Zak Muscovitch Gives BEST Argument EVER for the Legitimacy & Practice of Buying and Selling Domain Names

Morning Folks!!

After Verisign dissed ALL Domain Name Investors and Speculators by their blog post there was a strong response and sometimes emotional response by the domain bloggers and many others including yours truly. Domainers are angry and offended about that. Rightfully so!

Now the dust has settled and Zak Muscovitch (General Council for the Internet Commerce Association) has made a terrific response to and about Verisign on CircleID with an article published this week.

Zak's defense of buying and selling domains is as good as it gets! I will read it over and over as it is filled with PROOF that we we all do is BONA FIDE, LEGITIMATE and happening throughout history. Anyone that says anything else can STUFF IT! Nothing to feel guilty about! Nothing to even defend. We are doing something as old as capitalism is and 1000 years before that!

Rick Schwartz

Now from Zak Muscovitch:

"Domain Investors and Registrars Operate in a Competitive Marketplace

In its aforementioned blog post, Verisign made some unfortunate suggestions that domain name investors and registrars who participate in the domain name aftermarket may be considered "scalpers", and that domain investors' businesses are "questionable". The domain name aftermarket, to the contrary, is entirely lawful, highly competitive, and any profits earned are the result of successful investment in a free and open marketplace.

1. Investment Lawfully Exists in Every Marketplace

Whether in land, a catalogue of Beatles songs,[18] or domain names, investing in assets is a natural by-product of a free and open market. Domain registrants use and risk their own money to lawfully purchase generic and descriptive domain names on a first-come, first-served basis and from prior owners, and they have every right to continue to do so. Domain name investors range from an at-home mom making a casual investment in a handful of names, to a top branding agency that offers for sale thousands of domain names that were registered as a by-product of brainstorming new name candidates for clients,[19] to professional domain name investors who spend substantial money and efforts on building a portfolio and marketing it to the public. Domain names are also sold by companies large and small who originally registered the domain names for future development, defensively, or because having a valuable .com domain name is helpful for their business. Such business activities involving domain names are entirely legal, expected, and natural. There is nothing "questionable" about it. As one commentator recently put it, a domain name investor is engaging in no more "questionable" business activity than a Verisign shareholder who purchases stock in the hopes of reselling it for more than they bought it for and for whatever the market will bear.

Domain name investors risk their own capital to register or purchase a domain name with no guarantee that they will ever see a return on that investment. Domain investors compete with thousands of other market participants around the globe, seeking out desirable domains, and bidding against each other at auctions where the price is set by the market through the combined actions of thousands of participants. Many domain name investors lose money on their acquisitions, as they find that they have overpaid to acquire domain names that others do not regard as an attractive investment or which others do not want.

Investing in valuable generic and descriptive domain names is comparable to investing in vacant real estate. Both investments are made on the basis of an expectation that there will be an appreciation in value upon resale. A businessperson who wishes to open a storefront on 5th Avenue in New York City would expect that land to be already owned. Similarly, it should not come as any surprise that a valuable domain name already has a registered owner, whether it be a professional domain name investor or another kind of business, and that the owner is prepared to sell it at a market-determined price.

2. Professional Domain Investors Control an Estimated 10% of .com Domains

The best estimates are that the holdings of professional domain name investors represent approximately 10% of all registered .com domain names. The other estimated 90% of .com domain names are held by individuals, small businesses, and in the portfolios of large corporations. Those estimated 90% of domain name registrants may never interact with the domain investment community, and may never purchase an aftermarket domain name, but 100% of .com domain name registrants may soon be subject to higher registration and renewal fees from Verisign. As such, if Verisign were permitted to raise the fees for .com domain names, most of the burden would fall on the vast majority of .com registrants who are not domain name investors. It is not enough to excuse a fee increase by saying, "well, it's only a dollar or two more" that registrants are being charged, when that dollar or two more, across the entire class of .com registrants, adds up to billions of dollars in excessive fees.

3. Domain Name Investors Offer a Valuable Service by Providing Liquidity to an Illiquid Market

Domain names are notoriously illiquid investments. The holding period of domain names held by domain name investors can stretch into decades. Yet if an individual or a company wishes to immediately sell a domain name, it is the investor who steps up to provide a ready market and liquidity. If, for instance, a retiring couple who used a valuable generic domain name for their business and now wished to sell it since it was no longer needed has trouble finding an interested end-user buyer, domain name investors will often step in, bid against each other for the right to acquire the domain name, and thereby create a liquid market enabling the couple to quickly convert their domain name into cash. When Yahoo! wished to sell its contests.com domain name, it was put up for auction at a domain investor conference where the winning bidder paid $380,000.[20] Domain name investors allow domain name owners to readily obtain cash for domain names that they no longer need, or may otherwise wish to sell.

