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December 2006 Archive

Here's the The Lowdown from DNJournal.com! Updated daily to fill you in on the latest buzz going around the domain name industry!

Compiled by Ron Jackson (Editor/Publisher)


HAPPY NEW YEAR! Our office will be closed for the holiday weekend Saturday, Dec. 30 through New Year's Day (Monday, Jan. 1). We'll be back Tuesday, January 2 with new daily updates!

The boom in the domain business and the entire range of new Internet ventures often referred to as Web 2.0 has some questioning whether or not we might be in a new bubble, similar to the one that burst after the first Internet wave a few years ago. The Wall Street Journal Online tackled the subject this week with an article featuring a debate between venture capitalists Todd Dagres and David Hornik who are on opposite sides of the issue. You can read the article and come to your own conclusions, but we tend to agree with Mr. Hornik who said, "I was recently asked by an entrepreneur what I thought would be the next great technology in the coming year. I told him I thought it would be the Internet. We have just started scratching the surface of the enabling power of the Internet. Whether it is called "Web 2.0" or "New Media" or "Enterprise 2.0," Internet services are going to drive the world's economies for the foreseeable future. To me that doesn't spell bubble, that spells opportunity.
Posted Dec. 29, 2006

The Mercanti Group, an investment bank based in Minneapolis, has issued a new report that is very enthusiastic about the prospects for the domain business. The opening paragraph of the report states "Just as open land led settlers expanding westward in great numbers, virtual land on the Internet continues to proliferate and increase in value as consumers and businesses embrace the medium and transfer more of their daily activities online...Forward-thinking investors and companies that analyze this shift in behavior and emerging landscape and develop competencies as brokers, owners and marketers of virtual land will be handsomely rewarded."
Posted Dec. 28, 2006

Yahoo! is counting on its upcoming Panama ad monetization service to help reverse the company's flagging fortunes in 2007, but an article released at BusinessWeek.com yesterday questions whether Panama will be enough to turn the search giant around. Writer Catherine Holahan said "While the company has concentrated on search advertising, rivals have gained ground by focusing on other methods of delivering targeted ads and brand experiences to online consumers. The competition also has been working hard to sell advertising on the social-networking and user-generated content pages that have exploded on the Web in the past two years, seemingly eclipsing the amount of more specialized editorial content around which Yahoo sells much of its most expensive advertising." Holahan added " If Yahoo doesn't figure out how to make significant money off its social media and user-generated content pages, it risks widening the ad revenue gap with Google, which has begun expanding beyond search ads into Yahoo's specialty—online branded advertising (the term given to ads intended to promote brands and cultivate an image of a product rather than simply make a sale). Yahoo already has quite a way to go to match Google in overall ad revenue. Google took in roughly $7.32 billion in ad revenues during the first nine months of 2006. Yahoo made just $4.14 billion during the same period."
Posted Dec. 27, 2006

Statistics on the Christmas shopping season are already coming in and while retail stores made a lackluster showing overall - business online set new records. This article from the Associated Press today said "Online spending from Nov. 1 through Wednesday reached $21.68 billion, a 26% increase compared with 2005, according to ComScore Networks, an Internet research company. That was better than the 24% rise that ComScore had expected. Amazon.com reported yesterday that the season finished as its "best ever," with the busiest day being Dec. 11.  Yahoo! Shopping reported yesterday that its holiday season beat internal forecasts. It said that the number of shoppers to the site rose 24% in December compared to the year-earlier period. Traffic to merchants rose 30% in the past month, compared to the year-earlier period."
Posted Dec. 26, 2006

Organizers of a new domain conference to be held in London, England February 2, 2007 say the event, dubbed Domain Channel,  is the first globally marketed conference dedicated entirely to the UK domain market. The one-day show will be staged at the Park Plaza Hotel in Central London, just a short walk away from Victoria Station. David Brayshaw is organizing the conference with major sponsorship support from NameDrive.com. Brayshaw said Google, Yahoo!, Nominet, Miva and Trade Doubler are also among the companies supporting the event. The early bird registration fee will be £89 until January 10th. The price rises to £150 after that date. The fee includes entrance to a full day of speeches and panels, lunch, refreshments, evening drinks and admission to the after-show party at a venue in central London.
Posted Dec. 23, 2006

