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The Death of Domain Parking?

An anonymous reader found an article about the former CEO of MySpace moving into the domain parking biz. He says "I thought, it can't be that easy. So I talked to some domainers, and they said, 'We own 300,000 domains, we make $20 million a year, we have just four employees and some servers in the Caymans.'" The idea behind the business doesn't really seem any better to me than just having a parked name with a banner ad. At least, not for the internet as a whole.

23 of 296 comments (clear)

  1. One can only hope. by SatanicPuppy · · Score: 5, Insightful

    Domain parking is just another form of internet garbage, like half-assed "portal" sites, and spam.

    It's only sense to know that there will forever be garbage, and that we will forever be looking for ways to sort through that garbage for the good stuff.

    Looking at it, you'd think that domain parking wouldn't be half as profitable as it is. We clearly need to work harder on our search engines.

    --
    ad logicam Claiming a proposition is false because it was presented as the conclusion of a fallacious argument.
    1. Re:One can only hope. by markhb · · Score: 4, Insightful
      We clearly need to work harder on our search engines.

      Given that the real source of traffic for these sites has nothing to do with search engines (it comes from people typing stuff directly into the location bar of the browser), I doubt that that would be productive.
      --
      Save Maine's economy: write stuff down. All comments are exclusively my own, not my employer.
    2. Re:One can only hope. by EggyToast · · Score: 4, Insightful

      Or remove the advertising incentives. They only make money because companies like Google and Yahoo pay them. To me, that's no different than the "aggregator" sites that are just links and news about asbestos.

    3. Re:One can only hope. by Anonymous Coward · · Score: 1, Insightful

      I've been trying to find a decent .com domain name for some time now. I am firmly convinced that domain squatters (for that is what they are) are methodically working their way through the entire namespace, starting with every possible four and five letter combinations that are available. As you say, even totally random domains are taken, and if you visit the site they are often "parked" (Read: squatted).

      In theory it will take them years to cover the five-letter domains, and much, much longer to cover the six letter domains: but that only holds if the number of squatters remains constant. Which it will not.

    4. Re:One can only hope. by dave562 · · Score: 4, Insightful
      Furthermore, most people [who know how to use the internet] search for websites rather than type them in the location bar because they usually don't know exactly what they're looking for.

      I corrected your comment for you. I have seen numerous people who don't really understand what a web browser is who try to type what you and I would call search queries into the address bar. Parked domains and phishing sites target those users who simply don't know any better. Beyond that, there are parked domains with names similar to every single popular website on the internet. I seem to remember Craigslist.com being a porn site. The other day I was looking for "Curse Gaming" to download some WoW addons and sure enough, cursedgaming.net, cursegaming.net, cursedgaming.com, etc. all came up with webpages. Luckily Google is smart enough and by searching for "Cursed Gaming" I got "Curse Gaming" which is what I needed. Oddly enough, all those subtle iterations on the domain don't show up as results on Google.

    5. Re:One can only hope. by Kelbear · · Score: 2, Insightful

      I don't think the parent should really be modded insightful. Making Firefox the ad-less browser makes fire-fox compatibility pointless at best, and damaging at worst for many websites that offer content or services for free if their revenue stream is ad-dependent.

      Advertisements aren't always a bad thing.

      I do have adblock installed, but I use blocking judiciously. I only block advertisers that are instrusive or obstructive. If the ads don't hassle me, I don't mind seeing the ad on the off-chance that it may have something of interest to me, benefitting both me and the advertiser.

    6. Re:One can only hope. by Sparr0 · · Score: 1, Insightful

      any sensible browser configuration doesnt need a search bar. anything in the address bar thats not a domain name goes to a search engine. how hard is that? saves a lot of screen real estate (that google search box isnt small), and makes things easier all around.

    7. Re:One can only hope. by naChoZ · · Score: 2, Insightful

      Me: OK, go to www.dimspace.com
      Them: OK, I'll search for that. I'm on Yahoo.

      Absolutely. But the funniest part is the way they say it. "I'm on Yahoo," with that subtle tone indicating they fully expect your next question to be wondering aloud what year they graduated from MIT.

      --
      "I can be self-referential if I want to," said Tom, swiftly.
  2. If it's real, then it's temporary by inviolet · · Score: 4, Insightful
    'We own 300,000 domains, we make $20 million a year, we have just four employees and some servers in the Caymans.'

    If that truly is the economics of the situation, then it is necessarily temporary. The market always adjusts when the opportunity arises to carry off so much wealth for so little actual effort.

    Perhaps the adjustment will come in the form of higher DNS fees, since the 'business' in question is so heavily relying on DNS services.