4. Domain Name Pricing and Availability Would be Little Different Even in the Imagined Absence of Domain Name Investors

Domain name investors do not set the market value of aftermarket domain names nor do they determine which domain names are desirable — the operation of a competitive marketplace does. Prices and desirability are dictated by the market. If the asking price is set too high, a buyer can choose from a variety of similar domain names available at a range of prices.[21] If a domain name is desirable, it would have been registered long ago even in the absence of domain name investment.

Verisign proposes an unrealistic scenario in which, in the imagined absence of domain name investment, valuable domain names such as Ice.com (bought for $3,500,000) or Super.com (bought for $1,200,000)[22] could be obtained at a standard registration cost of around $10 each. Even if professional domain name investors vanished, high-quality domain names would not be sitting unregistered and the owners of these domain names would seek the market value for them.

For instance, Procter & Gamble was one of the companies in the early days of the Internet with the foresight to register valuable generic dot-com domains, such as the kind favored by domain investors. When they went to sell some of their domain names, such as flu.com, beautiful.com and thirst.com, P&G;was surprised by the high value of those domains in the secondary market. P&G;did not offer those domains for sale at its cost, nor did anyone expect them to.[23] Similarly now that electrical engineer Marcelo Siero has decided to sell the domain name ee.com, which he registered 24 years ago, he is seeking a market price in the millions of dollars,[24] and who would fault him for that?

Twenty years into the evolution of the commercial Internet, and after over 100 million .com domain name registrations, there are almost no domain names of general value sitting unregistered. The net impact on .com domain name availability due to the presence of domain name investors is that domain name investors have registered millions of lower-quality, less desirable domain names that otherwise might have gone unregistered.[25]

5. Verisign Encourages Domain Investing and Has Benefited Greatly From It

Verisign, throughout its history, has encouraged people to invest in domain names and has been a primary sponsor at conferences focused on domain name investing. Verisign had good reason to do so, as domain name investors send tens of millions of dollars to Verisign annually from registering millions of domains that no one else has shown much interest in. The business most benefiting from these registrations is Verisign itself, which receives $7.85 per domain name per year while taking no risk, whereas the domain name investor often loses money on his or her investment.[26]

6. Verisign Sells Domains at Premium Prices

During the "land rush" for the Japanese[27] and Korean[28] versions of its .com domain names, Verisign unilaterally set initial prices on certain keyword domains at over $10,000 each.[29] For instance, Verisign set a premium price on the Japanese version of <blog.com>, which is ブログ.コム. This domain is currently available for first-time registration at a price of $15,000 from Name.com.[30] Our understanding is that while a portion of this price represents a retail mark-up charged by Name.com, the base price set by Verisign was over $10,000. Verisign's criticism of speculators for offering premium domain names at market prices, when Verisign engages in comparable sales, therefore appears to be extremely contradictory."

[18] "McCartney told Jackson about how he had been purchasing other artists' catalogues (such as Buddy Holly's) as a business investment.", see: http://mentalfloss.com/article/85007/how-michael-jackson-bought-publishing-rights-beatles-catalogue

[19] See http://justtheword.com/

[20] https://domainnamewire.com/2009/06/17/yahoo-sells-contestscom-for-380000/

[21] "Finding the right URL can be daunting, but with a little time and effort you can absolutely find a domain that works for your brand — and your wallet!", see https://catchwordbranding.com/catchthis/naming-tips/your-websites-url-an-expensive-com-domain-name-or-these-creative-alternatives/

[22] Source DNJournal.com

[23] See https://www.nytimes.com/2000/06/28/technology/procter-gamble-plans-to-sell-domain-names.html

[24] https://globenewswire.com/news-release/2018/03/07/1417995/0/en/EE-com-Domain-Name-Announced-for-Sale-by-VIPBrokerage-com-DomainAssets-com.html

[25] "While buying up a ton of domains seems like a great way to make some extra money, the real world results show that it is very hard to make that process profitable."; see: https://moz.com/blog/is-buying-domain-names-profitable

[26] https://morganlinton.com/hand-registering-domains-today-is-a-fools-game/

[27] https://blog.verisign.com/domain-names/launch-of-verisigns-first-idn-new-gtld-コム/

[28] https://blog.verisign.com/domain-names/verisign-launches-new-gtlds-for-the-korean-market-닷컴-and-닷넷/

[29] https://domainnamewire.com/2016/06/15/domainers-say-verisign-bungled-first-idn-launch/#comment-2239419

[30] https://www.name.com/domain/search/xn--qckyd1c.xn--tckwe


By Zak Muscovitch, General Counsel, Internet Commerce Association

Domain vs Kiosks. The Hole in the Donut Theory. A River of New Found Cash!!!!