The first big domain conference of the New Year, DOMAINfest Global is coming up Jan. 31 - Feb. 3 at the Renaissance Hotel in Hollywood, California. The show is being produced by DomainSponsor.com. We got the the inside scoop on what will be going on at the conference from DomainSponsor's Director of Business Development, Ron Sheridan. The complete transcript of our interview with him is available in our December Newsletter.
Posted Dec. 22, 2006

Rebel.com has become the first registrar to offer a free service that gives investors a single, integrated management view of their entire portfolio, no matter where names are registered. The company says their DomainMerge dashboard allows easier and more insightful management of any size portfolio, saving time and reducing the cost of portfolio management. Rebel.com CEO David Chiswell said, “we are not afraid to break away from convention if it helps our customers remove some of the complexities involved with managing domains from multiple registrars around the world.” After uploading a list of their domains to Rebel.com, users can sort domains by registrars, expiration dates and domain name servers (DNS), as well as place domains in customized portfolios, assign tags and export detailed reports.
Posted Dec. 22, 2006

Most of you have heard of "domain tasting" by now, but if you are still puzzled by exactly what the practice entails, BusinessWeek.com has published a thorough article on the subject. Their piece focuses on complaints from trademark owners, but they aren't the only ones who have problems with domain tasting which involves snapping up millions of expiring domains names each week, testing them for traffic, then returning those without traffic for a full refund before the 5-day grace period ends. The grace period was never meant for this purpose (it was designed to be a short window where registration errors could be corrected) and many think it is an abuse of the system that should be curtailed (a position we agree with). A few weeks ago, the .org registry convinced ICANN to let them start charging a fee for excessive registrations in an effort to curb this practice with .org domains and we think that is a reasonable solution to the problem.
Posted Dec. 21, 2006

Moniker.com put out a press release today announcing a record breaking financial performance in 2006, fueled in part by their successful live domain auctions at the T.R.A.F.F.I.C. conferences in Las Vegas and Hollywood, Florida. More than $5 million worth of domain were sold at the Florida auction in October. Moniker said their new live auction channel helped the company achieve a 265% sales increase over 2005. Moniker also announced big gains in their registration and parking services. As of December 13, they were the ninth largest registrar in the world (up from 15th a year ago) with nearly 1.8 million domains under management, a 92% year over year increase. At the same time, Moniker said its TrafficClub domain monetization service experienced more than 200% growth in 2006.
Posted Dec. 20, 2006

Are owners of high-quality generic .in (India's country code) domains in danger of losing their names? Many think so after seeing some clearly generic .in domains taken away by INDRP panels (India's Dispute Resolution Policy) in what appear to be successful reverse hijacking attempts by others claiming what appear to be dubious (at best) trademark rights to common dictionary words.  Names that have been taken away from their owners include Hotels.in, Computer.in, Internet.in, Business.in and Jobs.in. This disturbing trend has become a hot topic of conversation at both the NamePros.com and DomainState.com domain forums. 
Posted Dec. 19, 2006

Organizers of the popular T.R.A.F.F.I.C. domain conferences have announced the show will come to New York City for the first time June 19-22, 2007. The event will be held at the Grand Hyatt Hotel in Manhattan which is immediately adjacent to Grand Central Station. Prior to that event, T.R.A.F.F.I.C. West 2007 will be staged at the Venetian Hotel in Las Vegas March 5-8. The last of the three annual T.R.A.F.F.I.C. shows in 2007 is slated for the Westin Diplomat Hotel in Hollywood, Florida next October. 
Posted Dec. 18, 2006

The .TV extension should get a boost from Demand Media's new agreement with .TV registry owner Verisign to administer the extension. Through their registrar, eNom, Demand Media is slashing the standard registration fee from $50 to $20 annually at a new sister site, eNom.TV. .TV also classes some names as "premium" domains and charges far higher prices for those. Demand Media is headed by Richard Rosenblatt (who has already made one fortune with the sale of MySpace.com). He plans to put a major promotional effort behind .TV as an extension for personal video sites. CNN and the Washington Post are among the major mainstream publications that have covered the move and Rosenblatt's strategy to pump new life into .TV.
Posted Dec. 16, 2006

