For Sale Why you'll get screwed by the WLS

[DropWizard.com]

All this back and forth over the WLS brought some thoughts to mind. Let me tell you about a couple of the drop competitors I know. No names just info.

One spent over 250K on computers specifically for the drops

Another has the entire domain DB downloaded and sorted into key words & expiry dates. He knows every domain when it expires and has it listed well in advance of anything you see in the zone files.

Many of them know which (domain) holding companies are defunct and dropping good names. This means the WLS/Snap will be taken long before it hits the zone files.

Ability to sort for keywords, length, dmoz, yahoo, links, alexa, overture and more is standard. My software as an example sorts for keywords and length and date and builds a nice scrolling html file. Cuts the long lists by around 75% and you can just sit back with your feet up and watch the names scroll by. All custom built BTW.

Let me tell you about an experience I had 18months ago. Going up against one of these guys. New country code opening. .CA's.
I had a list of 107 A+ names. I also thought I had a pretty good chance with my connections etc. Huh! This is also how the WLS will go (assuming it ever does)

This guy put out a list of 1700 names to each registrar and deposits of over 100K. Net result he got 67 of the 107 I got 3. Next best got 20. Overall they took 1100 names!

And he's about 1/10 the size of Ultimate or Buydomains. Ultimate BTW is rumoured to spend over 50k a month at Snap.

And there are more people & or companies like this out there than I could tell you about.

These guys treat domains like a business. They invest money. And they are prepared for risk. All these resources will turn to doing what they do best. Wls or dropping domains it doesnèt matter They will win out.

As for the registrars let me think...Oh yeah Ièll give Charley priority cause heès a nice guy and spend 2k with me every year. I like him better than Ultimate that spends 200k with me. Yep, right!

At least with the current situation you all have a fair fighting chance to improve yourselves.

WlS will give you nothing.

 

[Brujah]

I'll play devils advocate.

If the WLS gives BuyDomains, Ultimate, and other pro's the advantage.. why are they seemingly the loudest voices against WLS ?

 

Ult a "loud voice"? Can you reference urls to support that comment?

The WLS will increase their costs, and rightly BD is voicing their concern over it - but do you think that will be a major barrier to a company so successful?

It might mean they don't bother to WLS the dregs, but thats not what people are upset about - its the better quality names that people think they have a god given right to.

 

[DropWizard.com]

The WLS will increase their costs, and rightly BD is voicing their concern over it - but do you think that will be a major barrier to a company so successful

Exactly. Like any business having a major cost increase with no alternative would make any business squawk. But they will have the bucks to see it through if they have to.

 

[bigdave]

Originally posted by safesys
The WLS will increase their costs, and rightly BD is voicing their concern over it - but do you think that will be a major barrier to a company so successful?

It might mean they don't bother to WLS the dregs, but thats not what people are upset about - its the better quality names that people think they have a god given right to.

After the WLS starts up the table scraps will still abound, but we'll see who is holding subscriptions on the good names. Somehow that will be "fairer" than the current process. :laugh:

Of course if anybody is really concerned about being "fair", the "fair" thing to do on an expiring name is to contact the owner and try to buy it from him/her before it drops. (Aaaaaagh, my tongue really got stuck in my cheeck that time. May take surgery to get it back out!)

Again, everybody should understand that the WLS is designed to solve VeriSnap's revenue problems. VeriSnap sees big bucks being made under the current system, and wants a piece of that pie. It's that simple.

BD

 

[Brujah]

I've been working hard on the launch of my new system called ONS ( owner notification service ), that automatically watches for WLS's and notifies the existing domain owner that VeriSnap wants to sell his name for only $49 as he lets it expire and he should accept $49 from me for it instead!

I'll be accepting Venture Capital so I can throw big parties and buy a new, bigger SeaRay.

 

[bigdave]

Originally posted by Brujah
I've been working hard on the launch of my new system called ONS ( owner notification service ), that automatically watches for WLS's and notifies the existing domain owner that VeriSnap wants to sell his name for only $49 as he lets it expire and he should accept $49 from me for it instead!

