If It's Such A Hot Domain Market, Why Isn't Anyone Using The Hot Domains?

from the just-wondering dept

Tue, Jan 16th 2007 3:39pm — Mike Masnick

There have been plenty of stories recently about how the domain squatting and selling market heated up in the last year, with some domains selling for surprisingly high prices. However, it looks like for the most part, it remains a purely speculative market. Search Engines WEB writes in to point out an article noting that of the 20 largest domain purchases in 2006, only one is actually being put to use. Most are just parked, with the owner perhaps hoping the market will get even hotter for resale. While domainers seem to want to believe the market is similar to traditional real estate, the fact that most of these "hot" domains don't seem to be put to good use suggests that people are realizing that a good domain isn't everything. Marketing some new name can be a lot more effective -- which explains many of the oddly named companies you see these days.

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21 Comments

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zeromus, 16 Jan 2007 @ 4:16pm

I used to be firmly in the camp that thought a non -.com domain was worthless.

Recently, I have become a fan of the new style non-www addresses with odd tld.

Clearly owners of high value trademarks will want the .com for defensive purposes, but for creators of original content, a .com is less valuable to the degree that folks like me are less likely to view a non-.com as secondrate.
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- John, 16 Jan 2007 @ 4:26pm
  
  Re:
  The problem isn't people thinking a non .com is second rate or not as good. The main problem is marketing. Through advertising (word of mouth, newspaper, etc) people will remember the name but many assume all pages are .com and will just go to that name.com looking for your site. Even with online advertising, if they don't bookmark the link when they try to go back many will assume .com. The more tech oriented ones will web search or remember it was .biz but basically your marketing is driving traffic to someone else's site.
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misanthropic humanist, 16 Jan 2007 @ 4:30pm

valuable domains? I don't think so.
It was fun in the 1990s, but yeah, domains have never been analogous with real-estate and while a few people made a killing on some choice domains early on the market has changed. I frequently see domains that I once desired left abandoned now.

Combinations with repetition on the alphabetic set give us, for 4 letters,
(n + r - 1)!/r!(n-1)! = (26+4-1)!/4!(25!) = 8.841762e+30/3.722690e+26 = 23751

Given most are fairly undesirable lets say there's a couple of thousand good 4 letter combos.

but for 10 letters, and not including numbers we have 1.835794e+08 = 183,579,400 or about 200 million

So, multiply that by the top level domains
http://en.wikipedia.org/wiki/List_of_Internet_top-level_domains
I count about 270, let's call that 300

or about 60 billion possible 10 letter domains.

Assuming 80 percent are useless we are still left with 12 billion good ones.

Now, how many "hot" domains (apart from google, yahoo, sex, myspace and so on) can you think of?

That's without numbers or the full UTF-16 char set by the way.

People have realised it's not worth paying for a "hot" domain. They are really just curious trophies. Anyone with a serious business plan would just invent a name that's free to fit their new company.

btw, I love the word domainers Mike. :)
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Justin Mooney, 16 Jan 2007 @ 5:20pm

Heres why they are parked
Everyone is buying and parking because they are trying to make adsense money from the traffic that is typing in that domain name. Some do VERY well with this.
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- E Estrella, 17 Jun 2007 @ 4:17pm
  
  Re: Heres why they are parked
  bingo! i agree 100%... parking is what is hot. not the development of cool domains. The hot domains are those that get web traffic.... just for giggles... try a web search on two domains,,, go-disney.com or
  JG-Wentorth.com.... These two examples will show you what i am talking about.... you will find those two domains at the top of the google web crawler.. why? because whoever owns the domains thought outside of the box.
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  - E Estrella, 17 Jun 2007 @ 4:18pm
    
    Re: Re: Heres why they are parked
    sorry, i meant JG-Wentworth.com
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- E Estrella, 17 Jun 2007 @ 4:20pm
  
  Re: Heres why they are parked
  bingo! i agree 100%... parking is what is hot. not the development of cool domains. The hot domains are those that get web traffic.... just for giggles... try a web search on two domains,,, go-disney.com or
  JG-Wentworth.com.... These two examples will show you what i am talking about.... you will find those two domains at the top of the google web crawler.. why? because whoever owns the domains thought outside of the box.
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Sal, 16 Jan 2007 @ 5:28pm

It's amazing many people in the online tech arena have no clue about the domain game, like you.
Keep thinking the way you are, just more possibilites for us who figured it out long ago.
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Mike Burda, 16 Jan 2007 @ 5:29pm

Computation
Mr. Misanthrope,

Would you mind explaining your computation? I am not questioning it, I simply want to better understand.

In return, I promise to use the term "domainers" as often as is possible.