    Perhaps the adjustment will come in the form of higher domain-name registration fees, once the authorities fully grasp the nature of the free-riding involved.

    Perhaps the profit per wayward surfer will drop as the sponsoring sites gradually pay less and less per click.

    Or if this is truly a market failure, then watch for new legislation. (Not that past legislation bothered to wait for a justifying market failure to arise; indeed, the legislature is always willing, and a market failure is just what it needs to explain actions it wanted to take anyway.)

    --
    FATMOUSE + YOU = FATMOUSE
  3. stupid headline, stupid article by Thaelon · · Score: 5, Insightful

    Article title: "The death of domain parking?"
    Article body: "unrelated information"

    Article comes free with idiotic terms like "domainers" (not a word) when what they mean is "squatter".

    It's just a euphemism. Anybody with a brain will see right though it. It's no better than calling URL spammers "search engine optimizers".

    --

    Question everything

  4. Google does evil by wytcld · · Score: 5, Insightful

    A professional society I belong to has just gone to set up a website, and discovered that its acronym is being squatted on by a "domainer" - no content at all there except for Google ad links to misc. stuff not even related to the acronym.

    We have hundreds of thousands of domain names that could effectively and efficiently be used by real organizations as the most direct and obvious addresses to connect with them, but are instead being subsidized by Google to effectively obfuscate the Net. This means that if you really want to find a firm's or organization's site, you increasingly have to use Google to find the domain name they've settled for, since the obvious ones are taken up by these Google-subsidized squatters.

    Google does evil here, and for their own ends. It would be simple for them to set standards as to where their ad links can be placed, and put this whole lecherous horde out of business, freeing up the domain name system to work according to its original design. What are the odds Google'll ever even consider this? Slim to none, because Google does evil. They're stinking rich, but they just want more, by any means, even when those means degrade the quality of much of the Web.

    --
    "with their freedom lost all virtue lose" - Milton
    1. Re:Google does evil by Antique+Geekmeister · · Score: 3, Insightful

      This is hardly a Google problem. It's ICANN, and specifically Verisign for selling huge numbers of domains so cheaply, and making it so very difficult for a legitimate user to protect themselves or recover from a domain squatter. They also deliberately leave it very awkward to track the domains back to the squatters, making blacklists or automatic filters quite difficult to construct or keep up to date.

  5. BS by geekoid · · Score: 4, Insightful

    If I see a piece of land, and think "McDonalds will want to put a franchise here." and then buy it, I'm a forward thinking business man. If I do the same thing on the internet, suddenly I'm some sort of 'bad' guy.

    It's just people making money by thinking ahead.

    No, I am not one of these people, but wish I had gotten in when I thought to do it in the 90s. I could use 20million a year with less then 3 million in expenses.
    damn.

    --
    The Kruger Dunning explains most post on /. http://en.wikipedia.org/wiki/Dunning%E2%80%93Kruger_effect
    1. Re:BS by llZENll · · Score: 2, Insightful

      It's totally different. Land is tangible and limited. Domain names are not. Land only has value because of other land around it, except for minerals and such, but all of that land is gone anyways. Domain names have intrinsic value. And finally and most important, land is TAXED, domain names are not.

    2. Re:BS by cdrguru · · Score: 3, Insightful

      No, the problem is that Google enables these people to make a return on their "investment". If you buy some land in the hopes of selling it at a premium about all you can do is something constructive with it while you are waiting.

      Instead, what Google has enabled is to turn this wasteland into a money-making opportunity for these folks. Take away the ability to put ads in this space and it will dry up overnight.

  6. There is no market economics in this by Solandri · · Score: 4, Insightful
    'We own 300,000 domains, we make $20 million a year, we have just four employees and some servers in the Caymans.'

    If that truly is the economics of the situation, then it is necessarily temporary. The market always adjusts when the opportunity arises to carry off so much wealth for so little actual effort.

    A friend of mine does this. There is no market economics involved because domain names are monopolies. If you own a domain name, nobody else does. If someone wishes to advertise on it, they have to pay your terms for it. If someone wishes to buy it, they have to pay whatever price you set for it. It's actually a lot like real estate, except most of the land got bought up by a few hundred individuals when the price was $10 a lot.

    Perhaps the adjustment will come in the form of higher DNS fees, since the 'business' in question is so heavily relying on DNS services.
    Do that and you 1) kill off most of the web, 2) make multi-millionaires out of whoever runs DNS. Everything relies on DNS.

    Perhaps the adjustment will come in the form of higher domain-name registration fees, once the authorities fully grasp the nature of the free-riding involved.
    Domain registrars are in a similar business. They offer to make trivial changes in a database for you for an annual fee. Increasing the registration fees just transfers money from the parkers/squatters to the registrars. Increasing the fees registrars pay just transfers money to Network Solutions.

