Domain Names: The New Real Estate
These are boom times in an estimated $2 billion
industry that involves the buying and selling of domain names. When people type
the generic names into their browser's address field, sites that generate
pay-per-click ads appear. Such "direct navigation" bypasses search engines.
"This industry is like the wild, wild West," said Jerry Nolte.
Inside a midtown hotel, Larry Fischer is on his cell phone with a financial
backer as his partner Ari Goldberger does quick research on a laptop computer.
They are bidding furiously at this auction of Internet domain names, with hopes
of snagging megayachts.com. The duo won't be deterred. They want this name.
"$110,000, yes or no? Quick," Fischer barks at Eli, the investor at the end
of the phone.
Someone else makes a bid for $120,000. Fischer and Goldberger up the ante,
and then again.
Going once, going twice ... sold to Fischer and Goldberger for $150,000.
"You got it," a smiling Fischer tells Eli. Mazel tovs are exchanged.
These are boom times in an estimated $2 billion industry that involves the
buying and selling of domain names. When people type the generic names into
their Web browser's address field, sites that generate pay-per-click advertising
revenue appear. Such "direct navigation" bypasses search engines.
"This industry is like the wild, wild West right now and people have no idea
how fast it's growing," said Jerry Nolte, managing partner of Domainer's
Magazine, a new trade publication devoted to this little-known world.
Some believe the industry's market value could reach $4 billion by 2010 as
people continue to purchase approximately 90,000 names a day and the number of
domain registrars swells.
At the end of first quarter 2007, at least 128 million domain names had been
registered worldwide, a 31 percent increase over the previous year, according to
VeriSign Inc., which runs some of the core domain name directories for the
"It's not about words," said Monte Cahn, founder and CEO of Moniker.com, a
company that specializes in domain asset management and held the Manhattan
auction. "It's like real estate. This industry is only about a decade old.
People looked at domain names as a commodity. It's a piece of real estate on the
Web that can't be replaced. It's your stake in the ground, your stake in the
At the Manhattan auction, Fischer and Goldberger snatched up four names for
more than $1.2 million and a fifth for a client, representing only a handful of
the names sold for a total of $12.4 million during both the live and silent
The auctions were held during a domain conference in June that attracts some
of the biggest players in this niche business.
One name -- creditcheck.com -- went for $3 million but paled in comparison to
the sale of sex.com, which sold for $12 million last year, according to Cahn,
who knew the site's buyer and seller.
Read full article at NewsFactor.com