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I was meeting some friends on Saturday and somehow we got to talk about domain names. It was probably me who started the topic, as always, but anyway… The point is, my friends were not easy to convince that domain names were actually valuable assets and relatively safe investments (if you do the necessary research). When I told them the usual arguments like “Domains have gone up in value faster than any other commodity ever known to man” (Thanks, Rick!), “Generic domains drive lots of type-in traffic to its owners’ web sites”, “Direct navigation traffic converts better than search engine traffic” etc., they said there was certainly truth in these arguments, but still they were not really convinced that domains were an investment as good as I claimed. So, I thought, how could I convince them? What would be the best way to explain to them that domains will continue to appreciate in value for many years to come? The arguments mentioned above are all true, but maybe they were just the wrong arguments for that audience. (I should note that most of my friends went to business school.)
After thinking a little while, I had the idea to back my claims up with plain and simple economics. Here is a summary of what I told them, including graphs I quickly drew on napkins that evening (now “excelized” for you ;)):
Continue reading ‘The Economics of Supply and Demand’
Seattle-based Marchex (NASDAQ: MCHX) is going to build a new network of “neighborhood blogs” under the ZIP code domain portfolio of the company’s MyZip brand, according to Justin Carder. Justin’s new job is to help Marchex create more local content and to monetize their local traffic domains. Marchex already owns the local content provider Open List and it will probably bring all its local content networks together at some point in the future. This is what Justin wrote on his blog:
What I’m most excited about is being able to help with #5 — too many great neighborhood blogs fade away because of some combination of lack of attention and lack of incentive. In my new job, I’m working for Seattle-based Marchex to create a system that gives people the tools they need to write great neighborhood blogs and the financial incentive for the writers and their communities to keep it going. For Marchex’s local search and advertising efforts, creating an environment rich with neighborhood content is good for business. For neighborhood bloggers, MyZip is the best way to create something that will last and not get lost in the swirl of life.
Justin also says that they’re going to start a trial for the Seattle-area now and they’re looking for bloggers who would like to write regular coverage about their neighborhood. Bloggers can register for the trial here.
[via Domain Name News]
Internet security company McAfee published an extensive report on domain typosquatting. The report analyses some example domains from different categories, takes a look at the increase in typosquatting and then proposes methods for combating typosquatting. I’ve said it before: typosquatting is a serious problem that investors of generic domains are facing, because they suffer from the bad public perception caused by cybersquatters. On the other hand, large corporations are monetizing typos and trademark-infringing domains, too. Earlier this month, I posted about Verizon making money from typos, for example.
From McAfee’s website:
Clearly, typo-squatting affects everyone who spends any time or earns their living on the Internet.
The surge in typo-squatting is contributing to whiffs of parasitism associated with the booming business of buying and selling domain real estate.
Some in the industry dispute the negative cast being given to domaining. A senior executive for Sedo, a major parking service, was quoted saying that “We want those pages to function as alternatives to search engines.”
To be clear, though, McAfee does not rate yellow a generic site like cellphone.com or typos of generic keywords like lirics.com. We reserve our yellow rating for typo-squatters of well-known brands, companies and sites.
Ultimately, in our view, typo-squatters fail the added-value test. Parked typo sites filled with pay-per click ads don’t help the consumer find the site he was actually looking for. And they don’t help the company build and brand their product in the way they see fit.
Sahar has done a good job commenting on McAfee’s report already, so I’m not going to write more about this, as I agree with what he’s saying. Click here for Sahar’s blog post on this topic.
Bill Sweetman of Sweetmantra attended the T.R.A.F.F.I.C. conference in Miami, FL in October. While he was there, he recorded some interviews with leading folks from the domain industry, namely, Monte Cahn (Moniker), Peter Lamson (NameMedia) and Jonathan Boswell (LeaseThis.com). You can download the podcast episodes from Bill’s website now.
Rick Schwartz has posted the true story behind his purchase of Flowers.mobi on his blog today, explaining why he decided to invest $200,000 in this one-word .mobi domain name. There have been lots of discussions about DotMobi on domain forums and blog in the recent weeks, including this post by Jay Westerdal which set off this week’s .mobi firestorm. (As it turned out, Jay’s research had not been accurate and he later apologized to Rick and Moniker.) Rick took all this as reason to provide domainers with the true story behind Flowers.mobi and gives insight into why he decided to purchase this domain, although it has been a risky investment.
So let me take you inside my mind over a year ago when I bought flowers.mobi. First of all I never registered a single .mobi domain during the sunrise period. My interest was not there until about a week before the auction or whenever Moniker announced the premium domain list. See, when I speculate with domains of ANY extension, I focus on one word domains or 2 very meaningful word domains. But if I am going to speculate on any extension other than dotcom, I am going to buy premium domains. So I decided to wait until the Moniker auction at TRAFFIC because that was going to be the first time that PREMIUM names with that extension would become available. I immediately picked flowers.mobi as the most valuable domain on the list and one of the premiere domains in the space should .mobi take off. So I decided before the auction I would bid up to $100k to get it.
Read the whole story here.
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