Sunday, November 30, 2008

Book Review: The Domain Name Game

Over the weekend I had a chance to read the "Domain Name Game" by David Kesmodel.

The book is a fun, highly-motivating read and I recommend it if you want an insight into who is who in the domain industry.

Furthermore, it's helpful to understand current trends by looking at the recent past. Some themes I found most interesting:

Cyclical Nature of the Domain Industry
There have been booms and busts before in the domain Industry -- and there will be more in the future. The best domain buys obviously happen when you can buy low-and-sell-high. Right now, we can grumble about the decline of pay-per-click advertising and the depressed auction market. Or, we can go out and buy great names.

New advertising paradigms will be created during tough times and they'll lead us into even bigger growth in the future. The best domain real estate (generic .COM names) will become increasingly valuable and monetizable.

Bigger is Better
Consolidation is the nature of the domain-name beast. In the old days, the system made it tougher to collect vast portfolios of names. For example, at first you had to fax requests for domain names. Later the yearly registration prices zoomed up to $100/year (the were free in the very beginning). There were no tools for auctions or drop-catching. Domainers were individuals and small companies. Much of corporate America didn't "get it". Many tiny advertising networks tried to get into the game.

Today, names are cheap and easy to register. There are plenty of auction sites and drop-catching sites. Domain name portfolios consisting of hundreds-of-thousands of domain names are not uncommon. These are owned and managed by corporations, registrars and the like. Advertising is dominated by one player: Google.

But even adding all these big portfolios up, they only form a small percentage of the total market. There is still plenty of room for domain wildcatters to find valuable domain names, but you need to be aware of the big fish and the advantages that they have.

Summary
I highly recommend this book. It's even a great resource for explaining to friends-and-family what the domain business is about.

I walked away with some good ideas for improvements to HotNameList.com, based on some things that were done in the past that I didn't know about. Hopefully, you'll see those appearing in the site over the next few weeks.

Happy Name Hunting!

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