I'll be accepting Venture Capital so I can throw big parties and buy a new, bigger SeaRay.

Sounds "fair" to me!!

BD

 

[morel]

BuyDomains is not as sophisticated as you might think.

Example:

They own the domain name gourmetmeals.net. Not a bad name.

YET,
the domain name gourmetmeals.COM was left unregistered for at least two months. Two months to pick up a better name, and they passed up the opportunity. And "gourmetmeals", though not a great name, is certainly worth registering, especially if you have the .net.

The point is this:
it is ridiculous to think that with software and fast computers that BD and others will somehow spot all the best domains, and leave nothing for everyone else. With their costs increasing dramatically, they will only be certain to get the best names.


250k spent on computers ..... 100k spent a fast internet connection... 300k spent on getting a special deal with the registrars.... 10k on getting the database...

ALL that is all CHUMP CHANGE to what they will have to be spending with the WLS. At $40/year, monitoring 100,000 domains means that they will have to shell out an ADDITIONAL $4 million dollars, per year. And with the domain name market that's not doing that great from a seller's perspective (not too many mega sales going on), some of these speculators are going to be put out business. Simply put... many speculators, seeing how expensive it will be to maintain the same levels, will find something else to spend their time with.

 

The wls will allow them to secure the better quality domains well in advance - that will actually improve their acquisition quality and thus return on investment.

We'll see the same whinging and moaning once the wls is implemented as we do now as the real route of the problem is people wanting something for nothing - and that will never change regardless of what is implemented.

 

[morel]

Originally posted by safesys
The wls will allow them to secure the better quality domains well in advance - that will actually improve their acquisition quality and thus return on investment.

We'll see the same whinging and moaning once the wls is implemented as we do now as the real route of the problem is people wanting something for nothing - and that will never change regardless of what is implemented.

That's not true at all. Think of it this way:

Consider domain asdfasdf.com. Let us assume that it is worth $1000. Let's say that BD wants it.

* Before the WLS, let's say it would cost them about $1 in bandwidth (in reality less) to get a 50% chance (in reality higher) of getting it.

* With the WLS, it will cost them about $40 to get a 100% chance of getting the name. No bandwidth fees, but a much higher fee to VRSN.

(Note that I am excluding the reg fee, which is the same in both cases)

* Thus before the WLS, BD will have to spend about $2 to get a domain that might sell for $1000.

* AFTER the WLS, BD will have to spend about $40 to get a domain name that might sell for $1000.

Including reg fee does not alter the crux of this calculation.

After the WLS, BD will have a much smaller ROI.

 

Currently, bd plays a game of volume and spread.

Currently, they are registering large volumes to get gems from dirt (apart from the obvious good ones).

The wls will grant a window whereby they can secure a better ratio of good ones (more likely to yield profit) to dirt (wildly speculative).

As such, they can get a better share of the good names (by looking further forward than can be achieved by lower rent players), at the expense of dirt sifting.

Thats where better roi comes into play.

[ to illustrate:

if they currently pay $7 a reg, that means a wls at $40 will cost 6 times more (ignoring bandwidth/registrar deals etc). If the average domain has a 10 fold increase in probability of selling and/or value then its an improved roi.

]

 

[morel]

Originally posted by safesys
If the average domain has a 10 fold increase in probability of selling and/or value then its an improved roi.

I really think that it is ridiculous to argue that BD will be MORE profitable under the WLS.

With respect to improved roi, I just don't see it. Before WLS, BD is spending $7 for every SUCCESSFUL registration. After WLS, BD is spending $40 not only for the successful registrations, but the UNSUCESSFUL registrations as well. And given their selectivity, the vast majority of the domains will not drop. So, despite getting better names, their costs will increase more than the value of the domains.

To be honest, I don't know BD's business plan, and I'm not going to continue throwing numbers around. After all you can be losing money (billions of dollars in the case of WorldCom), and if you're good with numbers, still post a profit.

But I still think it is evident that BD will be less profitable under the WLS. Why?

Every company, big or small, in every industry, from the giant tobacco industry and the airline industry, to the lowly expired domain industry, is looking out for its own interest, its own bottom line.

