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July 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)


According to a new GroupM research report covered by Joe Mandese in a column at Media Daily News today (free registration required to read), the explosion in Internet advertising opportunities is acting as a damper on the worldwide market for all forms of advertising. That may sound contradictory, but the report explains that new users are flooding onto the Internet so quickly that ad price increases are not keeping pace with audience growth. As a result advertisers are reaching more people on the web for less money. The report also says that in developed countries like the U.S., the Internet now surpasses TV in ad spending increases (37% to 33%).
Posted July 31, 2006  

The Washington Post published an inaccurate and heavily slanted article about Google this spring (prompting us to detail the tactics used by reporter Leslie Walker to fabricate the story in our May newsletter). I had pretty much written off the Post as an unbiased news source after that incident but this week they were talking about Google again, this time in an article by Yuki Noguchi about Google's AdSense program. I was pleased to see that Noguchi stuck to the facts and presented a straight forward account of how people are profitably using the AdSense program. That kind of reporting, uncolored by personal or corporate biases, should be the norm but too frequently is not.
Posted July 30, 2006  

A new report on real estate advertising from Borrell & Associates (detailed in the Center for Media Research blog) says "the proliferation of "free" listings sites on the Internet portends a collapse in the $6 billion print classifieds business, especially with the vast majority of home seekers now using the Internet to find a home. As home sales slowed, the Internet became the most-used method of selling a home." The study says the shift to the web will help propel Internet real estate advertising to the $2 billion level this year and push it past $3 billion by 2010, surpassing newspapers in terms of advertising market share. The summary adds that there is a lot of room for growth since 61% of agents do not advertise on the Internet and 87% of agents are not buying keywords on Google or Yahoo.
Posted July 27, 2006  

Enom announced today that they have purchased BulkRegister in a deal that will make Enom the second largest registrar in the world. The acquisition of BulkRegister gives eNom an additional 1.5 million domain names and 35,000 bulk membership customers. That increases the total number of domains on the Enom platform to more than 6.8 million. The combined company passes Network Solutions to become second only to GoDaddy in total names under management, according to NameIntelligence.com.
Posted July 26, 2006

A report from JupiterResearch released today predicts that online ad spending will soar to $25.9 billion dollars by 2011. Approximately $12 billion was spent online last year according to figures from the Interactive Advertising Bureau. The report predicts continued gains for search marketing which surpassed display advertising last year with 41% of overall spending (display ads took 34% of the pie). JupiterResearch predicts online ad spending will jump 21% this year. Others expect an even higher growth rate for 2006. Universal McCann forecasts a 25% rise while research firm eMarketer says the number will be over 33%. MediaPost's Online Media Daily has more on this story (free registration is required to read).
Posted July 25, 2006

Big news on the .eu front today. EURid, the organization that operates the .eu registry, has suspended 74 000 .eu domain names and has sued 400 registrars for breach of contract. EURid says the move was prompted by abusive behavior from a syndicate of registrars who have systematically acquired domain names with the obvious intent of re-selling them for large profits. EURid said this constitutes warehousing of domains and is a violation of their agreement with registrars who allegedly set up front companies to acquire the domains for themselves. The outcome of the suspended domain names now awaits a court decision. EURid said it wants to make the names available for registration again. More details on this story are available at TheRegister.co.uk and IPWalk.com.
Posted July 24, 2006  

Among young people at least, the Internet appears to have clearly surpassed TV as the preferred medium. According to a new survey of more than 350 college students and recent graduates conducted by Experience Inc., 43% of the respondents said they spent at least 10 hours a week online, compared to only 17% who watched TV for at least ten hours a week. Newspapers and magazines fare even worse, with only 1% of college age media consumers spending at least 10 hours a week reading publications. Experience, Inc. is a leading provider of career services to students and alumni.
Posted July 23, 2006   

Google has been accused of not doing enough to stem click fraud, but an independent report filed in an Arkansas court Friday (July 21) came to the conclusion that Google has in fact taken reasonable measures to fight the problem. This is the case that advertiser Lane's Gifts brought against Google in Miller County, Arkansas seeking compensation for losses allegedly sustained due to click fraud. The two sides (who have already come to terms on a proposed $90 million settlement that is awaiting court approval) agreed to commission the report as part of the settlement arrangement. Alexander Tuzhilin, a professor of information systems at New York University, was chosen to do the study. He said, "Based on my evaluation, I conclude that Google's efforts to combat click fraud are reasonable." Tuzhilin added that indirect evidence he collected via discussions with Google's fraud prevention team supports the conclusion "with a moderate degree of certainty" that the company's invalid click detection problem is "under control." More on this is available at CNN.com
Posted July 22, 2006

This will be music to the ears of domain owners who earn money through PPC (pay per click) advertising. Chris Sherman, the Executive Editor of SearchEngineWatch.com, predicts that prices paid for premium search terms will take a huge jump in the years ahead as more brands adopt search marketing. Sherman was the keynote speaker at the opening day of MediaPost's Search Insider Summit in Keystone, Colorado yesterday (July 20). He told attendees that big brands have just now started utilizing search marketing. Sherman noted that a recent study pegged search advertising at about $5.75 billion, but worldwide ad budgets are currently around $500 billion. "What happens if the big brands decide to move just 10% of that half trillion dollars into search marketing?" Sherman asked. More details on Sherman's talk are available in Erik Sass's column in MediaPost's Online Media Daily today (free registration is required to read).
Posted July 21, 2006

