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Originally Posted by icesar  I completely agree that as a business, the domain name is secondary and it's the service or product that you provide which is of value.
But I'm asking about domains as an investment vehicle, something that you can buy and get a yearly return on, much like a bond or a rental property.
I know that this is possible because of type-in traffic, and I'm wondering if anyone has had any experience with it. |
I agree with the previous poster....its not really something that adds a lot of value to society. I also don't see it as something you could be really passionate about.....
I think what you're thinking of is what is known as "domain parking". Basically, you buy domain names and when people go there they get a list of sponsored links. What some people have done is buy what are essentially "typos" of well known domains hoping to get traffic from people who type in the names incorrectly. Here's an example of what I'm talking about
:
TARGETS.COM: The Experts in Targets
They're likely hoping to get traffic from those who are looking for the department store, as well as those who are looking for targets to shoot at. They've got a simple web page with nothing but sponsored links.
Now there's nothing inherently "wrong" or "evil" about it I guess--I own a bunch of domain names that I'm not actively using right now and the domain registration company sets up "parking" pages on these with sponsored links and makes some money off of them. I could easily set them up with a third party who'd serve a similar "parking" page and give me a cut. I just haven't really considered it to be worth my time and effort. I'd rather wait until I can develop them into something useful...
Furthermore, if you're hoping to get traffic based on the "typo" sites it may be a situation where technology is quickly going to put the kibosh on that. I use a service called "OpenDNS" which self corrects typos--so if I type in "Gogole.com" it corrects it and sends it to Google. If there *is* someone with a parked page on "Gogole.com" I never see it. It would be very easy for ISP's to implement this sort of thing on their DNS servers, and there goes your "typo" market.
If you can come across some good domain names, you can always try to resell them on the secondary market for a profit (and set them up with "parked" search results pages in the process). At this point, however, its gone from passive income generation to an actual job...
A problem with that, however, is that ICANN (the organization that administers domain names) has a process by which a business can "claim" a right to a domain name. Say you got wind that Apple was going to make a broom and call it iBroom. In advance of that you went out and registered "iBroom.com". Apple might try to cut you a deal for the domain name, but they could also claim a proprietary right to the name and dispute your ownership of it. In situations like this companies will frequently just try to work out a deal with you, but they have a recourse if you try to get too much money out of them.
Bottom line--there may be a way to make money with domain names but its more likely a full time job rather than some sort of investment or passive income generation technique.