Dispelling The Myth of the Domain Name “Queue of One”

[cc976a]

Perhaps we're getting in to the argument of domainers vs developers

Developers frustration is seeing names not worth in their opinion the price tag set and at £6 renewal fees a pop these names can sit around gathering dust for years not helping anyone.

Again if I go out looking for a one word generic term I expect to put my hands in my and bank managers pockets. What I begrudge is keeping hold of overpriced names because there's no incentive to push down to a Market price - like every other industry

 

[Sound]

You've completely missed the point of my article.

I was addressing a very specific complaint that I have heard repeatedly MANY times.

Although the wording may have been slightly different, the basic implication has always been that if we hadn't registered the domain name, it would be "free to register".

My contention is that is utterly false.

Regardless of the value we may be placing on it (which is a totally separate debate) it is beyond reasonable doubt that somebody else would have registered the name if we hadn't done so. And for some of the "stronger" names it's certain that they've been whois-ed hundreds or thousands of times by hopefuls who then gave up on the idea of registering them once they saw that the names were taken.

That is a totally different proposition from having hundreds of offers on a name, which is NOT what I said. I never suggested as much, nor did I imply anything like that.

All I am saying - and it's a valid, valuable point - is that the names would not be FREE TO REGISTER even if WE hadn't registered them!

I understand the point of your article just don't see that its a big deal and don't think its one of your better posts.

 

[Blossom]

Again if I go out looking for a one word generic term I expect to put my hands in my and bank managers pockets. What I begrudge is keeping hold of overpriced names because there's no incentive to push down to a Market price - like every other industry

Agreed - I have no issue with people selling domain names above cost value. You wouldn't expect to pay the original selling price for a house; likewise you wouldn't expect to pay the same for a 1 bedroom house as you would a 3 bedroom.

It's people hanging on to domains for years because they've set a completely unrealistic price that's annoying. Also people who deliberately register local business and small company names in order to try and sell them to them at a completely ridiculous price. One guy I spoke to recently wanted to sell the .com of a domain name for $250,000 when I bought the .co.uk for £150.

 

[websaway]

Agreed - I have no issue with people selling domain names above cost value. You wouldn't expect to pay the original selling price for a house; likewise you wouldn't expect to pay the same for a 1 bedroom house as you would a 3 bedroom.

It's people hanging on to domains for years because they've set a completely unrealistic price that's annoying. Also people who deliberately register local business and small company names in order to try and sell them to them at a completely ridiculous price. One guy I spoke to recently wanted to sell the .com of a domain name for $250,000 when I bought the .co.uk for £150.

Is this an actual example, you bought a co.uk for £150 and the .com is for sale at $250,000 because if it is I don't see where your gripe lies.

 

[Blossom]

Is this an actual example, you bought a co.uk for £150 and the .com is for sale at $250,000 because if it is I don't see where your gripe lies.

Yep it's an actual example. The name isn't worth $250k, it's worth £150 or less.

Another example is an iranian (.ir) name I wanted to buy from a different guy, emailed the guy and he wants $30,000 for it - it's not a product name, makes no sense in Farsi, and I had specific plans to use it as a URL shortener as it wouldn't make much sense to anyone else. Just saying that they could have sold either name at a reasonable price and still walked away with lots of cash. Names are still both dormant, and probably will be for the next ten years. There are too many people who hang on to domain names for years in the hope of a better offer, and they either end up selling at a loss or pay renewal fees forever.

 

[websaway]

Yep it's an actual example. The name isn't worth $250k, it's worth £150 or less.

Another example is an iranian (.ir) name I wanted to buy from a different guy, emailed the guy and he wants $30,000 for it - it's not a product name, makes no sense in Farsi, and I had specific plans to use it as a URL shortener as it wouldn't make much sense to anyone else. Just saying that they could have sold either name at a reasonable price and still walked away with lots of cash. Names are still both dormant, and probably will be for the next ten years. There are too many people who hang on to domain names for years in the hope of a better offer, and they either end up selling at a loss or pay renewal fees forever.