Oversee.net has announced the acquisition of two more privately held domain portfolios. The small niche portfolios included CareerSeeker.com and DreamVacations.com, both of which have high traffic and retention rates according to Oversee. The company says it monetizes more than one million domain names and has more than 100 million unique visitors per month. Oversee owns leading domain monetization company, DomainSponsor.com. DomainSponsor will be hosting the first DomainFest Barcelona in Spain next week (July 25-26). There is more info on that event in our June 30 post below.
Posted July 21, 2006

The Miami Herald has a new article out about direct navigation and the key role domain names play in web search. The story focuses on the experiences of Ft. Lauderdale domain investor Michael Berkens and his company Worldwide Media. They own more than 50,000 domain names that attract around 300,000 visitors a day according to the report. There are also positive comments from major financial analysts like Jordan Rohan of RBC Capital Markets (a close follower of the domain industry who has been a featured speaker at the last two T.R.A.F.F.I.C. conferences).
Posted July 20, 2006

Lee Gomes, a writer for the Wall Street Journal Online, posted an interesting story today about the extent to which the .com namespace has been mined out. The article, "All the Good Ones Have Been Taken - In Domain Names, Too" details research done by Dennis Forbes of Vastardis Capital Services (a New York mutual-fund service company). Forbes sliced and diced the database of registered .com domains to come up with stats that include the most (and least) used words in domain names, the average length of a domain name (13 characters) and much more. It's mostly trivia but, hey, it's domain trivia, so we like it!
Posted July 19, 2006

Online ad spending in the second quarter of 2006 soared 13.8% higher than the first three months of the year, according to a new study conducted by Deutsche Bank in conjunction with MediaPost (MediaPost requires free registration to read the full article). Pricing also increased, with the cost of premium inventory rising 6.6%, run of network inventory increasing 3.6%, and paid search edging up 1.3% quarter-over-quarter. Google dominated the paid search market, garnering 65% of cost-per-click spending. Yahoo! accounted for 25% and MSN took in 8%.
Posted July 17, 2006

According to a new study from the Leichtman Research Group, broadband internet access providers in the U.S. had their best quarter ever in the first three months of 2006, adding just over 3 million new subscribers. In a survey of the top broadband ISP's (representing about 94% of the market), LRG found there are now approximately 46 million high speed Internet subscribers with 25.8 million of those using cable and 20.2 million using DSL. DSL has been catching up rapidly and has now added more subscribers than cable for the last six quarters in a row. In the first quarter of this year, 1.66 million of the new broadband subscribers chose DSL with 1.4 million opting for cable.
Posted July 15, 2006

Ad dollars continue to drain out of old line media and onto the web, but radio doesn't seem to be bleeding as badly as newspapers and TV this year. The latest revenue report from the Radio Advertising Bureau show that total radio ad sales from January through May of this year dropped  1% from the same 5-month period in 2005. Of course, no one in the radio business is doing handsprings over going backwards, but with the huge boom in Internet advertising things could be worse.
Posted July 11, 2006

The website for the North County Times (a regional newspaper serving the San Diego, California area), has an interesting article from writer Chris Bagley about how the domain boom has produced a severe shortage of viable .com domains in the real estate sector. Bagley does a good job of conveying the value inherent in a good domain to his paper's readers so that they can understand why prices can run into 6 figures.  It is encouraging to see mainstream journalists grasp what we've known for a long time and pass that knowledge along to the general public. We'll still see occasional mainstream articles loaded with misinformation about this business, but as more and more media outlets get it right, we're confident that the man on the street will eventually understand why good domains command the prices they do today.
Posted July 10, 2006

Macau.com is one of the five biggest sales thus far in 2006, having changed hands for $550,000 in February. MacauBusiness.com recently released an in-depth article about the transaction that includes an interview with the CEO of the new ownership group. The piece offers some interesting insight into how the high level deal got done and why the name was well worth over half a million dollars to the buyers. There is also an accompanying article about domain investor Chuck Yee who owns VisitMacau.com and thinks it could go for $800,000 even though he hand-registered the domain in 2002. 
Posted July 7, 2006

According to IPWalk.com, the .mobi registry has decided to extend the trademark sunrise period for the new TLD, pushing the end date back from August 22 to September 22. The site said the announcement will come soon, noting that Alexa Raad, Dotmobiís VP of Marketing and Business Development, told them that companies needed more time to fill out paperwork. Raad also told IPWalk the registry wanted some extra time to reach out to the business community and tell them how they can build a new channel with .mobi, an extension that will be devoted to mobile devices.
Posted July 6, 2006

Performics, a division of DoubleClick.com has issued an interesting report on Search Trends for the 1st Quarter of 2006. The report shows that web search advertisers are getting a better return on their investment than ever before. Search ad spending soared over 37% from the same quarter in 2005 while the advertiser's sales rocketed by 72%! The report also showed that web surfers are searching on a wider variety of keywords with the number of keywords receiving at least one monthly click or conversion shooting up 36% in the past year.
Posted July 4, 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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