Thanks for all the responses. Our bucket does have vertical nipples. It's all we could find at TSC. We also have a submerged heater snaked through the top hole. I don't think the threads are leaking; our birds just seem to be messy drinkers.
Could people who use this method speak to how they keep the litter dry? We just started using using a suspended bucket with nipples and they leave quite a bit of water on the floor of the coop. Thinking about moving the water outside but it will be pain in our New England winter.