Morning Folks!!

We have all seen those small Kiosks scattered throughout malls in previous un-rentable, un-profitable  and just public spaces. (This is what I would refer to as "Selling the HOLE in the donut". You would be hard pressed to find one under $1000 a month and in most cases a decent mall can be thousands more. Your radius for sales is not worldwide it's a FEW FEET! Malls took worthless space (the hole) and made it profitable. (the donut)

If you are in business and you don't understand "The hole in the donut theory" you are leaving BIG MONEY on the table.

How much you think Simon Malls takes in just on Kiosks? They took something that was FREE and made it income producing. Hole in the donut!

ANY domain has more  value than that IF there is a demand for that domain. Just because the market has not figured that out YET does not have to make ME or YOU change how we view it and price accordingly.

Our biggest hurdle has always been domainers selling their assets for chump change because of financial weakness and lack of sales and negotiating skills.

In 1995, I decided that ANY domain that was wanted by a 3rd party had a MINIMUM value of $15,000 to a business. That's before domains had virtually NO re-sale value. But I see the world thru the eyes of a different lens. In this case, thru the lens of a kiosk or a lawsuit. Then it went to $50k minimum in 1999, $100k minimum inn 2001 and now I have a $250k minimum unless I get a piece of the action. Each level criticized by fools.

So, the way I view things in 1995, EVERY domain that had value, had a value of at least $15,000. I only sold 1 domain for under that. But that was for a loss and a tax deduction during a year that I needed a tax reduction.

If other folks saw what I saw they would have ever sold their NNN.com domains for $5000. Or ANY of their other names for that level.

How much does a stinking outdoor business sign cost??? Could be TENS of thousands of $$$ and can go MUCH MUCH higher! For a damn sign!

What other real world comparisons are domainers not making?

I have talked about this for DECADES! The value of a domain has NOTHING to do with what you paid for the domain. NOTHING! Unless you SUCK or are just plain FOOLISH as a domain investor. Know-nothings look at their cost! But these geniuses don't have a clue about VALUE!

To a successful online entity, the DOMAIN is or will be the single biggest bargain of their entire lifetimes! And they will ALL wish they bought many more!

Rick Schwartz

 

Social Media is No Longer Social, It’s Dangerous!

Morning Folks!!

Social Media is no longer social. It's almost anti-social at this stage and won't be getting better. It will continue to get worse as hate and agendas now control it. It's not even safe!

Social Media has been weaponized. It has destroyed people and careers by the thousands! Your personal data has been distributed to every crook in the universe.

There is simply nothing "Social" about Social Media. It's a war zone.

The only Social Media I still deal with is Linked-in and to be honest, I never made a penny or got a connection via their platform. They may be next. It's a time waster not a money maker. Mostly spammers. I left Twitter and Facebook last year for multiple reasons, but sparked by the Berkens incident.

The Internet in general stokes hate as many of us have seen first hand starting early on in the 1990's. It's just gotten worse and BILLIONS of people are participating all with their own hate, anger and prejudices. As it organizes, it becomes very  dangerous. More dangerous than any other media in history.

Social Media may be the front lines of a war that is sure to come. A World War.

Rick Schwartz

The Biggest Threat to Domain Investors are Domainers!

Morning Folks!!

I have been involved in some 55 industries in my life. The core of most industries are the same. How they run is very similar and the back biting is pretty much universal.

But most of those industries had associations that were widely supported. That offered group discounts and were powerful by their sheer numbers. They had standards of conduct. Most associations charge up to $99 for annual dues that are easily offset by the benefits. Some are higher some are lower.

But with all the grandstanding and all the talk about all the bad companies out there that hate domainers etc. None have done more damage than domainers themselves.

Obviously the big one is trademark infringement. Let's make it easy. If you have a company name inside your domain without a specific "Free Speech" twist or agenda, then your domain has a high likelihood of infringement. But I am not a lawyer. I just know the difference and so should every domain investor.

Maybe before we have a "Bill of Rights" (Which there is no reason not to support) we need to set STANDARDS of what WE stand for. Standards of OUR OWN responsibilities and even self-policing. Who we are as professionals and clearly separating ourselves from the MASSES OF ABUSERS that DEFINE domainers!

I will never apologize for investing in domains. They set the rules and many of us simply played by the rules and have found all levels of success.

That said, NOBODY on the planet gives a rats ass about domainers except us! We are TOE JAM at best! We are looked at as some of the lowest forms of life by those heavily involved with the Internet. Cockroaches! And some of it with good cause! Most domainers are an embarrassment! Infringers to the nth degree!

