The domain name industry is all abuzz today (or will be soon) with the launch of a new service called NameJet. The service will compete in the $75 million/year “deleting domain name” business - when someone doesn’t renew a domain name it goes through a lengthy expiration process and is eventually spit back out to the market. 25,000 domains delete daily on average, and a lot of those (about 8%, to be exact) are immediately re-registered by domain speculators.
A number of companies compete to get those domains and then resell them via auctions. The most successful was a Portland startup called SnapNames, which won largely because they locked up agreements with the big registrars to get exclusive access to deleting domains. SnapNames and its competitors would then auction off deleting domains, generating an average of $100 per domain (with some going for $100k or more).
SnapNames was recently acquired by Oversee.net for $35 million, based on yearly revenues of around $40 million and profits of $3 million or so. About half of that revenue, and all of the profit, came from a single exclusive Snapnames’ registrar partner - NSI. A small portion of the purchase price was held back in escrow based on the company meeting revenue projections of $70 million/year.
That acquisition looks a little dumb right now, and those revenue projections of $70 million/year aren’t going to happen. NSI, exercising a change in control termination clause, notified Snapnames/Oversee today that they were terminating their agreement and simultaneously launched Namejet with a rival registrar eNom (eNom is owned by Demand Media).
Congratulations to the SnapNames shareholders, who sold at exactly the right time and left Oversee.net holding a now unprofitable business.
Disclosure: I once ran a company in this space called Pool.com, and later briefly consulted for SnapNames.
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must appreciate the way ppl keep finding sources to generate income, but I believe in generating wealth over income
I don’t know a single person who likes these companies and doesn’t work there or gain any benefit (money) from them…
Having these companies make money simply because people want a domain that fits their business is kinda sad.
I almost wanna register 1000 versions of theDatingReport.com thru a registrar that I negotiate an agreement to resell.
People love to get rich thru gimmicks
They love going to conferences where these gimmicks are shared. Tell people what you really did to make money over time and its like finding people reading during “reading week”- it just doesn’t happen.
I wonder how guilty of gimmick vs good I am…
People may be opposed to this but you cannot deny the value of these services.
I could go to snapnames and find a domain that is expiring that has a good name, good age, and with thousands of backlinks all for 100 bucks. Most of the domains get purchased end up being parked and its amazing to see the amount of money parked domains generate. Many others turn into SEO type link farms and adsense sites. One of the main benefits od Snapnames partnership with NSI was that the domains age did not reset when it expired. This meant that one could obtain a domain that was registered back in 97 and therefore carrying some decent SEO value.
I was in an auction for the domain rumble.com and it ended up going for 31k and is just parked. Crazy.
“NSI, exercising a change in control termination clause, notified Snapnames/Oversee today that they were terminating their agreement”
Interesting. Is there a press release on this or one of your inside sources?
What sometimes happens to those domain names with pageranks 4, 5 or even 6 is that they will sometimes be developed into blogs or directories or one page word links.
Usually those owners will sell links to make instant money from Webmasters attracted by the pageranks
But they can be a jump start for a Web business seeking to get an online presence without starting their promotion from the very beginning. But it is best that the new Website be topically related to the old one for the backlinks to be effective since backlink anchor text is what determines rankings nowadays on search engines
Who woulda’ thunk?
AGAIN. In ten, twenty, thirty years these domains will be worth month than they are today. Ask Mike Arrington how much the url Pool.com is worth?
Mike,
YOU ran Pool? I have been reading your blog all this time and never knew you were in the domain business. I have used all of these services for years. I loved pool, but they screwed me a couple of times, and have not used their services since. The biggest problem: monopoly of .Com domains.
In fact that is why I started OpenDomain: to do something GOOD with domains. I buy domains and then let people use them for FREE. Last year I donated Drupal.Com to Dries, and recently EcmasScript.Org to Eich. BUT… I have to admit my idea does not work in that i costs WAY too much with little return. Still pretty kewl that a guy like me can help some of the biggest sites on the net.
Hi Michael,
Is it possible that you create a separate feed for each of the writers of TechCrunch?
Sonome
Very informative article. Nobody knows the domain squatting business like Mike A.
My, how the cookie crumbles!
