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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.
At my company, we have a couple of hundred domain names that we don't currently use. We're not cyber-squatting, we are going to use them at some point in the future - but development time is always in short supply.
In any event, without even trying to sell them, we occasionally have people offer us money for a domain that we have. Sometimes it's a few hundred bucks, sometimes it's more. Just this week we agreed to sell one for $6500. If we were to make a full-time business out of it, I'm sure we could make a good bit of money.
Oh, you're not stuck, you're just unable to let go of the onion rings.
I'm sure I'm not the only one who remembers back when Google results were essentially free of this type of nonsense. Even a very broad search would generally return useful results. For instance, searching for "toy firetruck" would return links to toy stores and antique toy dealers on the first few pages. Quality search results were the driving factor in switching from some other search engine to Google.
These days, however, results from a broad search usually return five or six pages of aggregators, domain parkers, and other foolishness. It's gotten to the point where I feel like if I don't have four or five search terms, it's not worth the effort of paging through the first six screens of useless results to get sort out the wheat from the chaf.
For the moment, with most web advertising operating on a pay-per-view or pay-per-click basis, people creating aggregators and parking domains are making money. I'm hopeful that as advertisers become more interested in tying views or clicks to actual sales, the incentive for putting this kind of useless fluff on the net will decrease. Of course, we'll still have not-so-net-savvy surfers who might click links on a parked page and then buy something. But if the intermediate pages led to useful information, they wouldn't be so annoying, would they?
Eventually, my bet is that there won't be enough profit in advertising to make domain parking worthwhile. May that day come soon.
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Working on harder on search engines (which is seemingly hard enough, just look at the investment made by google and the talent they're hiring to get this done -- which nobody else can afford to do) seems like a workaround. I think we need something else.
Internet is nice and all, but it has its share of problems. Domain parking is a problem somewhat like spam. Nobody wants it, and we need a system that makes it impractical. That's the real fix we need. Although I don't see what we'd replace the current system s(both domain names or email) with.
Out of those 300000 names, I'm sure there's quite a few that could be useful to many "legit/real" sites (even though a good part are likely misspellings of well known sites). But those assholes are grabbing every name that might be somewhat interesting and that's still available. Been playing with nameboy to find a few good names for a while, and quite frankly, out of a thousand I'd like to get, I'm lucky if 5 or so are available (and they're not the best ones either, more like second picks).
Buying a domain name is much like trying to sign up for a free email account nowadays. You try anything, and it's already taken. You even try totally random things and half the time they're already taken!
I don't think it's the search engines that cause the visits so much; rarely, if ever, do I click a link from search results and get a parked domain. If I do, it's usually because the search engine has it indexed before, and the site has since been taken down and the domain bought by someone else.
The way that domain parkers make their money is mainly through mistakes. For instance, if I buy reallykickasssite.com for a future project, a domain parker is going to come in and register reallykickasssite.net, reallykickasssite.org, and reallykickasssite.info in the hopes that my site will become popular and someone will accidentally type in the wrong TLD. Then there are ones that are mispellings, like foogle.com or yahooo.net or something.
Hell, sometimes they don't even wait for you to register it. I've gone to do domain checks at GoDaddy for a domain I might want to use, decide to mull it over, and come back the next week to buy it only to find that some company got it and parked an ad site there. I have no idea how they know that I checked on it, but they somehow get it on a list and snap it up.
What's worse, though, is that they hold on to these forever, so you can't just wait for their registration to expire. A domain is fairly cheap, so it's not a huge drain on them. And I know of no way to purchase it from them, either. If you have some sort of trademark or copyright, you could probably wrestle it from them through lawyers, but beyond that you're likely SOL.
I've learned my lesson, though. If I ever get an idea for a domain, and check to see if it's open, I'm going to buy that domain if it is. It's only $8-$10, and if I decide I don't want it I just turn off auto-renew.
GoDaddy has this thing where you pay $20, and when the domain becomes available they'll buy it for you and put it under your name. Has anyone tried this service and had it work? I have a sneaking suspicion that they are the ones doing the parking themselves (that's where I do most of my domain checks), and just trying to get another $10 out of you for the domain.
Assuming that:
a) parked domains with advertisements/portals are detectable
b) list of these sites could be easily kept up to date
c) something that I haven't though of could be used to quickly determine if a domain was parked
Then it would be a trivial plugin to rewrite common typos, and avoid these sites entirely. We can push the advertising somewhere else!
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It's not really squatting, though, is it? In real estate, squatting means living on property that you don't own, without the owner's knowledge/consent, because the property is effectively abandoned and neglected.