And that is just the tip of the iceberg. Shill bidding. Scandals swept under the rug. Widespread abuse of all types of things. Clawbacks. Auction houses with disgusting business practices. Add your own in comments!

The "Domain Industry" is a Dirty Rotten industry such as it is. And again, let me state clearly, there is no industry. There is no association that represents rank and file domainers. There are no standards of conduct.

I appreciate the work the ICA does but my point of contention from the get go has been "Inclusion". There is power in numbers. One $5000 member does not have the power as 100 $50 members. One $25,000 member does not have the power that 500 members have. There should be TENS of thousands of members and THEY (the ICA) should be putting on the "Industry Show" for the overall good like other industries do. Serving and representing an entire industry vs 20 SELF SERVING wildcatters with an agenda!

In the way I saw things and how it SHOULD have unfolded......it would have been my desire and long term vision to turn TRAFFIC over to the ICA to run. That was what I had hoped for. It was just not possible with the makeup of the ICA as I saw it and decided to just pull the plug instead and preserve whatever history we had.

And to be honest, the window of opportunity on this has all but closed. There is no domain industry and there never will be! Domainers are very charitable but charity starts at home. When the money was flying around we helped many causes but we never cemented or protected our own cause in an effective, meaningful and long lasting way. That window of opportunity is gone.

Just sayin'

Rick Schwartz

Negotiating Contracts Can be Expensive. Have the Buying Party PAY for YOUR Attorney!!

Morning Folks!!

When I negotiate a multi faceted domain deal I don't even START the final negotiations until they agree to pay my legal expenses. Negotiating any bona fide contact may easily cost several thousand dollars. My deals cost up to $2ok because there are a lot of moving parts.

Why should I be out of pocket thousands of dollars if the deal falls thru? It's bad enough to waste the time let alone the money. Now this happens after the basic deal is made. But the deal MUST be translated into an ENFORCEABLE contract. That can get expensive as the 2 sides weave the wording.

And the keyword is "Enforceable" which means if you have a sloppy contract, you have nothing.

I started doing this many years ago and I do this with ALL contracts of a d0main purchase. Not sure how many others if any do this. But this is my standard operating procedure.

I am not talking about cash deals. That's why we have Escrow.com. But any contract, you gotta send my lawyer $2,000 if you want me to take you seriously. Why should I be out of pocket if the buying party is not serious or does not follow thru? Am I willing to lose a deal over this? Of course! Have I? NEVER!

Rick Schwartz

Is 2018 Shaping up to be a Good Year for Top Reported Domain Sales? Short Answer “Not Exactly”.

Morning Folks!!

So, since 2005, Ron Jackson's DNJournal has been chronicling the top reported domain sales each and every week as well as a "Top 100 Chart" for each and every year. A LOT of work! Thanks Ron!

I took the liberty of adding up all those reported sales starting in 2005 and segregated by year. It doesn't tell all but it does tell a story. Especially of you study each and every sale during those 14 years. Some incredible deals!

Now please don't remind me that most domain sales are not reported. They are not. And of course Yung Ye's $162 Million won't appear nor Mike Berkens $35 Million. Nor will many many many others that we will never hear about that have quietly walked into the sunset.

That all said, it is what we have and it still tells a lot about things.

2005---$16,383,221

2006---$29,870,018

2007---$44,250,718

2008---$44,347,756

2009---$34,622,312

2010---$44,393,336

2011---$23,081,833

2012---$18,248,594

2013---$28,243,313

2014---$43,096,937

2015---42,890,000

2016---$27,558,000

2017---$27,400,000

2018---$23,070,000

Total $447,516,030

And these are just the top 100 each year.

The average year...$31,965,430

2018 not shaping up to be a big year. However there is still time and a blockbuster deal could turn things around on a dime! However, as of now, 2018 ranks among the 3 lowest years as you will see below. And may I remind you that was with intense selling pressure out there. Everyone and their grandmother is trying to sell their domains these days. That was not the case in many of those prior years where it was not a selling frenzy but was a buying frenzy.

So if you look at it through that lens, and I do, that illustrates weakness. Not terrible. But weaker. Will that change for 2019 and 2020? It should! With the issues social media is having, domains will end up as the beneficiary as folks want to control their own destiny not having the likes of Twitter and Facebook control their own narrative.

