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$500,000 Offer for LI.com

Newsday is reporting that the Al Triolo, owner of LI.com has received a $500,000 offer for the name through Sedo.

Domain names dominate Internet real estate

I would love to have the luxery of passing on a half million dollar offer, but I believe this name is worth more than the offer. Two letter domain names are the rarest .com names availavle (676 total), and on the rare occasion that one comes on the market, it is usually of lesser quality, and those are usually sold for over $100,000.

Most two letter .com names are fully developed and associated with businesses, such as JR.com, BA.com, and NV.com. I think the owner should hold out for an offer that fully values his domain name, and that would probably be over $1 million.

Possible Liability for “Holding” Domains

Are domain registrants unknowingly taking risks with their domain names if they aren’t parked or developed? Registrars like Godaddy and Network Solutions frequently put up landing pages with Pay Per Click (ppc) links, unbeknownst to the domain owner, when the domain owner doesn’t change the DNS after purchase. These links are frequently related to the subject of the domain name which could potentially pose a problem for domain registrants – especially if the domain may have trademark issues.

Take the domain name SuperYachts.com for example. The name is registered with Network Solutions, and the registrar is serving up ppc links for “Charter A Luxury Yacht,” “Private Yacht Charters,” and “Yacht Brokerage” among others. To my knowledge, the owner of this domain name is not receiving any compensation for any revenue generated by clicks. Since this domain name is fairly generic, there probably isn’t much risk with Network Solutions serving related advertisements, although I don’t believe it is right that they may not be sharing the revenue with the domain owner. I liken this to my last trip to South Florida where a person was charging people for parking spaces in a bank’s parking lot hours after the bank closed. I am sure the money he made from this endeavor was not shared with the bank!

In the case of a domain name like VoteBarak.com, the domain registrant could be opening himself up to a legal issue because Godaddy is serving ppc advertising. Although most of the ppc links are Barak Obama-friendly, one could be considered not so friendly – “Ann Coulter’s Column Free.” While some people may say it is perfectly legitimate to own a name like this, when a registrar serves advertisements, thus generating revenue, they may be putting the registrant in a precarious position. Since the law allows a registrant to own a name like this to voice his First Amendment right (fan site, anti-person site…etc), when revenue is being generated based on the famous person’s notoriety, a WIPO panel may see this as bad faith.

A worse situation is in the case of the domain name GoogleScores.com. This obvious TM is registered at Godaddy, with the registrar serving up advertising for various credit score links, piano score links, and even a link to “Free Google Software,” with a link to a Google-owned entiy. Whether the owner knows that this is happening or not, he is certainly opening himself up to potential liability in the form of a ACPA lawsuit or WIPO.

Registrars probably make millions of dollars annually from all the random domain names that have never been parked or developed by the owners but have ppc links served by the registrar. I would guess that many of these names are TM names that people new to the domain name business registered without knowing the laws about cybersquatting and are holding them rather than developing them. This problem may be hidden to them, could pose potential liability issues for them, and it would appear that registrars like Godaddy and Network Solutions are able to reap the reward without any of the risk.

Domain Roundtable Auction Preview

Jay Westerdahl and the Domaintools staff has released the preliminary list of 450 domain names scheduled for the Domain Roundtable auction on August 15th, in Seattle, Washington. Judging by the massive amount of comments on the various blog threads written by Jay, I would imagine that they received close to 100,000 domain name submissions from which to choose 450. As I posted in the comments section of the Pick The Winning Domains thread started by Jay, I was baffled at the comments from people who submitted their names. Just based on the sheer amount of comments (and presumably emails, too), Jay and his staff certainly had their hands full.

What were people thinking by submitting hundreds of domain names, when the auction was going to only include 450? If a person can’t pick out their top 10-20 names (maximum), they probably should be investing their money elsewhere. Needless to say, the preliminary list has been released, and here are some of my thoughts:

Great Names – Low Reserves!
Event.com – $165,000
DailyFeeds.com – $3,000
Rehabilitate.com – $25,000
RealityTelevision.com – $1,000
Growers.com – $25,000
(All of my names, but don’t have a need to over-sell them)

Great Names – Reserves Way Too High!
Sucker.com – $70,000 (Cool name, but not for $70k)
Technique.com – $149,000
Magicians.com – $200,000 (Unless David Blaine attends, no magician is paying $200k for this)
Baked.com – $75,000 (If the response to this on Ebay is an indication, it’s priced way too high)
Sculpting.com – $120,000 – (Good name, but I don’t see any artists shelling out big $$ for this one)
Autobiography.com – $179,000 – (Maybe the plural would be of interest to a book seller, but I can’t see the singular going for this price)
LoveStories.com – $100,000 (No side or top advertisers on Google for quoted phrase, Ovt with extension of only 149, and a $100k sales tag? Pass.)

Head Scratchers at Any Price?!
Rejuvinate.com/Rejuvinates.com – (How can you have a TYPO in a live auction?)
AquariumFishes.com – (Since when was “fishes” an acceptable term)
Concho.com – (Names needing a definition as a note shouldn’t be included)
GamesFlix.com – (Less than 50 results on all of Google for this term)
ComplaintsDept.com – (Maybe ComplaintsDepartment.com would be ok…)
CareerAdvise.com – (CareerAdvice.com would be good – CareerAdvise.com, not so much)
SkiSeattle.com – (Since when do people ski in Seattle?)
PizzaHats.com – (What is this?)
HummerRentals.com – (Isn’t selling a TM proof of bad faith?)
DomainsName.com – (This is a case where an extra letter kills all value)
SexualOrgasm.com – (Is there another kind of orgasm with which I am unfamiliar?)
BibleDude.com – (Ummm… no)
20Percent.com – (What’s special about 20%?)
ChinaDaddy.com – (Unless I am missing something, this isn’t good)
SevenSmiles.com – (Hmmm seems like a typo of SevenMile.com – not good)
FullClock.com – (What’s a full clock?)

I don’t see as many huge names as I have seen at TRAFFIC, but most of those seem to end without a sale. There are many decent names at reasonable prices, so I expect to see a good amount of names sell. Making it through 450 names in a live auction is very optimistic though.

While I wish Jay the best success with this auction, I am somewhat concerned that he will not be able to fulfill all sales. Without an agreement signed by the sellers, there is little that will force them to sell should the prices be less than they want, or should they sell elsewhere. I hope this issue is addressed between the time the list is finalized and the day of the auction.

Optimizing Names That Are “Too Generic”

Choosing how to develop a high value generic domain name can have pitfalls if the name is

Boston Globe: Virtual Brokers Yield Real Profits

Nice article about domain investing in the Boston Globe today:

Online Domain Name Game Yields Real Profits for Virtual Brokers

It’s always nice to see a positive article in the mainstream media about domain name investments and why companies are paying large sums of money for them. It’s kinda crazy to think about how Beer.com went from being sold for $80,000 to $7,000,000 in less than 4 months. It goes to show you that many generic domain names have considerable value – it’s just a matter of finding the company that values it highest.

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