If the only entity losing out is Namejet (since they aren't fully offering public domain sales yet), why does anyone else worry about this? Wouldn't it be a good thing for the second highest bidder to get the name at the price he bid?
This does impact every one who is bidding.
It is not as cut and dry as just NameJet losing out here.
A fallback to the second bidder could potentially cost that second place person thousands of dollars in bogus bids =
bogus bucks.
If the winning bidder has entered 8 different bids on one auction and then backs out, all of his/her bids needs to be totally backed out of the equation.
I win an auction for $10,000 and you were second for $9,900.
I started bidding at the $5000 mark.
When we hit $8000, from that point on it was you and me, mano a mano, slugging it out.
I am a plant, a shill bidder, or just a bogus entity.
I don't pay, never intended to pay, and I was nothing more than someone running up the bids.
You are notified that you won for $9,900.
You are excited to have the coveted name.
But look back at the bidding sequence.
If I am totally bogus, you actually won the name at $8000.
Because at that point, all other bidders were bested by you.
And if my winning bid does not count and is erased then ALL of my bids are erased.
It goes back to the point were it became one-on-one because you outbid all the legitimate bidders up to that point.
Award you the domain at $9900.00 just cost you $1900 above and beyond what you should have paid and made an additional commission based on NameJets structure.
In this case, it is a WIN-WIN for NameJet and a WIN-LOSE for Elliot.
So no, this does not just impact NameJet and yes, domainers should be concerned if this is going on.
If you look at the bidding history of the specific auction and note where that winner was battling it out head-to-head then that is the starting point and the ending point of the auction.
All the other bidders involved are a non-factor as the assumption is you would have beat them.
If other legit bidders were involved from that 5000 point up to 8000, then even if the bogus bidder's bids are erased, you still would have beaten the legit bidders in a head-to-head case.
Is this troublesome for the auctioneer?
No.
It will just take time to handcheck the bids.
This is the fair and equitable way of handling something like this.
No re-auction.
The only time a bid should be awarded to the next highest bidder is if the $10,000 bid was the one and only bid placed by that bogus bidder.
Then yes, you win at $9,900.
In this scenario, I am the victim of a sale of a domain at Sedo.
The winning bidder placed a bid (his/her one and only) with less than 6 hours remaining in a 7 day auction.
In perhaps the fasted anyone at Sedo has ever moved, the winning bidder contacted sedo to inform them a mistake was made and sedo canceled the auction and all the bids.
All of this in less than 24 hours.
No re-auction or anything.
Just a
Dear Seller letter.