Some of the things that I’ve seen DomainSponsor do in the past made me view them more on the unethical side of the parking spectrum. It’s interesting to see this take place. I guess they get a taste of what it’s like when someone does something bad to you.
This article was very interesting!
i love it , i hate oversee.net. They used one of my domains and put ads on them without my knowledge and seeing a cent.
Karma. Take that you &&*U(&.
Yo, personally, I give Mike Arrington a lot of credit for having a background in domaining. All that back-room Internet marketing stuff is hard. The people that build big domain/affiliate/ad businesses in their basements with zero capital are super smart, and most startup people couldn’t hack it at all.
No typo or domain squatter has made a dime from me.
#16
Really. Maybe these smart squatters will just spam your url: http://blog.wajsbrem.com/
They may have cost me a dime or two when compared to some reality where the domains I have wanted were available or when I was spared the time moderating the comments from the likes of Alex.
Oversee.net also just pulled the plug out of the company SwapNames (with a ‘w’ instead of an ‘n’) by suing them over trademark infringement. What were they so afraid of?
Obviously none of you know how much DomainSponsor makes per *DAY* from their parking business. Hint: take your house price and maybe triple it.
Interesting post… I wouldn’t label oversee.net as getting hosed.They are in a sweet spot and executing right. Funny how they have grown to a 150m rev company from their own pockets. Yet, demand needs to rais 300m+ to open eyeballs. Snapnames is just a start to what oversee has to come. They have a brilliant management team, and will be the leader in this market
i went to namejet,i found it a domain exchange site.i found 0012530.com,020china.com.i think it is used for china.but i think nobody would buy it.
Ouch, that’s really gonna hurt.
agreed with kyle. “hosed” seems to be a bit overstated….ive heard that oversee.net is on pace to do 250mm this year. snapnames 35mm may hurt a bit, but this company still seems like the best kept secret out there i’ve heard of….
@ #1: Take a stream of income, grow it at a 25%+ CAGR and sell at a nice multiple to the income statement… that is a definition of wealth creation.
I don’t take this whole purported drama at face value at all. Knowing some of the guys at Snap/Oversee, to think they didn’t see this as a potential risk and not have two or three contingency plans for growth (see Snap Live Auctions news release) is a little bit … well .. just being a bit drama queen don’t you think? I’d like to see someone else who can build an immensely profitable $250m business with $0 outside funding tell me they’ve never had a minor setback.
Michael who?
hi can you sugget few names which are suitable for manufacturing industry
thanks®ards
ravi
well, the domain speculators have always led the domain market, and they are actually the ones who are giving a major heat to the domain process. Without them, the domain industry would be nothing but a regsitrar-led bazar which is bad for everybody.
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SnapNames.com - Scam Company & Shady Registrar Partners - Protondomains & Media Web Plus
ICANN has to do something about Snapnames and their Shady Registrar Partners - Protondomains & Media Web Plus, and what they get away with.
For several months we’ve had to contend with registrars that includes Directnic, Intercosmos, DirectI, Snapnames, Protondomains, and now Media Web Plus.
Back in July, My company asked DirectNIC/Intercosmos (through emails and faxes) to release a specific inactive and parked domain name to the public because of our trademark. They did so by expiring and deleting the domain (Thank you Intercosmos!) and we waited patiently for over thirty days to purchase the name when it became available.
Snapnames grabbed it first through their domain drop and snatch service and then auctioned it off to THEIR shady registry partner and SUBSIDIARY - PROTONDOMAINS. According to Whois:
“Domain Name: *.COM
Registrar: PROTONDOMAINS.COM LLC
Whois Server: whois.protondomains.com
Referral URL: http://www.protondomains.com
Name Server: NS1.SEDOPARKING.COM
Name Server: NS2.SEDOPARKING.COM
Status: ok
Updated Date: 20-dec-2008
Creation Date: 10-dec-2008
Expiration Date: 10-dec-2009″
So first it was under the name of DirectI, a company in India. We called them, and they informed us that they weren’t the owners, and then we contacted Oversee and they said that the domain name was being managed by Snapnames under its subsidiary: Prontodomains.
We then made numerous attempts to reach Protondomains. The Whois information was incorrect, so we made a formal complaint with ICANN about their phony Whois information. The recently restored accurate information to the whois, so hopefully we’ve led to helping to prevent them from misleading the public in the future.
