April 29, 2005 -- (WEB HOST INDUSTRY REVIEW) -- The recent death of Pope John Paul II led speculators to buy up domains related to names the new pontiff might take. Blogger and technology author Rogers Cadenhead recently told research and analysis firm Netcraft (netcraft.com) that he had engaged in "popesquatting," registering six domains with names he thought the new pope might take. And others speculated several years ago, with JohnPaulIII.com registered in 1999 and JohnPaulIII.net purchased last November.
After Cardinal Joseph Ratzinger was named the new pope, taking the name Benedict XVI, domains related to the name quickly appeared for sale on online auction site eBay (ebay.com). The PopeBenedictXVI.com domain was reportedly for sale on eBay with a starting price listed at $100,000 and a "buy it now" price of $250,000.
This speculation raised the question of whether owning domain names could be a profitable enterprise. The cost of speculating is certainly low, but as Netcraft points out, in this particular case at least, there is little chance that the Vatican would pay for any of these domains since it is controls the .va domain.
Cambridge, Massachusetts-based Sedo (sedo.com) however, could have an answer for domain name owners looking to profit from their ownership of Internet real estate.
In addition to registration services, Sedo runs a domain name marketplace, where registered or "used" domains can be offered up for sale. "We provide a domain marketplace, sort of like eBay, a central place where people can come and post things for sale," says Matt Bentley, CEO of Sedo. He says there are over 100 domains with the term Benedict for sale in its marketplace, with asking prices ranging from the "high hundreds" to "low thousands" of dollars.
And almost anything that happens in the world can trigger speculative domain name purchasing. "Every time there is an event that pops up in the news, or something that becomes popular or a term that's in the news for a few days, a few weeks … you'll immediately see people jump in on that trend by registering that domain name," he says.
Before domains are sold, the traffic they generate can be used to generate revenue. Sedo helps customers do this through a domain parking program, which provides the customer's domain with a Web page containing targeted ad links generated by Google Adwords. Domain owners earn a share of each click on an ad, splitting the revenue with Sedo. There is no cost for the parking service.
"We will help [domain owners] to monetize the traffic that a domain name receives," says Bentley, "basically we'll make a page, put up some relative advertisements … and the domain owner makes money by receiving clicks from the page."
The pages, hosted by Sedo, are computer generated. It treats the domain name like a search query in Google, explains Bentley, and places ads on the parked page that are related to the search query.
"Anybody that has a domain name … can within a few seconds get a parking page like this that has relative advertisements," says Bentley. "How much traffic the domain drives [determines] how much money you make."
Sedo is careful to facilitate only the sale of legitimate, non-copyright infringing domains – something that has become easier with the increased regulation of the industry, says Bentley. According to the domain name dispute resolution policy, trademark holders are permitted to recover domains registered by other parties that violate copyrights. All trademark complaints are reviewed by Sedo, which will drop the listing if the complaints are found to be legitimate. The company has a similar policy in place to protect domain owners from domain theft or reverse domain hijacking.
Sedo also offers domain acquisition services, helping customers find domains it doesn't have for re-sale in its marketplace. The company says its success rate is 70 percent. Other services include domain name appraisal and the operation of watchlists - a service that monitors the domain market for addresses that match customers' requests.
