posted 12-09-1999 12:09 PM         

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> dude, if that's the case, then NSOL could easily (or maybe with some difficulty) take it away from him after Congress' recent ban on cyber-squatting.

Not true. There's no law against taking a domain name with the intention of reselling it later (nor should there be), unless there is a single other entity which has a prior legal claim to that domain name, by virtue of a trademark or service mark. The word 'drugs' cannot be trademarked, because it is merely descriptive, and so this guy has no worries that the domain will be taken from him. (After all, do you think he would've paid $800K for it if he thought there was a chance it could be taken from him?)

posted 12-09-1999 11:52 AM         

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dude, if that's the case, then NSOL could easily (or maybe with some difficulty) take it away from him after Congress' recent ban on cyber-squatting. Enforcement though is key.

Charlie1 - not necessarily. Once you incorporate your company name (copyright it) and make money off of the name, other companies can't take the same name. I understand that things have been a little different in the Net world, but a domain name with a different extension has nothing to do with the actual business name of a company. Though in the business.com situation it's kind of tricky - if they inc. themselves as 'business.com', it is completely different than someone else naming themselves 'business.net'. But if you could somehow name yourself 'business' (which is a horrible name, and you probably couldn't anyway), then after making money, you would have rights to all the extensions. This is what I mean by saying a good name is truly invaluable.

posted 12-09-1999 09:35 AM         

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smario,
I was saying that I didn't believe a good domain name was necessarily always going to be as good beacuse of internet keywords or because of new extensions for domain names such as .web. A good name can't be replaced, but if someone else gets the keyword Business or business.web and either of those catch on it'll certainly be taking users away from business.com.

dude, i agree with you on the drugs.com vs. drug.com. Drugs.com seems like it would be a lot easier to brand. The bid on drugs.com was about 4 or 5 months ago and i'm sure the market for all domain names has gotten a lot more expensive in recent months.
What makes you think the guy who bought drugs.com has the intention of selling it? Did he say that's what he did?

posted 12-08-1999 05:46 PM         

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JHirsch,
In my opinion drugs.com is a lot more valuable than drug.com. Drugs.com is a natural fit for an online drugstore, whereas drug.com would work too but not quite as well. The fact that someone bid $500K for drug.com just tells me that the guy who bought drugs.com a few months ago got a very good deal (in fact, he bought it with the intention of reselling it).

Scanning through the GreatDomains list, I do see some domains that really aren't that expensive (in the grand scheme of things): pager.com ($150K), rate.com ($176K), selling.com ($50K). (I don't know how GreatDomains works, so I'm not sure if you can actually buy them for these amounts... it might be that they just keep asking people to bid until it reaches a price the seller agrees to, in which case you'd have no way of knowing how much any given domain would cost.)

posted 12-08-1999 03:55 PM         

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>Especially online, where people can find you by accident or typing in a few key words. You can't do that offline, which is why a generic name would never fly.<
I have to agree here. A company called business inc. or books inc. would not do too well, but in the world of keyword searches generic words are better because of the ones who don't know any better will just type in the word.

Here's an interesting thing I read on the GreatDomains site...
Drug.com is up for sale at $500,000 while Drugs.com already sold for $823,456.
Is drugs.com worth more? It rolls of the tongue more easily. I wonder if people search for plurals more often than singular words on the internet? Maybe it depends on the word.
Which would you rather have? drug.com or drugs.com. Of course in the end the $300,000 or so between these prices will probably be such a minor part of the overall budget that it really won't matter.
Jake

(as an aside, sports.com which i mentioned in my first post is actually owned by Sportsline and it is supposedly the most viewed site in Europe. It grew by leaps and bounds right out of the gate before the content was very good according to an article I read. That might have had something to do with the great domain name it has)

posted 12-08-1999 11:37 AM         

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lockin, I just heard a rumor that the owner of america.com was just offered $10 million and turned it down! Not sure if it's true, but it wouldn't surprise me.

charlie1, I agree that RealNames has the potential to undermine the value of a great domain name, but the fear might not be warranted. I look at RealNames almost as a fee-based search tool (the fee being charged to the site, not the user). In the worst case scenario, RealNames becomes so popular that people forget that URLs exist and just type in an internet keyword when the want something. But companies will continue to advertise and will continue to spend money on branding, and those ads will stress the domain name at least as much as the internet keyword (similar to the way some ads mention their AOL keyword). This would be especially true of internet companies that have added '.com' to the end of their company names.

posted 12-08-1999 09:10 AM         

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We can make a thousand arguments for why it is not a good idea to spend that much on a name. However, as much as I hate to admit it, the proof to the contrary is there. These have been good investments - i haven't heard of a single bad one yet. And I think it does give some instant credibility, especially to the really pricey ones (those in the millions). Anyone with $7.5 million to spend probably got it from past successes, the current business, or venture capital - money that would not be spent haphazardly. I doubt this money is ever family money being used on a whim. So these people probably are serious and not just getting the name thinking a yet-to-be-thought-up business plan will come naturally.

Regardless, everything on the net is new and constantly changing. The only thing that won't is a good name, and it's a great place to start your investment.

posted 12-07-1999 03:27 PM         

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> It reminds me of that online jobs company that spent half of its yearly budget on one super bowl commercial last year. Sure they got alot of hits, but would they have grown more if they had more money to spend in other areas? <
Apparently, they (HotJobs) think not, because they're running another ad in this year's superbowl. Interestingly, last year the response from the superbowl ad was so big that it crashed their server... I guess they didn't have enough cash left over to pay for a hardware upgrade

> Also, in terms of branding, I think it's pretty naive to believe that it's automatically easier to 'brand' a known word like 'business' versus unique names, or even made-up words. I would even argue that it's sometimes harder - common English words have such an entrenched meaning for many people, that it will be really hard to alter these meanings so that they think of your business rather than the object/literal definition. <
Made-up words vs. descriptive words: there are obviously tradeoffs. But I believe that the scales are tipping toward descriptive words. Branding a made-up word (Fedex, Xerox, etc.) takes many years and/or many millions of dollars. For most startups, this just isn't in the cards. As long as the startup focuses specifically on the word(s) in its domain name (ex. if Pets.com doesn't branch out into offering CDs), it really does get a free ride. I'm trying to think of a niche which has two startups of approximately equal strength, one of which has a descriptive name and one of which has a made-up name. That way we could watch things play out and see which is better. But there are too many other factors at work to make it scientific. The only good example I can think of is in online wedding registries: weddingchannel.com (descriptive, backed by Idealab) and della.com (made-up, backed by Amazon). We'll just have to wait and see which one grows faster...

(By the way, Network Solutions charges $70 for two years, not $150... which makes your point even stronger.)

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