Well I like facts and I think it would be a good idea if you disclosed the .com you want to buy (asking price $250,000 ) which you think is worth £150 and the .co.uk you own which you bought for £150. The members can ponder the situation and we can debate a real situation which could prove educational.

 

[cc976a]

Doesn't anyone see the frustration - it would be like me trying to put my house up for sale for £50million, if I did it will still be up for sale 20 years time even though it has great transport links, great school nearby and village location around countryside.

May be ideal for someone else at the right price. Houses are easier to 'price' than domains granted. People here know even estimated what a domain could be potentially worth based on many different factors - even if a conservative estimate. We generally have an idea if something is grossly 'overpriced' based on it's potential (brands excluded).

It's never gong to change anything but good to get off your chest

 

[websaway]

Doesn't anyone see the frustration - it would be like me trying to put my house up for sale for £50million, if I did it will still be up for sale 20 years time even though it has great transport links, great school nearby and village location around countryside.

May be ideal for someone else at the right price. Houses are easier to 'price' than domains granted. People here know even estimated what a domain could be potentially worth based on many different factors - even if a conservative estimate. We generally have an idea if something is grossly 'overpriced' based on it's potential (brands excluded).

It's never gong to change anything but good to get off your chest

I go into a jewellers shop and I say I want to buy that piece of jewellery in the window for £750. The owner says but it's priced at £18,000. I say, I've been passing this shop for 7 years I look in the window every day and it's still there after all this time, you should accept £750 from me because I want it and you have not sold it.

 

[Edwin]

Doesn't anyone see the frustration - it would be like me trying to put my house up for sale for £50million, if I did it will still be up for sale 20 years time even though it has great transport links, great school nearby and village location around countryside.

A much better parallel might be people offering the owners of manor houses £100 because that's what they cost when they were sold by the Crown back in 1522 (or whenever they were first put on the market)!

Times have changed, and in "internet years" (they're quick, like dog years) we're hundreds of years ahead of the first tentative ecommerce fumblings of the early-to-mid nineties.

 

[Blossom]

Well I like facts and I think it would be a good idea if you disclosed the .com you want to buy (asking price $250,000 ) which you think is worth £150 and the .co.uk you own which you bought for £150. The members can ponder the situation and we can debate a real situation which could prove educational.

Would rather not because it's a project in progress but it's 2 dictionary words and an abstract phrase not a product, call to action or service. Whilst I would expect the .com to go for more than the .co.uk, it's not related to any industry in particular, and definitely not one where people would make enough money to justify the price. Nothing you could make money off type ins from. And the .co.uk was sold by an Acorn member previously, so whilst it may have been an ok buy, I don't think the price was crazily far out.

 

[websaway]

Would rather not because it's a project in progress but it's 2 dictionary words and an abstract phrase not a product, call to action or service. Whilst I would expect the .com to go for more than the .co.uk, it's not related to any industry in particular, and definitely not one where people would make enough money to justify the price. Nothing you could make money off type ins from. And the .co.uk was sold by an Acorn member previously, so whilst it may have been an ok buy, I don't think the price was crazily far out.

My point is that anybody can throw obscure examples into a debate and they can be misleading if not backed up by facts. Your claim was you bought the co.uk domain for £150 the owner of the .com wants $250,000 for the .com and you think it's worth £150 or less. You say it's a project in progress so can't disclose the name but not much progress expected by the sound of things. I'm sorry but your claims lack credibility.

 

[Blossom]

My point is that anybody can throw obscure examples into a debate and they can be misleading if not backed up by facts. Your claim was you bought the co.uk domain for £150 the owner of the .com wants $250,000 for the .com and you think it's worth £150 or less. You say it's a project in progress so can't disclose the name but not much progress expected by the sound of things. I'm sorry but your claims lack credibility.