This is more like real estate speculation. Buying a parcel of land, and then sitting on it to assert ownership rights, while not developing it and waiting along for someone who wants to buy it from you so that they can use it. Speculating is a lot less unsavory-sounding than squatting.
You see? You see? Your stupid minds! Stupid! Stupid!
I think it's because Firefox's developers don't think there's anything inherently wrong with ads.
This is besides the point; it's not about the inherent "rightness" or "wrongness" of ads, it's about whether people want them as part of their browsing experience or not, and whether the technology can deliver that. I think it's safe to say that, given the choice, most people would choose no ads over ads, therefore it would make sense that a browser give them that.
If a whole lot of people wanted white-on-black text, browsers would probably implement that, too. It's not an issue of whether white-on-black is inherently superior to black-on-white, it's just consumer demand.
The Firefox developers are choosing to pass up what could be a big boost to its popularity, because they don't want to give people something that I suspect most people want, or would find useful. I suspect it's because the Firefox project and the Firefox developers themselves draw revenue from advertising, and don't want to cut it off (or come under fire from people who's revenues might be impacted). To put it bluntly, it's a conflict of interest -- I'm not judging them for that, because it may be a necessary consequence of staying afloat as an organization -- but they have goals other than producing "the best browser" possible, which prevent them from putting in such a feature.
It's the same reason that TiVOs don't have automatic commercial skipping, even though such a thing would be possible to implement (and other projecs like MythTV do), and most people would probably think it was the greatest thing since sliced bread. There are other considerations on the part of the manufacturer, which trump what would be best for the consumer.
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Mozilla makes money from google being their default search engine. Google makes money from ads. I doubt they want to actually include adblocker with it turned on. They have the extension, that is as far as they probably want to go.
Actually, that's wrong. Earlier last year I launched a new website and a corresponding AdWords campaign to spread the word. When searching the name of my product, I get hundreds of hits from parked domains that are running AdSense containing my ad on it. Now, the first five pages of results are legitimate websites, and the remaining 10-15 are parked domains. It is incredible how many empty domains get drawn into these search results.
Furthermore, most people search for websites rather than type them in the location bar because they usually don't know exactly what they're looking for. If parked domains only made their earnings from direct hits, I suspect it would not be nearly as profitable.
For he today that sheds his blood with me shall be my brother.
I for one welcome our new domain squatting masters.
No, really, I do. The consolidation of the domain squatting market makes it possible to do interesting stuff like NEVER go to their sites - eg a firefox plugin to check who's behind 'direct navigation' site names and, if its a squatter, take me to google instead. (I love how they say direct navigation like its something that users just started doing, that they might patent)
What he fails to see, of course, is that the profitability of domain parking was never in the "quality" of the appearence of the parked domain, but it was gotten by virtue of being the first people to snap up the most domains.
As mentioned in the article, most "domain parking companies" aren't grown, they're bought from companies that own domains already and then slowly added to by using automated tools to snatch up new good domains.
How is this article
I'm not entirely familiar with this, but is there any per-site registration cost to them? If there is, someone should run a bot searching for random garbage string domains. At least it would take them work to sift through the crap, and I'm pretty sure that's incompatible with their business strategy.
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This could get worse as the exploiters get smarter. They are automatically generating realistic web sites based on word associations, which will fool search engines and the public, much like spam content is picking up context.
I had friends who had a non profit web site and they missed a renewal, the domain was immediately grabbed by porn spammers and they even used the site's original graphics. The generated site was probably entirely automated.
With the money spammers are making, you have to wonder what they are doing behind the scenes to shore up their position. They are completely amoral as long as the money keeps rolling in.
The web could become as useless as email. Soon we'll need a turing test for each letter typed.
Me: OK, go to www.dimspace.com
Them: OK, I'll search for that. I'm on Yahoo.
Me: No, just type it into the location bar.
Them: What? I'll search for it here. OK, which one is it? Should I click on the top link.
Me: (resigned) Yeah, I guess... (mumble something underneath my breath about how cousins should not be allowed to marry)
People get stuck in their ways. Heck, some people can't even accept that there are sites that don't begin with "www". Tell them to go to "mail.yahoo.com" and they'll go to "www.yahoo.com" and stare blankly at that over-crowded page searching for the "mail" link. As Ross Perot used to say, it's just sad.
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ICANN is subsidizing this garbage industry to the tune of about $300,000,000 to $500,000,000 per year - yes every year - out of our pockets.
This is because the "domainers" get free domain name registration tryouts while the rest of us are forced to pay a ICANN-fiat "registry fee" of about $7 per name per year.
The ratio of our full-time registrations to these freeebies is about 1:200. In other words, each of our paid domains is paying the costs for 200 of these "domainers".
