domains; otherwise, they're out of luck and either have to pay the squatter's exorbitant fees or find another domain. I've had companies that drop their domains because no one was monitoring their registrar billing information that were squatted and reoffered to them for tens of thousands of dollars. 

The moral of the story is to always make sure your billing information is up-to-date, and set your domains to auto-renew.