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Don’t Mess with Verizon, Motorola, and Lucasfilm

Elliot Silver
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9

Just about every time a big company announces the launch of a new product, people buy related domain names for a multitude of reasons. Some buy them with the hopes of selling them to another company, others want to capitalize on potential popular typos, and yet others want to offer services, forums, special offers or other information related to the product.

On November 8th, Verizon Wireless began selling the Motorola Droid, a new smartphone that has had a whole lot of positive press and reviews. I’ve seen dozens of commercials for the Droid (if not more than dozens), and they seem to be directly taking on the iPhone and other smart phones. Needless to say, the Droid will be in high demand, and people will think they can make money by buying and selling Droid domain names.

However, with this particular trademark, you really need to be very careful of the usage of related domain names. On the bottom of Droid-related pages on Verizon Wireless’ website, there is a legal notice, “DROID is a trademark of Lucasfilm Ltd. and its related companies.”

By registering domain names with the term “droid” in it, you will probably be stepping on the feet of Verizon, Motorola, and Lucasfilm. Keep this in mind in the event that you think you might be able to make money with this mark. Obviously there are way to use “droid” in a domain name without potential liability, but I am sure there are plenty of people who don’t realize the risk of owning these with the intent of profiting off of the Droid mark, by selling, parking, or otherwise monetizing phone-related Droid names.

Piece of Advice Before You Develop

Elliot Silver
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10

It’s a beautiful (but cold) Saturday in New York City, and I want to head out, so I will keep this post brief. Before you develop a domain name into a website, you should map out your 3, 6, and 12 month plan for the site. I didn’t do this on a few of my websites, and I am regretting it.

With my geodomain names, I did not build them on a content management system (CMS) like WordPress or Joomla. I didn’t have the expertise and didn’t ask the right questions. I gave direction like I knew exactly what I wanted, and I got exactly what I asked to have built. Basically every time I want to add a page of content, I need to do it in Dreamweaver and then make a few tweaks on other related pages, sitemap, home page…etc. With a CMS like WordPress, it would be automatic. Instead of taking 15 minutes to post an article (not counting the writing part), it takes 5 minutes. My bad. You don’t need to make the same mistake.

You should also think about how often you plan to work on the site and add content or business listings. If you want to be hands-off, you should use a platform that will allow others to add their listings (for a fee or free) where you can simply moderate it. I didn’t do this on my sites, so this is a struggle. I get listing requests practically every day, so it’s a lot of additional work for me. It isn’t difficult, but it can be time consuming.

One reason you need to think about where you will be in a few months and/or even years is that development can be expensive, especially. However, if you go about it the wrong way, it can be even more expensive and anxiety-provoking down the road. I am very thankful this blog was built on WordPress because it’s pretty easy to make changes to design, advertising, and even the SEO is practically done for me with a few plugins.

It’s essential to consider the amount of revenue you can derive from your site when you are making your plans. If you don’t really think people will pay for listings or advertisers won’t pay to be on your site, you should reconsider development. It can be expensive, and if you don’t really have a business plan, it can be a huge waste of money for you.

Because of the lack of knowledge I had when I started, I have to make a decision about whether to use a CMS on my geodomain names and then import all of my content, which will be a tedious and time consuming (expensive) job. Eventually I will get around to doing it, but there are other decisions and ramifications that will result.

The newest site I am working on will be an automated directory and should have limited online involvement from me. I’ve learned my lesson and gained enough knowledge, which I hope can help you as you develop.

Define Your Business Goals

Elliot Silver
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0

I think one of the most important things you can do in order to achieve success in this business is to define the goals for your business and set milestones to achieving your short and long term goals. Think about the question, what would you like to accomplish in the domain investment business?

If you are looking to buy and sell domain names as a hobby, you can probably forget all about mini sites and web development. You will end up spending a lot of money on things that are unnecessary. Keep abreast of domain news, trends, and threats to make sure your business model is evolving as necessary. Continue buying good names for good prices, and do what you can to keep your costs and overhead minimal.

If you see yourself being involved in the domain business full time at some point, I strongly advise you learn about web development and SEO from non-domainers (similar to what Alan said). I may be able to share a little bit of knowledge about web development, but you really need to learn about that stuff from experts. I can help you with domain names, and I can share the things I am doing with you, but when it comes to web development, programming, SEO and other technical things, I am just learning, too, and the best advice I can give is to do what I did and research the smartest people in those fields and learn what you can from them.

For me,   two years ago, I realized that it might get difficult to make a good living (for my career) simply buying and selling domain names, so I opted to go the development route. I’ve made plenty of mistakes along the way, but I’ve also done some things right. Fortunately, the domain sales business has remained pretty good, and I have built value on many of my development projects, but I am constantly refining my plans and path for the future. It’s critical to keep your eyes focused not only on the things that are right in front of you, but also on things that are going to happen down the road.

Think about it for a minute. On domain forums, blogs, news sites, corporate sites…etc, every person and company situation   is different. Some people do this as a part time hobby, others do this full time because they were smart enough to register great names many years ago, and yet others are somewhere in the middle. There are people living in high tax areas and people living in tax havens. Some people are married and have kids, while others are in college or high school. We all are in different situations and what one person does has no bearing on what others should do.

How you see yourself in the future as it relates to the domain space is important, because you need to do things now to accomplish your future goals. Take some time to figure out where you see yourself and do what it takes to get there. Everybody has a different path and a different road map. What’s good today may not be good tomorrow.

