The inventory of good words and syllables on the Internet is running out. More and more investors are registering names with Internic (the organization responsible for Internet domain names), in order to sell the names later at prices that range from $200 to $50,000.
You may be asking: who would be willing to pay hundreds of dollars for an Internet domain name? As it turns out, there are such people. For instance, Mike O’Connor thought of a great domain name: television.com. The name has a long shelf-life and can be used in many variation such as kids.telelvision.com and sports.television.com and news.television.com. He expected networks and other television magnates to want the name and be willing to part with big bucks to acquire it.
Cnet, which has a leading computer industry Internet site, sent a representative to O’Connor with a $50,000 offer to acquire the name. O’Connor rejected the offer outright and is still waiting for a better offer.
Meanwhile Cnet had to make do with an alternative domain name. Cnet approached Internet Multicasting Service and bought the name www.tv.com from that company for a mere $30,000.
A domain name is a type of publicity, not just a question of honour. If a leading mineral water manufacturer wants more people to reach his Internet site than those of his competitors, he will fight for a domain like www.mineralwaters.com. It will be worth it to the manufacturer to be associated with the generic product name.
The inevitable conclusion is that there are those willing to pay serious cash for something virtual like a name. Not surprisingly, a gold rush has begun and entrepreneurs are running to Internic in order to invest in generic domain names in various areas in order to have a hold on the name in the hopes of selling it later. Initial investment is not great, just $150. These investors acquire buy dozens of names in advance, simultaneously taking several variations. However, one must remember that, like shares or bonds and other investment instruments, your domain name is worthless unless you can sell it later and make money on the deal.
How to Choose an Investment Name
It is important to think of names associated with fields which you believe have future growth potential. For instance, the year 2000 problem is a hot subject right now. With so many companies in the field right now, it is likely that a name like www.2000.com or some variation thereof would be in demand and have a high commercial value.
Other hot issues for domain names are electronic cash, investments, travel, etc. Most investors who have found a good domain name, make a list of synonyms, similar words and written alternatives, and register these as well.
How to Price Your Domain Name
As this is a very new industry, domain name prices can run anywhere in a very wide range. If you want to make a quick profit on the deal, you will have to set a realistic price, although less than $500 isn’t worth the trouble. If you think you have discovered a fantastic name, you can price it at thousands of dollars and just wait longer.
There are a few domain names whose owners have posted asking prices of $100,000 or more, although it is difficult to believe there will many companies willing to pay such high prices. To date, the most expensive deals in the filed have not been higher than $150,000.
How to Sell Your Domain Name
You can make the effort to sell the name yourself by creating a homepage and publishing Internet advertisements, or you can sit back, relax, and let others do the hard part. There are already eight brokerage companies active in this new industry which publish offered names, set up tenders and charge you limited one-time advertising fees of about $10. The companies then take a commission of 5-20% of the actual sale.
In order to learn more about the marketing process and the costs involved, check out sites like Best Domains and Web Space.
In the meantime, there is one organization that really is getting rich at dizzying speeds off the whole story, and that is Internic. Every month, thousands of new domain names are registered. Internic’s site has so much traffic it takes them two weeks to handle each new registration request. It should be noted that domain name registration is valid for two years, after which you are required to pay annual leasing fees of $50 to the same organization. Otherwise, you will lose the rights to the name.