Whenever a piece of legislation if proposed, every company makes an opinion. They make their opinion on how it will impact their bottom line.

It doesn't take an MBA to figure out that BD's vehement opposition to the WLS means that it will be making less money under it.

 

[Cartoonz]

The question you all should be asking yourselves is NOT "How much money will BD make?" but how YOU will make more money under WLS.

...and the answer is "You won't". If you suck at getting names now, you will suck even harder under WLS. If you know how to bag names now, you may get lucky with WLS because you will be prepared.

With today's system, you can improve.
With WLS it is "Game Over" after the first opening.

It always amazes me how many people that don't truly understand how to beat the current system seem convinced that they will beat the new one.

 

[Domain]

Can anyone remember Verisign's justification for trying to implement the WLS in the first place?

What's to keep Verisign from contacting an existing domain name owner and "informing" them that a WLS slot has been reserved on the name they currently hold. Assume you are considering the non-renewal of a mediocre name in your portfolio. Verisign conveniently notifies you near the expiration date that someone is waiting for your name to drop. What will you do? Chances are you will pay to renew the name because you have rethought the value of it. Verisign will get their renewal fee of $6.00 (more if you registered it directly through them).

What is their goal? Perhaps it is to stop the deluge of domain name drops that are occurring in order to protect a dwindling source of reoccurring income.

 

Originally posted by dmorel
It doesn't take an MBA to figure out that BD's vehement opposition to the WLS means that it will be making less money under it.

I understand your argument, although there are exceptions (Verisign is despised to the core by many in the domain industry).

My previous example calculation was geared to show that the WLS does not necessarily sound the death knell for the big players just because the raw cost increases.

Both of us are speculating with regard to how the WLS will impact, but past history has shown the big players like bd and ult are one step ahead of the masses and many steps ahead of the people who spend more time bemoaning bd's revenue than attempting to create their own.

 

[mole]

Originally posted by Domain
Can anyone remember Verisign's justification for trying to implement the WLS in the first place?

What's to keep Verisign from contacting an existing domain name owner and "informing" them that a WLS slot has been reserved on the name they currently hold. Assume you are considering the non-renewal of a mediocre name in your portfolio. Verisign conveniently notifies you near the expiration date that someone is waiting for your name to drop. What will you do? Chances are you will pay to renew the name because you have rethought the value of it. Verisign will get their renewal fee of $6.00 (more if you registered it directly through them).

What is their goal? Perhaps it is to stop the deluge of domain name drops that are occurring in order to protect a dwindling source of reoccurring income.

Yes. it is a revenue thing for Verisign. They are stuck with a limping jackass of a revenue generator and are in dire need to stop the hemorrage.

But I'm sure I read somewhere that WLS applies only when a domain has actually expired.

 

[bidawinner]

Brujah..

hey you cant do that..that takes ALL the big boys out of the equation ! LOL


Dont sweat the small stuff..99% of us small fry will never get a mortgage.com anyways..you are on the correct path ..why stand in the back when you can go to the head of the line

BID

 

[Domain]

Originally posted by mole


But I'm sure I read somewhere that WLS applies only when a domain has actually expired.

Please post it if you ever find evidence of that.

I thought WLS is to be based on SnapNames technology similar to the way it now exists. Currently you can buy a SnapBack on any name at snapnames.com.

 

Originally posted by Domain
Please post it if you ever find evidence of that.

Mole, you need to quit spouting this junk if you want to be credible on the WLS.

It's being hailed as, among other things, and "insurance policy" for existing domain holders so that they don't accidently lose their domain.

Here's Verisign saying you should take a WLS subscription out on your own domain - just in case - you forget to renew it...

By the way, with no forced drop policy, valuable names will not simply expire. No registrar in his right mind will allow a valuable domain with a WLS subscription on it to even enter the dropped domain market. This is the one missing piece to the Verisign monopoly actually making names available to WLS holders.

I can tell you right now, we'll be offering as a no-cost service if possible, notification of any WLS subscription on any domain registered with us, with an option for auto-renewal so that your name never drops.

-t