I would have been happy to pay probably around up to £3k, expensive but worth it to me. Probably others would pay much more, but it would be hard to find anyone in the world who would pay $250k. I realise it's annoying that I can't disclose the name, but I'd rather not. It doesn't really make much difference, I don't have an incentive to lie. A comparable name would be something like artistictwist.co.uk (hmm, that's free to reg). Potential, but not $250k potential.

Not much progress expected? It could go either way I suppose, unfortunately I don't have as much time as I'd like. I'm now relying on the .com not being developed, which isn't ideal, but I won't be giving up on developing the .co.uk any time soon.

EDIT: Should probably have clarified that the .com had no site attached it.

 

[Edwin]

Earlier, you said...

Yep it's an actual example. The name isn't worth $250k, it's worth £150 or less.

But then you said...

I would have been happy to pay probably around up to £3k, expensive but worth it to me. Probably others would pay much more, but it would be hard to find anyone in the world who would pay $250k.

So it's a name that's simultaneously worth £150 or less, but also £3,000 to you, and also (probably) "much more" than that to others. I'm not sure how that contributes anything to the thread.

 

[Blossom]

Earlier, you said...



But then you said...



So it's a name that's simultaneously worth £150 or less, but also £3,000 to you, and also (probably) "much more" than that to others. I'm not sure how that contributes anything to the thread.

I have separate valuations of worth: one which is what I personally would pay for a site, and one which I believe the general consensus is (i.e. closer to a broad market valuation). Obviously there would be the odd one or two outside these levels, so consequently it would be a scale.

- Reg fee
- Bargain [< £150 in this example]
- Average price [£150ish]
- Overpriced (would pay if absolutely had to, but would feel a bit ripped off) [up to £3k]
- Highly unlikely to ever sell (unless a company is desperate enough) [£250kish]

I didn't really clarify enough, sorry. I don't work on the sell/not sell thing.

 

[Skinner]

Without going into too much detail, I can provide an example of it working the other way around.

A ex-client purchased a cat-killer health related .co.uk off a domainer (didn't know was an acorner at the time) for low x,xxx. Once this was purchased, I contacted the .com owner expecting 3-5x higher price coz its a .com. Instead they came back with a typical yank mid-$XX,XXX-USD figure, I said sod that, offered high-x,xxx via sedo hoping it would be pushed to auction and I'd bag the name. They rejected and killed the banter.

Well now several years later, the .com name sold recently via sedo for mid-£xx,xxx-GBP so achieved higher than they asked for years ago.

So the waiting game with a sky-high price CAN work out.

Edited: Removed TMI, and went more vague, as I realised it was easy to locate, and its not my place to identify. The ex-client no longer owns the name, no idea why.

 

[cc976a]

I go into a jewellers shop and I say I want to buy that piece of jewellery in the window for £750. The owner says but it's priced at £18,000. I say, I've been passing this shop for 7 years I look in the window every day and it's still there after all this time, you should accept £750 from me because I want it and you have not sold it.

Not quite. Back to the house analogy - that would be like saying a 3 bed house down a road where the average selling price is £200k - and you have up for sale for £200k - then someone comes along and says look you should sell me this for £20k because you haven't found a buyer.

All comes down to a question of 'worth'. As many people point out a domain is only 'worth' what someone is prepared to pay. A domain sitting on a shelf for 7+ years with a price tag of £50k but has received quite a few offers of around £500 is probably worth about £500 (the price someone is willing to pay).

Maintaining your name is work £50k which no-one wants to pay is a waste of a name that could be put to better use.

 

[domainseller200]

I go into a jewellers shop and I say I want to buy that piece of jewellery in the window for £750. The owner says but it's priced at £18,000. I say, I've been passing this shop for 7 years I look in the window every day and it's still there after all this time, you should accept £750 from me because I want it and you have not sold it.

A much better parallel might be people offering the owners of manor houses £100 because that's what they cost when they were sold by the Crown back in 1522 (or whenever they were first put on the market)!

Times have changed, and in "internet years" (they're quick, like dog years) we're hundreds of years ahead of the first tentative ecommerce fumblings of the early-to-mid nineties.

