What is the value of a domain name?

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Yesterday, as part of the WHD.Global 2016 conference, I’ve attended an interesting live domain name auction. It was a great experience to better understand this business that I’ve forgot for many years, and to see what’s the real value of a domain name these days.

A short (personal) story

Around 15 years ago, I was working for a small System Integrator close to where I was living. It was my first job in IT, and together with many low-level activities, one of the business we developed and that I became responsible for back in 2001 was Internet Domain Management. We built a couple of DNS servers, I attended a couple of training from the Italian Domain Registry to become an official Maintainer (what’s nowadays called a Registrar) and we started to register domain names and host dns zones for our customers. I learned a lot about the dns protocol, and how to use BIND on linux. Also thanks to this amazing book:

DNS and Bind

At some point, we had more than 2000 zones hosted on our DNS servers, not a bad number for that time and the size of the company. Working with some very large customers, I also ended up to get in contact with their legal offices. No, I didn’t break the law 🙂 Simply, the legal offices were the ultimate responsible for brand protection of those large (and one was a very well known) companies, and domain names were part of their brand protection strategy. They registered any product name in any available extention, and even some mispelled version of the domain name. Just to be sure noone else would register the same domain.

My first (live) auction

Yesterday I attended my first live auction for a domain name. Not the first one ever, as two years ago when ICANN opened the auctions for the .guru domains, I spent 200 USD to get into the auction for virtualization.guru . I was honestly not confident at all I’d get the domain, thinking about how mainstream this topic is, and I was expecting some large organization to make a higher bid. But incredibly, I won the domain and I still own it. Because of my past I thought people would have taken better care of their brand protection, but even after two years nobody contacted me to get this domain. Just like draas.it, another domain I own.

So, when I saw this in the welcome package for WHD.Global 2016:

Live domain.AUCTION

I decided to register for the event and go see it. I even received my own bidder paddle for the action! Not that I was going to bid on any domain tough…

The auction had 34 domains, and for some of them the bidding went pretty good. The biggest bid was 3200 €, and several went about 2000 €. Few interesting notes about the evening:

– few bidders fight heavily on many domains. They were almost always the same people, a clear sign that some are more conscious than others about owning a nice domain name
– some bidders jumped in only for a specific domain name, they bid heavily to let others give up quickly, they usually won the domain they were interested in, and never bid for any other domain. Those people just came to the auction for that specific domain

My final note is a lesson also for the organizers, and in general for people in the hosting business. Dear germans, I usually like you, but you have some times this idea that your country is the world. Sorry, but you’ve seen probably during this event that it’s not. Some domains were presented with a high praise, and they were usually like germanword.cloud or germanword.global. Well, none (really, NONE) of them were sold not even at the minimum price.

In a world were business is global, regardless their nationality, providers are interested in having a true global name, and the de-facto language on the Internet has become English. Something that is only understandable to german speaking people is not in demand, especially with the domain .global. When business is global, you need a name that anybody can understand.