2018 was a good year for business. Companies have good cash flow and many sitting on large chunks of cash. As they see Sears closing up and many others following, can't we finally make a really good case for 1 domain worldwide that rivals and perhaps exceeds 3000 stores ready to collapse with overhead more than $8 a year after the initial buy which is still a FRACTION of what it cost to build ONE Sears Store? I REFUSE to abandon that foundational mindset that I have! That is why I refuse to give away domains for pennies on the dollar. My vision is stronger than theirs. And it's based on simple common sense and math.

Whether we compare domains to real estate and associated costs or the cost of a Super Bowl Ad or the cost of a 30 second spot on TV, the domain name remains a bargain that business has overlooked but NOW are FORCED to revisit!

The forecast for 2019 and 2020 are looking pretty damn good the way I see the universe! But it can only look good if you have positioned yourselves well and own domains that 3rd parties need, want and desire. Our job is to show value when compared to alternatives and look at the future while doing so.

Rick Schwartz

Verisign throws Domain Speculators Under the Bus. F*ck You Verisign. Apologize!

Morning Folks!!

I have been very supportive of Verisign's new price increases. I still am. But yesterday Verisign threw the domain industry and domain speculators and leaders directly under the bus and came close to calling us CRIMINALS! That was rude, it was uncalled for and as far as I’m concerned Verisign is now an enemy of the domain industry. 

That said, STUPID DOMAINERS!!! STUPID DOMAIN INDUSTRY!! This was a DUMB fight against Verisign. A fight that was nasty over pennies! The STUPID DOMAINERS were AWOL when the real fight was lost 14 YEARS ago!

Domainers called out Verisign for no legit reason!

One idiot calls them a "monopoly/mafia". Nonsense!!! They are no more a monopoly than the the Division of Motor Vehicles or your local electric company. They are meaningless in our lives. Verisign is the same. They are regulated. If not, you would be paying BIG $$$ for your assets!

When the prices go back to $100 each, give me a call. Won't be in OUR lifetime!

And Verisign, We are NOT "hiding in plain sight". That is a disgusting statement insinuating we are doing something illegal. Go FU*K YOURSELVES!

They called people who buy domains to sell for higher prices “domain scalpers”! Go F*ck Yourselves!

But domainers brought this upon themselves with the language they have use in the ridiculous out rage they have shown for really very small increases over many years while they themselves make fortunes.

Petitions??!! NONSENSE! I never saw the Domain Industry come together for anything that counted but they came together to fight a pointless losing battle. Verisign is stupid! But domainers are 10x dumber!

Hey, MORONS at Verisign, why don't you put out the number of total domains owned by speculators!? The ones YOU profit from! How many!!??

That all said (more to come) Verisign may have just ignited the domain industry like no other company could do. It gave domain speculating high visibility by a high visibility company. That’s a good thing!

 Regardless of all that it was very mean, it was mean spirited, it was uncalled for and most of all it’s simply not true. They invented the game. Domain speculators have supported Verisign to the tune of billions of dollars a year. So there’s only one thing to say to Verisign. F*ck you Verisign.

And letting me clearly say that Verisign is a meaningless company to us. They are nothing more than your motor vehicle registrar. Who gives a crap about them? They provide a service. You give him a few dollars a year and they give you a drivers license. They have a monopoly. Who gives a crap? Too many idealistic domainers taking shots at Verisign for quite a while now just got a little payback and some smack down. 

But let me reiterate again that Verisign actually gave legitimacy to domain speculators by trying to delegitimize us. A very stupid thing to do. Verisign is a bitter company. But they are meaningless to me. They mean nothing. I never talk about them. I never discuss them. They mean nothing. They are nothing more than a utility.

The good news is they are pointing to the multi billion dollar domain speculation industry. That’s us folks! A multibillion dollar industry that until yesterday was completely under the radar.

The single most important thing  to focus on is this:

"So how large is this market? The answer may shock you. Verisign estimates that over $1 billion in annual secondary-market sales of .com domain names can be documented through publicly available data. Several domain speculators believe the size of the total market is $2-3 billion a year. Perhaps $1.5 billion is closer to the actual number, which is about equal to the total annual pre-tax domain name revenue of all ICANN registry services providers combined, including Verisign.aid and SMART DOMAIN SPECULATORS"

Run with it!! Post it everywhere. Tell everyone! This is a LIFE line! But dumb domainers will focus on pennies at the expense of BILLIONS!!

Verisign is very stupid min their comments. They have made a fortune from domainers speculating and warehousing domain names. Now they complain and call out companies and individuals???

VERISIGN OWES ALL OF US AN APOLOGY!

VERISIGN  OWES ALL OF US AN APOLOGY!

VERISIGN OWES ALL OF US AN APOLOGY!

I was particularly surprised that Verisign actually mentioned names of companies and individuals in their blog post. Either way they own that blog post. They own the negative parts and we own the positive parts. WAKE UP!