These two comments sum it up perfectly for myself and totally how I see it also

 

[cc976a]

A much better parallel might be people offering the owners of manor houses £100 because that's what they cost when they were sold by the Crown back in 1522 (or whenever they were first put on the market)!

Times have changed, and in "internet years" (they're quick, like dog years) we're hundreds of years ahead of the first tentative ecommerce fumblings of the early-to-mid nineties.

Not really. If a this manor house (say retail wise should have a value of about £500k) went for £100 the demand be enourmous. If it went for £50k it's going to have a massive amount of interest. If it goes up for £400k it's going to have some interest.

Then hits at £800k and demand is probably small. Put up for £5million and your demand has gone.

I think the frustration is names that are probably 'worth' £500k are up for £5million without a sniff of demand at that level.

@Edwin - it's not a dig at you. You have the brand Memorable Names because that is what you hold (or at least what I have seen). Names where brands can be born from and market that exist, this sets the value and the demand. Nothing wrong with that.

 

[sorlag]

As many people point out a domain is only 'worth' what someone is prepared to pay. A domain sitting on a shelf for 7+ years with a price tag of £50k but has received quite a few offers of around £500 is probably worth about £500 (the price someone is willing to pay).

Yes the problem is that many domainers do not sell at market value. If no offer above £500 has been received in years, then my offer of £1000 should be good enough.

But domain seller has a monopoly and can exploit eg. that domain may match my business name, or time I’ve invested into thinking of a suitable domain / idea combination.

The ‘monopoly’ enjoyed by a home or car seller is much less brutal – similar alternatives are easier to come by.

PS. A domain is worth what someone is prepared to pay, but fair value is just above whatever the second highest bidder will pay.

 

[retired_member34]

A much better parallel might be people offering the owners of manor houses £100 because that's what they cost when they were sold by the Crown back in 1522 (or whenever they were first put on the market)!

Times have changed, and in "internet years" (they're quick, like dog years) we're hundreds of years ahead of the first tentative ecommerce fumblings of the early-to-mid nineties.

Whilst I understand the wish to use the property analogy, it isn't a perfect one for a couple of reasons that I can see.

One, the market is not liquid, there are far more sellers than buyers. If I owned the said manor house I could put it on auction next week and achieve a good high percentage (say 75%+ for arguments sake) of the price I could achieve if I marketed it properly and with patience. The same is true if I held a portfolio of 100 manor houses, I could find a trade buyer in a short time and achieve a good percentage. The same does not hold true of your portfolio of domains (as you have stated yourself in the past).

Secondly, domains are not investments so much as speculation (note both can lead to great profits, but there is a difference). If I bought the said manor house at auction and had absolutely no use for it I could get an income from it quite easily, by renting it out. There exists a ready market for property rental, with no skills required as there are many providers that would do everything for me. The same is true if I bought 100 manor houses. Even if I do not gain income there is a large enough market that I can have a good idea of it's likely sales price at any time, and decide whether to hold or sell. However domains have no such easy route to income, nor a trackable value.

So to extend your analogy somewhat, I think the internet is still in the wild west of property development. Pay a small fee to a local body and you could have your patch of land. If you could afford it there was nothing to stop you buying thousands of patches of land, either directly or on the secondary market. Some registered land that quickly became valuable due to gold or oil making them money very easily (think top end generics in financial industry). Others registered land that became valuable due to their own hard work, farmers or industrialists perhaps (think top brand names). Others again registered land that became valuable over time, purely because that cheap patch of mud ended up in the centre of a city or tourist area. These however became valuable gradually over time and most changed hands many times. This last section is how is how I see most middle level generics. Right now we do not know where the internet "cities" will be. If G (or FB, or whoever comes next) means that holding a generic gives no value whatsoever then you will be holding land in the centre of a desert. If however the custodians of search decree that it becomes more important, then you are going to be a Duke of Westminster. As you cannot know which way it will go (however much you believe it), then fundamentally domain holding is speculation.

All IMHO of course, without a crystal ball it really matters not a jot what any of us think or believe, but interesting none the less.