In one of the largest domain name sales on record, Florida's Roy Messer has sold Vodka.com to Russian Standard Company, the largest maker of vodka in Russia. The deal was brokered by Sedo.com. Veteran reporter David Kesmodel, who was the first to report the transaction in his domain blog today, said Messer went to Russia in person to negotiate the sale. Reuters also had a report on the blockbuster deal that will undoubtedly  lead our weekly Top 20 sales chart next week.
Posted Dec. 14, 2006

In the first nine months of this year, spending on Internet advertising jumped a phenomenal 49.2% over the same point in 2005 according to Nielsen Monitor-Plus. David Goetzl broke down the numbers in a column at Media Daily News today (free subscription required to read). Ad spending in all forms of media was up just over 5% from last year (with much of that increase coming from election year campaign spending). While most other forms of media were flat or showed single digit increases, the surge in ad spending on the web was eye-popping by comparison.
Posted Dec. 13, 2006

You see a lot of reports in mainstream media about click fraud, but most experts say the problem has been dramatically overblown by old line media outlets that are losing their advertisers to the Internet. A new article at MarketingPilgrim.com says Google has gone on the record for the first time as saying that the percentage of all invalid clicks there in less than 2%. This is in line with estimates of a 1% click fraud rate made by some panelists at a T.R.A.F.F.I.C. East conference seminar in October. There are newspapers and magazines that would like advertisers to believe the problem is far bigger to dissuade them from taking their money online. Inflated circulation numbers by print media is likely to be a far bigger source of wasted advertising dollars than click fraud.
Posted Dec. 12, 2006

A dangerous fire at Sedo.com's office building in Cambridge, Massachusetts Friday has temporarily shut down the company's U.S. office and access to their customer service phone lines. Emails are being answered but expect some delays as Sedo employees will be working from home until the 17-story building is re-opened. Most Sedo services are based at the company's global headquarters in Cologne, Germany are unaffected. One workmen was killed and dozens of people injured after a transformer blew up in the basement of the building. Sedo's employees were all able to evacuate unharmed. These links will take you to news accounts about the fire: CBS4Boston.com-Fatality and CBS4Boston.com-Injuries.
Posted Dec. 11, 2006

Photon Group Limited is making a bid to take over Australia-based Dark Blue Sea Limited, the parent of  Fabulous.com, a well-known domain company that provides PPC, registration and aftermarket sales services. Photon (also based in Australia) offered 65 cents a share for outstanding shares of Dark Blue Sea which are traded on the Australian Stock Exchange. Photon already held approximately 20% of Dark Blue Sea's stock when the bid was launched. The offer is contingent upon enough shares being tendered to give Photon controlling interest in Dark Blue Sea, 50.1% of the outstanding shares. Dark Blue Sea has issued a response to the takeover bid here.
Posted Dec. 11, 2006

Stephen Michael Cohen, the ex-con who stole Sex.com from Gary Kremen and earned millions of dollars from the theft has been released from prison according to a story at TheRegister.com. Cohen was reportedly released so he could locate the fortune a court ordered him to repay Kremen. Anyone want to bet he skips bail? It may just be a coincidence, but the article says one of the few people with access to Cohen's hidden millions, Mexican lawyer Gustavo Cortés Carvajal, known locally as El Sapo or "The Toad", was the target of an assassination attempt in Tijuana at 5pm on the day of Cohen's release. The wild history of Kremen and Sex.com was the subject of a DN Journal Cover Story last March.
Posted Dec. 9, 2006

Despite almost unanimous opposition from domain registrants and their own constituencies, the ICANN Board of Directors today unanimously approved controversial new contracts for the .org, .info and .biz registries. The action was taken at the ICANN meeting that ends today in Sao Paolo, Brazil. Phil Corwin, Legal Counsel for the Internet Commerce Association, is at the ICANN meeting and sent us this note: "After one hour of discussion the ICANN Board approved this morning by a 13-0 unanimous vote of all participating members to approve the revised gTLD agreements as published in October. Key reasons for taking action at this this time was the failure of the GNSO Council to complete its PDP process on registry agreements and the recent approval of the .com agreement and the consequent desire for uniformity in these agreements. The need to provide incentives for registry investments in security was also a key factor cited by several Board members." While the registration price increases embodied in these agreements is bad news for everyone who owns a .org, .info or .biz domain name, at least it ends ICANN's charade that they are committed to ground up consensus policy-making. The registries clearly have complete control of the Board and their wishes are being granted regardless of the expense to the rest of the Internet community.  See our November newsletter for more background on these contracts.
Posted Dec. 8, 2006