So, Verisign I am very happy for your price increase but other than that please go f*ck yourselves! Go f*ck yourselves!

Quasi-legitimate industry or business? "hiding in plain sight"? Go f*ck yourself three more times assholes. The industry we have been in has been in existence for thousands of years in different forms. Calling us names and demeaning an entire group and industry is over the line! Calling us CRIMINALS??? Isn't that the point they are trying to get to with "hiding in plain sight"?

F*CK YOU VERISIGN!

There is a good chance they could use someone like Phil Corwin to lobby to change rules and laws for how many domains an entity can have. They will fail miserably in that effort. THAT is the fight my friends! But the Domainers that fought the increase are responsible for their new position! I am sure many will call me out! But sorry, this is on YOU and your idiotic petition!

I always look for a silver lining and here are some of the things we can use in the street and there’s individuals to further our efforts and legitimize what we do and have people like Verisign that try to delegitimize this pay the price.

I am sorry, VerisignSucks.com is already registered and forwards to a story about them..

Maybe I will introduce motherf*ckers.com to Verisign?

Freedom of speech works both ways!

That was mine, this was theirs!

"But there is also an unregulated secondary market – led by domain speculators – hiding in plain sight. There, some speculators buy domain names at regulated low prices, then sell them at a far higher price. This secondary market is as old as the domain name system itself. However, since the wholesale price cap was imposed on .com in 2012, the secondary market has expanded in ways that exploit consumers.

Look at the website HugeDomains.com – owned by registrar TurnCommerce – where nearly four million .com domain names are warehoused and offered for sale:


  • None are offered below $195, and 90 percent of their names are priced above $1,000.

  • The average price is roughly $2,500 per domain – a markup of more than thirty thousand percent (30,000%) over the regulated wholesale price of $7.85.

    • That’s a profit margin of over 99 percent on each sale

    • At these prices, the value of the HugeDomains’ inventory is nearly $10 billion



  • Many of HugeDomains’ names have incredibly high price tags. Here are a few examples from their website, as of November 1, 2018:

    • NeighborhoodWatch.com for $1.25 million

    • Margin.com is $3.5 million

    • Glossary.com is offered at $7.5 million

    • Even the fluff in their inventory isn’t cheap – Fluff.com is listed at $325,000




And yet, TurnCommerce has been actively lobbying our government to freeze the wholesale price of .com domain names. When they can buy .com names at capped wholesale prices, and mark them up to $2,500, $50,000, $1 million, or even $7 million, does anyone believe they are lobbying for continued price caps in order to protect consumers?

Even traditional registrars like GoDaddy have become big players in the secondary market and hold large portfolios of domain names for resale. GoDaddy’s public filings show it has spent over $100 million buying domain names for resale purposes. GoDaddy holds these domain names and then offers them to consumers and small businesses at prices that are often thousands of times the wholesale price. There’s nothing in GoDaddy’s public filings about its profits from this practice, but GoDaddy claims its domain name portfolio is worth $2.5 billion.

TurnCommerce and GoDaddy are not the only ones profiting from .com price caps. Domain speculation, or “domain scalping,” as some call it, has become a highly profitable industry unto itself. In fact, one of the top domain name speculators in this market reports a net worth of $500 million. These speculators even have their own lobbying group, the Internet Commerce Association (ICA), where TurnCommerce and GoDaddy are members via their subsidiaries NameBright and Afternic.

Ironically, in this speculators’ market, the price control on .com domain names serves only to reduce the cost of domain names bought by these speculators. Domain speculator Frank Schilling stated that the .com price cap “…has given the [domain speculation] industry a shot in the arm,” in a Jan. 2017 podcast interview. Flipping domain names or warehousing them to create scarcity adds nothing to the industry and merely allows those engaged in this questionable practice to enrich themselves at the expense of consumers and businesses.

So how large is this market? The answer may shock you. Verisign estimates that over $1 billion in annual secondary-market sales of .com domain names can be documented through publicly available data. Several domain speculators believe the size of the total market is $2-3 billion a year. Perhaps $1.5 billion is closer to the actual number, which is about equal to the total annual pre-tax domain name revenue of all ICANN registry services providers combined, including Verisign.

Recently, some who profit most from the unregulated secondary domain market have been lobbying our government to freeze .com wholesale prices. They say their goal is to protect small businesses and consumers. But their business models and domain resale prices show that their real goal is to preserve the profits they earn from .com price caps.  In fact, the real opportunity for consumer savings would come from reducing or eliminating the more than $1 billion per year in scalping fees that businesses and consumers pay today."

With Godaddy and other large companies we have some major allies to fight the REAL FIGHT I always knew would come.

