I feel the biggest hurdle to considering domain names as legitimate assets is how discretionary (random) prices are. In 2010, you could find two-letter .com domains that sold for around $100,000 (JF.com, XI.com and SZ.com) and one domain for $8 million (FB.com). That is an 8,000% difference! – Giuseppe Graziano, GGRG.com
Despite two decades of conventions and commerce, domaining is still in the latter part of its Wild Wild West stage. Why? Well one reason is because the market is so fragmented. There are at least a dozen different marketplaces all with different rules, terms and procedures. Until there is a centralized organization that all markets report to and that requires an agreed upon, standardized set of rules and conditions, for all transactions, that will remain the case.
Disruption and manipulation
In addition, we have a crude and inept ICANN and UDRP process, new registrars and TLDs popping up every month and companies like Estibot and GoDaddy providing incomplete and inadequate valuations despite their best efforts. In a word, our market is chaotic and unpredicatable. Most domains are simply worth what one buyer is willing to pay. This means that, among other things, our industry is vulnerable to disruption and manipulation and remains extremely speculative. That kind of instability is a major deterrent to even the most adventurous of mainstream investors.
Don’t get me wrong
I’m not trying to disrespect anyone or any organization. In fact it’s just the opposite. I am very grateful to the people and organizations that have developed the industry over the past twenty odd years and who have afforded me the opportunity to make a very significant part-time income.
In particular, I have great respect for companies like NamesCon, Estibot, DomainSherpa, NameBio and BrandBucket who have been pioneers in their respective areas and have brought a measurable amount of stability and dignity to an otherwise chaotic marketplace. ShortNames and Expired.net are two more aggregation sites that in my opinion deserve applause and praise, not to mention Escrow.com and several others.
What’s in the future?
When stability and uniformity do emerge I think they will be seen first in the area of short, liquid domains. Why? Because this is the most highly organized and standardized section of our industry thus far. I’m very impressed with the work of Giuseppe at GGRG.com who, in conjunction with other significant players in our business niche, have broken new ground and made clear efforts to quantify domains and their markets.
Lastly, I have to explain that I’m waxing a little prophetic here because this is going to be my last blog entry on DNG for a little while. I need to take a few months and devote a little extra time to both my personal life and to my portfolio and there are not enough hours in the day. When I do come back, after a break, I plan to be mostly in the role of a periodic, guest blogger, rather than a weekly contributor.
Over the past year, I’ve tried to share what I’ve learned as I’ve progressed from newbie to journeyman domainer. I hope it’s been helpful and that the body of work I’m leaving behind serves as a resource for those new to this rather insane but equally intriguing, moneymaking endeavor.
I sincerely and deeply appreciate the continued support from all the readers here at DNgeek. You have been both kind and encouraging. In particular, I give a big shout out to Doron who has been such a great inspiration, mentor, and friend to me over these past many months.
Have a great summer everyone!!
This week’s brandable opportunities at NameJet include:
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