Aftermarket sales giant Sedo.com has formed a partnership with Dotster.com (one of the largest registrars) that will allow Dotster customers one-click access to Sedo’s domain marketplace or brokerage service when the domain they searched is already registered. Integration with Sedo’s marketplace will give Dotster users a chance at acquiring their preferred domain name even if it’s already registered. If the name is not available on Sedo, customers will be directed to Sedo’s brokerage services to help a buyer locate the domain’s owner, negotiate fair market value and legally transfer the domain. Sedo’s partnership with Dotster marks the fifth such integration with a major registrar this year. The company said it sold more than 1,200 domain names through the registrar channel in the third quarter of this year, producing significant new revenue for Sedo’s registrar partners and more transactions for Sedo’s domain sellers.
Posted Dec. 7, 2006

ICANN is frequently the target of complaints about lack of transparency and nothing exemplifies the secretive processes within the group better than the way its Nominating Committee works. ICANN's Nominating Committee decides who gets most of the important positions within the organization, yet no one knows how the committee works or how decisions are made about who is placed in key positions. UK journalist Kieren McCarthy is in Sao Paolo, Brazil covering the ICANN meeting that is currently underway there. He is also operating a site with information on daily events at the meeting. On that site today, McCarthy wrote about the Nominating Committee and his account is a perfect illustration of why ICANN (the organization in charge of the global domain name system) continually (and deservedly) gets beaten up on the issue of transparency.
Posted Dec. 6, 2006

DomainCapital.com has provided more than $1 million in refinancing to the owners of SanDiego.com. Domain Capital is the first financial services company to offer financing and refinancing to businesses based on the inherent value of premium domain names. Domain Capital President Robert Alfano said "by refinancing SanDiego.com, its owners have freed up significant financial resources to reinvest and grow their core business.”  Mark S. Burgess, CEO of SanDiego.com, Inc. said, "we believe Domain Capital is leading the industry into the future where the financial world views a natural city .com domain name as real estate, with inherent and long term value." The recognition of premier domains as valuable assets by financial services companies could have a huge impact on the future growth of the domain industry. Just as mortgage financing makes it possible for millions to purchase real estate, domain financing opens the door for far more individuals and companies to participate in the premium domain name market.
Posted Dec. 5, 2006

If you would like to get a glimpse into daily activity at the ICANN meeting currently underway in Sao Paolo, Brazil, you can check out ICANN board member Susan Crawford's blog posts from the conference. Her entry on the opening day Saturday is here, and her day two post is here. While we are on the subject of ICANN blogs, two independent blogs that are well worth following for insight into the organization that oversees the domain name system are ICANNWatch.org and Bret Fausett's ICANN Blog.
Posted Dec. 4, 2006

The ICANN meeting in Sao Paolo, Brazil opened today and will continue through Friday, Dec. 8. On the last day of the meeting (Dec. 8), the ICANN board is to consider approval of controversial new contracts for the .org, .info and .biz registries that have been almost universally opposed by domain registrants. That pending decision is widely viewed as the most important issue at this meeting as approval could result in much higher domain registration and renewal fees (at a time when providing those services is actually falling). A special website backed by ICANN and operated by UK journalist Kieren McCarthy, has been set up at http://sp.icann.org/ to help everyone follow daily developments at the Sao Paolo conference.
Posted Dec. 2, 2006

ICANN has approved the .Org registry's request to start charging a fee to "domain tasters" (people or registrars who automatically scoop up every deleting domain, test them for traffic, then return those without traffic for a full refund within the registry's 5-day grace period). The start date, exact amount and other details of the new "excess deletion fee" have not been released yet. We would expect other registries to move in the same direction now that .org has led the way in curtailing abuse of the registry grace period.
Posted Dec. 1, 2006

If you've been out of the loop lately, catch up in the Lowdown Archive!

We need your help to keep giving domainers The Lowdown, so please email [email protected] with any interesting information you might have. If possible, include the source of your information so we can check it out (for example a URL if you read it in a forum or on a site elsewhere). 

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