"hiding in plain sight"? Verisign, you owe us an apology! I understand this looks like payback for the HORRIBLY MISGUIDED petition domainers had that I opposed. You guys won! Domainers tried to stop your win and you guys are spiking the ball. But it was wrong minded just as the petition was wrong minded!

Either way, VERISIGN OWES ALL OF US AN APOLOGY! But I will use THEIR words from now on against them and to help us!

And to the Domain Industry, this is what I wrote just 30 days ago!

"Go buy some Verisign stock! I hope the prices go up and it forces the wannabes out. Remember, I was paying $100 a pop at the start. Then $70. Then less. At $8 I am not sure why everyone is so upset. For a REAL business $8/year is a joke! You can't get a decent Burger, Fries and Coke for $8 let alone a WORLDWIDE presence!

So stop the whining! Increasing the registration prices only hurt domainers and NOBODY gives a rats ass about Domainers! I don't think a real business owning 1-10 domains cares. Why should they!?

I would suggest that some dump all their domains. With the savings on renewals just buy Verisign and you will MAKE MORE MONEY!"

Sorry, but I blame the petition for this. That won't make me a favorite of whoever created it and signed it. But if not for that nonsense that was 14 YEARS late, that blog post yesterday would have never appeared. IMHO!

And don't like my view? TOUGH!

btw Verisign, how many domain speculator shows and events have you gone to, supported or sponsored? How many of your blog posts have you emailed me about? How many land rushes did you advertise to me via email? Hypocrites!!! APOLOGIZE PUBLICLY before that all comes out and makes you look BAD!!!!!!!!

EXHIBIT A! "Hi Rick – Today, Verisign announced the opening of the Landrush Program period for the first internationalized version of the .com top-level domain (TLD) in Japanese script, .コム , is open for anyone to register on a first come, first served basis until June 12, 2016. For more information on the Japanese IDN rollout, please check out the Verisign blog post."

 

EXHIBIT B! Hi Rick – Hope you’re well! Today, Verisign released its latest Domain Name Industry Brief, which provides a review of the state of the domain name industry through statistical and analytical research. The following are the top-line numbers at the close of Q1 2016:


  • The total number of registered domain names rose to 326.4 million worldwide across all top-level domains

  • 12 million domain names were added to the Internet in Q1 2016:

    • This increase globally equates to a growth rate of 3.8% over Q4 2015

    • Worldwide registrations have grown by 32.4 million, or 11 percent, year over year.



  • The .com and .net TLDs reached a combined total of approximately 142.5 million domain names in the domain name base in Q1’16

    • The base of registered names in .com equaled 126.6 million names, while .net equaled 15.9 million names

    • Verisign processed 10 million new domain name registrations for .com and .net, as compared to 8.7 million domain names for the same period in 2015.



  • Verisign’s average Domain Name System query load was 124  billion across all TLDs operated by Verisign, with a peak of 189 billion


For more information, copies of the Q1 2016 DNIB, or to view past reports, visit VerisignInc.com/DNIB, where you can also find the Q1 2016 infographic. Please let me know if you have any questions.


 

EXHIBIT C! Hi Rick – Hope you’re well! In case you missed it, I wanted to flag the latest post in Verisign’s blog series on the top 10 keywords in registered in .COM and .NET each month. For quick reference, here are the trending registrations from June:


 

When they can make money from us they love it! They encourage us to register domains as speculators Then they compare us to CRIMINALS? GO F*CK YOURSELVES VERISIGN!!

If you want to start a petition (and I don't), maybe protecting your actual LIVELIHOOD from VERISIGN and their LOBBYISTS is more important than PENNIES for a damn registration!!!!~!~

For smart people all around on both sides, you all do some of the dumbest things I have ever seen. Verisign should be banned from ALL domain events until they clear the air. Persona Non Grata!

Verisign has been "In Bed" financially with domainers for many years and now we are "hiding in plain sight" and "Scalpers???!! MotherFu*kers!

If you can sign that worthless petition that brought all this, then you can post your outrage here or possibly admit the petition was a DISASTER! Thanks!!!!

By the time Monday morning comes and these ingrates and hypocrites show back up to work at Verisign, their ears should be on fire for being exposed! Are they not encouraging us to buy, then trafficking and profiting in the same thing they are accusing us of doing and "hiding in plain sight"?!

Rick Schwartz

 

Planting Seeds Each and Every Day is How to be Successful Each and Every Day!

Morning Folks!!

I determine my success by how many seeds I plant each and every day. I don't look much at what I harvest. If I plant right, the harvest will come. The harvest will take care of itself. I can plant seeds for myself and I plant seeds for others as well. I just never tell them.