Sincerely,

Mike
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Sal, 16 Jan 2007 @ 5:35pm

"People have realised it's not worth paying for a "hot" domain. They are really just curious trophies. Anyone with a serious business plan would just invent a name that's free to fit their new company."

And what if the DOMAINS themselves ARE the business plan, like having many of them which provide natural type in traffic? That is what most portfolio owners do.
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SkepticBlue, 16 Jan 2007 @ 7:12pm

By the numbers
I'll question those numbers:

With repetition allowed, alpha only, there are 26^4 four letter domain names available = 456,976. With alpha, numeric and 4(?) marks, it's really more like 40^4 = 2,560,000.

It increases exponentially ;-) with 10 characters: 26^10 = 1.4 x 10^14 for alpha only and 40^10 = 1.0 x 10^16 for all of them.

These aren't combinations, they're permutations -- order counts.

Throw in the TLDs (270) and you're up to 3.8 x 10^16 alpha only 10 letter domains and 2.8 x 10^18 alpha/numeric/mark domains.

And that's only using the common english symbols.

Of course, most of these are gibberish in any language.
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PhysicsGuy, 16 Jan 2007 @ 8:10pm

don't forget you can have (from what i can gather) up to 63 characters in a hostname excluding the tld. 40^63 = 8.507x10^100 possible hostnames.

just to let you know, i've already trademarked aaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaa
so back off :P
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|333173|3|_||3, 16 Jan 2007 @ 10:57pm

Odd names
IF you think about the names of plenty of major web companies/sites they tend to have names which would be considered unusual: Think of MSN, yahoo!, google, Wikipedia, &c., but no-one thinks about it. THe name has just become accepted as the name of te site, and all that has to be done is to choose a name which people can spell, and if your business is good enough, that should be enough. Also consider whirlpool.net.au, an important site about broadband providers, but you could never guess that from its name.

I agree that www. should be abandoned, since it is no longer needed, but the idiots and dinosaurs out there would probably get confused if there was not at least a redirect tag on the www. page.
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Anonymous Coward, 17 Jan 2007 @ 12:28am

Re: Odd names
"I agree that www. should be abandoned, since it is no longer needed"

has it ever really been needed?
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misanthropic humanist, 17 Jan 2007 @ 2:20am

exhaustive domains set
Hey Mike,

Don't be put off by the style and "level" of this site, mathisisfun.com is a great resource with clearly researched examples.

http://www.mathsisfun.com/combinatorics/combinations-permutations.html

Perhaps I should read it more, as SkepticBlue correctly points out I have made the spectacular error or using the combinations formula where I should have used the permutations formula. So, in fact there are even more possible domains than I claimed.
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David, 17 Jan 2007 @ 3:32am

Math Is Fun
You're right, the style of that site is garbage, but the content is fantastic. THANKS!
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Brian A., 17 Jan 2007 @ 8:54am

Abandoned WWW
"I agree that www. should be abandoned, since it is no longer needed"

It's true. Luckily things like Google Sitemaps allows you to specify your preferred domain. PageRank is still a little kooky and thinks that they are two different sites for some reason, but it's a start.
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Daiski, 17 Jan 2007 @ 10:30am

.com is default for many
I run a site that's .info but have also bought the .com and forwarded it. It has brought more people to my site especially since the actual domain name is so suggestive of the site.
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Techie112, 18 Jan 2007 @ 1:39pm

Whoa you just don't get it..
I recently offered the owner of a parked name $120,000 and he wrote me back:

>> Why would I sell my domain name for 3 months advertising revenue?

So this guy is making $40,000 A MONTH on one domain name. And you 'think' the domain is not in use. It's in use alright, as an advertising vehicle.. a cashcow.. a golden goose! If I had some of these names I'd park them too .. Screw work.
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shmuelix, 30 Jan 2007 @ 6:33pm

To: Techie112
"Why would I sell my domain name for 3 months advertising revenue?
"

I guess he was trying to squeeze some extra cash from you, my friend.
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MMid, 9 Mar 2007 @ 2:09am

Riddle me this...
It is rather eye opening to hear the opinions of someone who hasn't speculated in domain names, calculating a domains value using logic.

If anything, the one thing that doesn't factor into branding, human nature and trends is logic....

Search engine traffic and various other considerations to an extent does. This explains why catchy, short names do well, just the same as well established, clear industry names.

However you try and sell a yahoo or google type name + 5 letters. Nobody would care to remember it for starters and its bound to get typed in wrong.

I'm not going into pure numbers as to why your wrong on the financial side or what the return on educated investments are. Suffice to say people do buy reasonably priced domains, it is and likely will remain a smaller version of real estate for a long time to come

Rather than thinking all domains are worth a fortune, be reasonable with the price and a good domain will sell because it IS worth it in terms of branding/keywords/immediate advertising.
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