Registering ccTLD Domains Under the Guise of Brand Protection

Elliot Silver
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9

I won’t call this a “scam” email because I don’t think it meets the definition of scam, but I’ve received a number of similar emails and wanted to share it with you. Clearly, it looks like the objective is to get me to register a bunch of ccTLD domain names I probably would not have wanted, under the guise of brand protection.

The initial email stated:

Dear CEO,

We are the department of registration service in China. we have something need to confirm with you. We formally received an application on November 2, 2009, One company which self-styled “NOA INDUSTRIAL LTD” are applying to register “burbank” as brand name and domain names as below:
burbank.asia
burbank.com.hk
burbank.com.tw
burbank.hk
burbank.net.cn
burbank.org.cn
burbank.tw
After our initial checking, we found the brand name and these domain names being applied are as same as your company’s, so we need to get the confirmation from your company. If the aforesaid company is your business partner or your subsidiary company, please DO NOT reply us, we will approve the application automatically. If you have no any relationship with this company, please contact us within 10 workdays. If out of the deadline, we will approve the application   submitted by “NOA INDUSTRIAL LTD” unconditionally.

Best Regards,
Alan jin

After receiving this email, I replied that the “applicant” is not affiliated with my company. Their reply had a more direct sales pitch, as expected:

Dear sir,

Many thanks for your confirmation.As soon as receiving the application of “NOA INDUSTRIAL LTD”.we checked and found “burbank” is your company’s registered trademark.So we inform you also that’s reason why we sent email to you.If you did not authorized such apply we suspect 2 points:

1. This company uses your brand   to build market in Asia.
2. This company may be doing your same business, or your competitors.

But you should know that The domain names regisration is open in China. so “NOA INDUSTRIAL LTD” has right to apply for the available domain names. For this reason ” NOA INDUSTRIAL LTD” is also licit applicant and we have no right to reject them.You only own the preferential rights to register them.

In addition.please inform us your company’s decision of this issue. if these domain names are important to your company.we can send you a dispute application form and help you register them. If these are not important.we will accept “NOA INDUSTRIAL LTD’s application. Thanks for your understanding.

Best Regards,
Alan jin

The emails look official, and some companies might worry that their brand mark could be abused. Just a head’s up that I’m not buying it, and I would bet if I check in 6 months from now NOA Industrial will not own Burbank.whatever either.

Don’t Buy Brandable Trademark Domains!

Elliot Silver
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12

A few days ago, I received an email from someone who is new to the domain industry who asked me for my opinion on some of his 200 domain names. He started out buying domain names in the past year, and probably has spent in the ballpark of $2,000 on his domain investments. I won’t reveal any more details about the person or his names because the details don’t really matter, but most of his names were call to action domain names involving trademarks.

In the email to me, this person mentioned Rick Schwartz’s sale of iReport.com to CNN as a reason that he registered some of the names. I replied to this person with my advice, and I think it could be beneficial to others who have similar names or have considered purchasing similar names.

“The reason Rick sold iReport.com to CNN for so much was that they had already created the brand on their site, and they needed the domain name to expand.   Rick didn’t buy ireport.com to sell it to them, or else they probably would have sued him rather than try to buy it.

As someone who worked at an ad agency for a couple of years, I can tell you that creative directors love coming up with their own ideas, and they would probably not use a slogan that someone else created.   [XYZ Company] probably has an ad agency of record and doesn’t do their own campaigns (although they approve them).

I personally stay away from all trademark related names, because they can be much more trouble than they’re worth. Some people justify buying those that make money with parking pages by making a business decision (revenue outweighs risk). That’s not my game, and I highly doubt any company will pay for a name using their TM if it doesn’t mean anything to them.“

In my opinion, newly registered domain names that contain the name of a popular or well known brand are not of value and can be very risky and have little to no reward whatsoever. Many companies protect their brand names fiercely, and it’s not very likely that a company will buy worthless domain names from a cybersquatter.

While lawsuits involving trademark domain names are more rare than UDRP filings, I would say the likelihood of selling a blatant trademark name that you just registered is probably just as likely as a lawsuit.

How Do You Value a Domain Name?

Elliot Silver
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10

This morning, I wrote a post about the launch of Valuate.com, an automated domain valuation website. Over the years, people have discussed the process of placing a value on domain names, and I tend to say (as well as others), “a domain name is worth what someone will pay for it.”

Perhaps this isn’t entirely accurate, because it’s impossible to gauge what anyone would or could pay for a particular domain name. There are many things to consider, and perhaps my statement is too much of a generalization?

It’s known that I don’t trust or generally believe professional appraisals, as they are almost always biased. When someone tells me they have a professional appraisal for a domain name that I am trying to buy, I generally reply by saying something like this:

“I don’t believe that appraisals can be accurate for a number of reasons. It’s in the appraisal company’s best interest to make the appraisal very high, as they hope to have repeat business.   If they gave you an appraisal of $200 and you had 50 other names that needed appraisals, would you return to that company? It’s much more likely that you would return if they told you that your name was worth $15,000.

I think it’s impossible to say what a name is worth officially, because you might be able to get much more than I am offering for the domain name eventually, but that isn’t a given and that day could also never come.”

The point I try to make by stating this is that the value of the domain name should be what I am willing to pay for it, and if they are still talking to me, they obviously have never had a higher offer. They can either take the opinion of a company that is making 100% margin on a domain appraisal and wants more business, or accept the cash offer I made.

In any case, the real question here is how do you place a value on a domain name?

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