Some seeds are small and some seeds are gonna hopefully be giants. And just because I plant seeds does not guarantee they will germinate. In fact, most won't. That's why planting seeds every day is so important. You may plant for weeks or months or years waiting for even one to germinate.  It's a numbers game. Keep on keeping on. Just do it each and every day like a religion.

In time planting seeds becomes a natural part of life. Like drinking water. It's almost a passive act.

But unfortunately we have an industry made up of folks that think they can plant a seed and germinate in one day. They are right!! They can buy an $8 domain, sell it for $10 and pat themselves on the back!

I live by one saying: "An overnight success takes 20 years." 20 years of work and sometimes sweat and worry. But if you plant good seeds every day you will worry less. You know you have a plantation full of seedlings. They will germinate when they are ready or not at all. It's a numbers game.

In 2012 I wrote this about this very blog and planting seeds:

"When you sit and plant seeds every day, some germinate. You don't even have to be Johnny Appleseed, but I like his measure. So since 1996 I have written with clarity and certainty driven by belief and passion. It's an 'All in' type of game for me.

I have always believed these words would pay dividends. Not even sure which way or form those dividends would come or shape they would be, but dividends none the less."

So writing about business, life, domains and all the rest is just one way I plant seeds for others. I never know what word, sentence or thought could be life changing for somebody I have never even met and probably never will. That's one very visible way I give back. That's the way I give.

Rick Schwartz

There is NO Such Thing as a ONE WORD GTLD!!!

Morning Folks!!

Common sense is the key to success no matter what you do. If you don't have common sense, you are not able to see the SIMPLE and EASY things. You can't make the easy decisions. Everything has to be complicated because you are so smart!

There is no such thing as a 1 word GTLD. There is a MINIMUM of TWO words and a consumer needs to memorize them and get them both right! On the other hand .Com is already baked into the cake and the memory banks of every human being on the planet. So there is no need to even mention the .com. It's the default.

Many commercials don't use the .com. They don't have to. It's the default. Anyone with an ounce of common sense can see that.

A genius will start with a square wheel. The guy with common sense will come along and simply sand down the edges and make it work.

So a 2 word left of the dot GTLD is really a 3 word GTLD. Way too many moving parts to remember. I know, you are a genius and you remember everything. But if you had any common sense, you would know that the masses easily confuse things. And your argument is always to minimize each and every pitfall that a GTLD has. To turn a blind eye not to one pitfall but 100's. 100's of small leaks on a ship will surely sink that ship if ignored. And that is what we are seeing. A sinking GTLD ship. BYE BYE!

Rick Schwartz

Domainers that Invested in GTLD’s are not being Quiet. Many of them are GONE!

Morning Folks!!

When you see the domain show for 23 years you see things repeat themselves several times. I am such a moron for not investing in IDN's. Just ask any IDN guy that never found the end of the rainbow.

I am a moron for not investing in .net even though the techies told me to. Now we can see not only is there low demand for .net there is also very low value as well.

I am a moron for not investing in ccTLD's. Now there was a place for those but I did  not want to waste my time chasing those when there were still .coms to chase. And they have less value and less demand than their .com counterparts. So, just not the best way to invest my TIME. But I understood those that did.

I did prove to be a moron myself when I bought into .Mobi. I had a lot of company at the time. lol Remember, when I bought Flowers.mobi I was bidding against several bidders that went to $150k and one that went to $195k. But when I think back, that may have been a cheap lesson. Look how much I saved not buying into the GTLD .CRAP!! That was when there was just ONE new extension and they failed miserably. Now we have 500-1000 that are doing the exact same thing.

.Win is a big loser for domainers. Back in November 2016, 2 YEARS ago, .win peaked with 1.3 Million registrations. Today, only 549,000 left and dwindling. Godaddy has a whopping 1029 registrations.

Those are domainer dollars being flushed down the toilet. How do I know it is domainers? Well, only a fool would even ask.

Domainers that invested in GTLD's are not being quiet. Many of them are GONE! Even the registries are "Dying on the vine". A term I have used for YEARS to predict the fate of this GARBAGE!

GTLD's have detoured and delayed the demand and diminished values of legacy extension domains. It's nothing more than a cancer on what WAS a HOT and THRIVING Domain Industry. Now look at it!!!!! The only ones you can blame are domainers. They burnt down their own industry.

These folks crapped on their own golden goose and we are all paying the price in TIME and VALUE.

At least I can say that openly now and I don't care if you disagree. It is what I believe!

"When you put a single piece of SHIT in the STEW it is no longer STEW, it is SHIT!" We have hundreds floating around now.

Rick Schwartz