    Perhaps the profit per wayward surfer will drop as the sponsoring sites gradually pay less and less per click.
    The amounts sponsoring sites pay per click will depend on how many sales they get per click. It has nothing to do with whether or not the domain is being parked/squatted.

    Or if this is truly a market failure, then watch for new legislation. (Not that past legislation bothered to wait for a justifying market failure to arise; indeed, the legislature is always willing, and a market failure is just what it needs to explain actions it wanted to take anyway.)
    Like I said, there is no market economics in this. It's a side effect of the artificial (but necessary) monopoly created with the concept that a person or corporation can "own" a domain name. The only way to avoid it would be for a central authority or government agency to go through domain-name-space and regularly "clean up" any domains that were obviously just being parked for clickthroughs.

    The one idea I've thought of which could prevent this is to make it progressively more expensive to own more domain names. e.g. The first 10 domain names are $10/yr each. Domain names 11-50 are $100/yr each. Domains 50-100 are $1,000/yr each. And so on. There really is no need for any one person to own more than a dozen or two dozen domain names, at least without good financial incentive. True you could set up a sprawling network of shell corporations and paid underlings, but the paperwork necessary to maintain them would quickly become overwhelming without incurring additional costs.

  7. domain parking should be banned by havenskate · · Score: 2, Insightful

    When I read the subject of this I got excited. I thought maybe, just maybe there were going to be some rules set about how long you can park a domain for -- making it more of a hastle for scammers and squaters to just sit on domains with nothing more than an ad on the site... I'm normally not one to opt for control, but if I can go out and buy just about every mispelling of microsoft or google or whatever possible and sit on them or even have them forward to my site, well that just seems crazy. and if you're rich from selling a business, internet land is cheap... dirt cheap... do we really want a warren buffet of the world to own everything?

    I admit that I haven't researched what regulations do exist, but I'm not aware of anything in place to prevent this besides the cost (which is not much as the article mentions)...

  8. real-estate speculators are NOT businessmen by Comboman · · Score: 5, Insightful
    If I see a piece of land, and think "McDonalds will want to put a franchise here." and then buy it, I'm a forward thinking business man.

    No, you're a real-estate speculator not a business man. Businessmen create and run businesses, generate employment for others, service their customers and stimulate the economy. Real-estate speculators, currency traders, domain squatters, ticket scalpers and people who sell PS3s on eBay are just ignorant jerks who are gaming the system to enrich themselves while providing no useful service.

    --
    Support Right To Repair Legislation.
  9. Nonsense by amyhughes · · Score: 2, Insightful

    You don't understand what's being discussed. As a "domainer" you didn't buy the lot to later sell it to McDonalds, you bought the lot so McDonalds can't. You put billboards up, instead. That's even less useful than McDonalds.

  10. Re:Not 'right' or 'wrong,' just not interested. by nixkuroi · · Score: 2, Insightful

    You also have to realize that if Firefox included an ad blocker for all ads, many content providers that survive on ad revenue would stop developing for that browser. It would take a lot less time for most developers to write pages that only have to worry about IE. It's still got the greater market share and it costs extra money to comply with both browsers. If you knew that you were spending money to accommodate traffic that was going to eschew your revenue generator, would you continue to spend that money?

    Probably not.

    Firefox realizes that. They make it possible to plugin and block ads, but making that a default setting would marginalize them in the eyes of ecommerce developers and as soon as that happened, they would be marginalized in the development process.

  11. Re:This comment parked by Baricom · · Score: 2, Insightful

    Sure 99% of domains would be dropped. However, a huge chunk of that number would be legitimate domains used by ordinary people. I own a domain which I use to host a blog, and small tools designed for public use. I make essentially zero revenue connected with it - a total gross of about $10 over four years. If the price of a domain was raised to $50, I would be priced out of the market, as would many other legitimate owners and even some small businesses. The web would become the territory of the wealthy - exactly what the media conglomerates want.

  12. Everyone should search on 30 domain names per day by Anonymous Coward · · Score: 1, Insightful

    Everyone should search on (at least) 30 new domain names per day

    Fill the bilges with swill - keep searching - keep searching - keep the scoopers busy...

  13. Re:This comment parked by jez9999 · · Score: 3, Insightful

    Woahh, woah, hang on. Where the hell do you live, Africa? This is a ridiculous argument. You almost certainly make enough money to fund a measly $50/yr for your TLD. If it's not worth even that much to you, you should be asking yourself whether you even need it and considering getting a subdomain from a hosting provider or something; you can probably get them for free somewhere. I totally reject your argument.