ICANN allows this, but it never really was presented to the board of directors for approval (I know, I was on the board at the time). ICANN should stop it and make the registry-fee match the actual costs that Verisign and PIR and others incurr to handle the back-room registry function - a fee that, rather than ICANN's $7 probably ought to be about $0.02 per year - a savings for you and me of more than $300,000,000 per year, every year.
But soon Google and Yahoo, who provide most of the ads on parked sites, found that click-throughs from parked pages often didn't lead to sales, and many advertisers didn't want to buy AdWords and then have them show up on these sites with no content. Some of the largest parking services began switching to a pay-per-action business model, instead of pay-per-click.
Meanwhile, venture capital firms started pumping money into the sector, buying up registrars (like Demand Media's deals for eNom and BulkRegister) and large domain portfolios. Vector Capital bought Register.com, and Perot has a piece of Internet REIT. The VCs and Wall Street investors prefer to monetize their domains with developed web sites instead of parked pages. Many of them are using free user generated content to populate these sites with articles and forums linked to their target keywords. Google likes these sites better, and they appear to get more relevant traffic and click-throughs.
But there will always be plenty of smaller operators with thousands of single-page ad-filled parked domains. The low price of domains means there's virtually no barrier for entry into this business, and that's not likely to change anytime soon.
RichM
Data Center Knowledge
There has to be a way to neutralize these sites as the Internet is getting more useless every day. Legitimate people who try to register a site find their name is taken by someone just sitting on it and demanding $50,000 for the name. Here's a dangerous idea: cancel the domain registrations. Make a few simple rules, like any entity found to have more than 10 mobius loop sites like this will have all their registrations released and name servers de-listed (which would kill the ISP). We could get the Internet back in one afternoon. The dangerous part is that someone will need to decide what qualifies and what doesn't.
Most of the stuff on
Real estate speculation employs capital, albeit in small amounts. Every speculator buys from a seller, and the seller receives capital that can be invested elsewhere. The speculator is assuming risk and providing liquidity (which can be a big issue for real estate owners). Speculators in other areas are essentially providing the same function, despite our distaste for them.
Domain squatters are not in the same league. They do not add much liquidity to the market, because their investment is so low that it is virtually negligible. There are vast number of typos associated with "valid" domain names, so whereas scarcity makes specific plots of real estate valuable, it does not restrict domain squatting in the same fashion. It's as if each valid domain, upon being established and putting up its "sign" on a search engine results page, is immediately surrounded by billboards that claim to be the true domain.
In the real world, laws exist to restrict the allowable types and locations of signage. This is intended to reduce the visual clutter that would, if left unchecked, make life miserable.
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That's when the lightning bolt hit me: You'd have a company that generates its own traffic, generates its own content, and monetizes itself. It would be the perfect lazy-man's media company!"
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So he sees social networking not as a way to give users voices or a place to share ideas, but as a way to monetize them and to get users to generate free content. People aren't going to use a site that treats its users like free content machines and not people, especially not when there are sites like Blogger and Livejournal that give users control over their content and don't post ads. Even the ad-filled Facebook always makes sure to keep users informed, respond to feedback, and keep the ads to a reasonable level. If you don't respect your users, they'll quickly find someplace else to go.
Also, why in the world do we need another social networking site? There have been tons of competitors to MySpace and Facebook, and none of them have really caught on. Remember that this guy didn't develop MySpace; he just found a way to make lots of money by selling it.
The arrogance of this guy's plan to get users to do the work for him while he makes bundles of money is astounding, and I don't think that people will stand for it.
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Please. It's hard enough to enforce the rules we already have. Detecting "loops" amongst the millions of domains that exist would be fiendishly expensive — and the cost of fighting the resulting lawsuits would be even more expensive.
Which reminds me how we got into this stupid mess in the first place. When the web first took off, TLDs cost $50 a year. This outraged a lot of technohippies with too much time on their hands, so they crusaded for more competition in the registry field. And they got it. So now you can register a domain for a few bucks, and you can get discounts for registering a large number of domains at once. So domain squatters pull out the dictionary and the typo generation software, and grab all the likely domains. So now you can renew your domain for a few bucks a year — but for any really useful domain name, you'll have to spend thousands just to get it.
The smart thing would have been to keep the $50 annual fee or even raised it. (Yeah, Network Solutions didn't deserve that much. So what? If that bugs you, make them pay a cut to charity or something.) If you really need a top level domain, you can afford that much. If your pockets aren't that deep, get a second-level domain from your hosting provider. The one I used in those days gave me one for free.
So now that we've "fixed" the original problem, you want to fix the fix? Let's leave bad enough alone.