We made attempts to contact KJEL HOLMBERG over at Snapnames, but he hasn’t replied since December of 2008 (It’s now approaching April 2009), only to our surprise that Protondomains might share an office with the folk at Snapnames.
Recently, the name was sold to or registered by MEDIA WEB PLUS, cybersquatters in the search optimization business. We did reach out to them and they have asked us for $5000 for the name and then to f*ck off when we refused to pay. We forwarded their request as well as our response to legal@moniker.com. I spoke to a couple of folk at Moniker, as they were the only ones answering their phones and they were wondering why Snapnames hadn’t responded to our voicemail messages and emails.
Next We learned that the same domain name is on the Moniker marketplace being sold for $1600 as of 1:38PM EST. Dec. 22nd, 2008. We were confused and so we contacted their customer support line and Moniker explained that Media Web Plus is most likely involved in a practice that is in likelihood violating their terms and agreement as customers of theirs. The domain name also appears on the SEDO marketplace for an unknown bid amount.
All we want is our name. Media Web Plus along with SEOSEO and OnlineDomains.mobi are also the owners and administrators of websites that would tarnish our brand name, and for what, so they can make a quick buck?
We have rights to THIS domain through our business registration in the State of New York and we hold a USPTO trademark and relevant pseudo-mark registration for THIS name, and have engaged in commerce under THIS name, and we were also issued a Tax ID by the IRS number under THIS name and will be filing for our company 2008 tax returns under THIS name.
On March 26, 2009, Media Web Plus informed us that the name will be sold through SEDO. That means they’ve had literally no traffic on the name and have been attempting to sell it for their outrageous sum since December 22, 2008!!!
This was our response (sent the same day):
“As I mentioned on my previous email, we have a trademark for the name, so anyone who, to their misfortune purchases the name, we will inform them of our rights over the name and what they do from there to get there money back is up to them. I don’t think it’s even fair for them to be buying into a domain dispute and then delivered cease and desist letters by our lawyers. As long as they want to engage in any activity involving the United States, they’ll be confronted by the USPTO as using our name illegally. Who wants that? Is that worth $5000?
There’s a reason why it has taken you so long to sell the name. No one wants it and would have to be reckless to buy it if they did their research. We are cool with buying the name for a $100 and that’s it - quick & easy. We already have money set aside for the legal fees and arbitration fees to pursue this issue from start to finish.
Do what you have to do in the name of business and commerce. Best of luck to you and I hope you guys are successful in your accomplishing your wishes and hopes. We will still always be {inserted domain name}, and doing good by that name for all our world’s kids.”
We want our name and won’t stop fighting until a transfer is made.WE sent ALL our supporting documents to the above parties, and we will not send them again. We wanted to avoid an arbitration process (it’s expensive), but it may come to that. However, we will make sure that any customer, ICANN and anyone who has to deal with SNAPNAMES, PROTONDOMAINS, and MEDIA WEB PLUS will find this board posting, and be fearless in the pursuit of their dreams.
Fight them!!!
Anyone wishing to contact me about resolving this matter or have any questions or tips, please do so (to avoid spam) through this site’s messaging process. We will get back to you as soon as we can.
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Email addresses of those mentioned in this posting. Contact them if you face similar issues Good luck future business owners and social entrepreneurs, and thank you ICANN for establishing new policies against those who are a part of why our US economy is bad. We need more oversight and regulations. This issue has made me an advocate for them. Here are the email addresses you won’t find as available on the web:
Also try:
Attn: Legal (Moniker)
1600 Southwest 4th Avenue, Suite 400
Portland, Oregon, 97201
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If you have trouble with MEDIA WEB PLUS, their public whois information (made public) is:
Registration Service Provided By: MANAGE.SNAPNAMES.COM
Contact: +1.5034595739
Website: http://Manage.SnapNames.com
Domain Name
Registrant:
Media Web Plus
nidal elkadri
125 marcel chaput
gatineau
qc,j9a 3b3
CA
Tel. +1.8197761113
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Kjel P. Holmberg
SnapNames, Business Development Manager
115 NW 1st Ave, 3rd Floor
Portland, Oregon 97209
503.219.9990 ext. 236