Buying and Selling Premium Domain Names
A website’s domain name is the website’s address on the Internet, the address that users have to type on their web browser’s address bar in the format www.the-domain-name.com in order for them to be able to access the website. In many ways, in fact, domain names are very much like the addresses used in real estate (where you can say your office or your business is on such and such a street) in order for people to visit it and do business with you. And as any person in real estate will tell you, the three most important factors that determine the success of a real estate project are ‘location, location and location’ as they always put it. Due to this fact, pieces of real estate located on prime locations are very highly sought after and always attract premium prices.
In a similar manner, one of the factors that affect the success of a website is its domain name, which as mentioned, is the address it is to be found at on the web. Get an easy to remember domain name (and one that can be easily associated with your business name or the main keyword you target) for your website, and you are well on your way to a successful website. Indeed there exists many websites whose success rests entirely on the domain names they are run under, and which receives thousands upon thousands of ‘accidental’ hits, when someone somewhere types in such a domain like www.food.com ‘just for the heck of it.’ Companies on the other hand will pay almost anything to get a domain name based on their name, if such a domain name happens to have been registered by someone else.
Now just as there exists a possibility for a foresighted person who is able to see places that are likely to turn into prime locations when a new town or city is being developed - and buying plots there only to resell them at a huge profit to others when the others come to realize the potential of such locations - there is a similar possibility (online) for a foresighted person to make note of domain names that are likely to be highly sought after at some point – called premium domains - register them and hold them, only to later sell them at an extremely huge profit to people who might desperately need them for some purpose.
There are actually some people and companies – often referred to as ‘cybersquatters’ who have perfected this trade in premium domains into an art, and who earn a decent living out of it. The idea is to be perpetually on the look out for domain names that might turn into ‘premium property’, register them and then market them on the aftermarket (a virtual market place where domain names are sold after already having been registered) and eventually selling them for a fortune.
Prices for premium domains are often quoted in thousands of dollars, and the business of buying and selling such premium domain names on the aftermarket is a potentially highly lucrative one, seeing that it costs less than $10 in most cases to register such a premium domain name, which you might eventually sell for up to amounts in the range of $100,000 to someone who really needs it.
Like in every market, there of course exists some brokers in the domain name aftermarket (apart from the ones who actually register the domain names). What these brokers do is buy the premium domain names from the people who might have registered it at a considerably good price – not because they (the brokers) need to use it, but rather to add value to it (maybe create some shell of a website around it), and then put them up for sale on the aftermarket at a much higher price and with a greater chance of making a successful sale. There also exists traders who perfected this art of buying premium domain names from the people who registered them and who no longer see any use in continuing holding them (or who are in desperate need of money), adding some value to them, and later selling them at a huge profit to someone who really needs them.
You could find yourself in the domain name aftermarket as a potential buyer if you are looking to put up a website under a certain domain name you fancy, only for you to discover that the name has already been registered by someone else, with the person who registered it having done so for speculative purposes and now asking of you a hefty price for it. In some cases, the considerable amount of money you spend in buying such a premium domain name does prove to be a worthwhile investment indeed.
As you go shopping for domain names on the domain name aftermarket, you need to do so aware of the risk of getting involved with fraudsters. If you must buy a name from a domain name aftermarket seller (or a ‘cybersquatter’ as such sellers are also known as), ensure that you only pay them after they have transferred the domain to you or at least use an escrow arrangement where money is held by an independent (third) party and only released to the domain name seller upon their transferring the domain name to you.
The business of buying and selling domain names on the aftermarket has come under intense heat in the recent past, after change of rules by the authorities which oversee the Internet and the allocation of domain names on the Internet. Under the new rules, it is possible for a business owner to claim the right to register a domain name that is based on their registered trade name, even when such a domain name happens to be registered by someone else (who probably registered it with an aim to later sell it for a profit at the domain name aftermarket). It is worth noting, however, that many people are wary of getting into disputes, and are therefore willing to buy domain names related to their business names from the aftermarket, as long as such domain names are being sold at what can be considered reasonable prices. The development of new TLDs (Top Level Domains) like .biz, .tv and .net also means that a person who can’t get a premium .com or .org domain name might opt for a ‘similar-sounding’ .biz, .net or .tv domain name.
In spite of all this, the business of buying and selling premium domain names on the aftermarket doesn’t seem to be one that is dying any time soon. While the new rule making possible for a business to claim a domain name that is based on their registered trade mark might beat the domain name business a bit, domain name traders on the aftermarket can still capitalize on premium domain names based on keywords, which are also lucrative, and to which no one can rightfully claim the exclusive right to register. And while the availability of new TLDs like .biz, .tv and .net might reduce demand in the short term, the traditional TLDs like .com and .org still carry a certain allure which makes many website owners opt for them even when they have the opportunity to register premium domain names under the newer TLDs at a much lower cost. In any case, the new TLDs like .biz, .tv and .net have already been invaded by aftermarket traders to a point where if you have not already done so, getting a premium domain name on them (the new TLDs) is getting increasingly difficult too. After all, the speculators and traders on the domain name aftermarket are always alert, on the lookout for new opportunities.
