Let's discuss Andrew Rosener's idea of owners bidding in auctions

equity78 · Jul 19, 2017

To give the idea it's own thread let's discuss the idea put forth by Andrew Rosener of @MediaOptions that owners would be allowed to bid on their own domain names at auction.

Andrew never stated to do it secretly or against an existing platform's TOS.

I don't see what Andrew sees, let's say I have a 4L.com Rayy.com, there are a bunch of backorders at $69 and the name is at $300 with Andrew in the lead.

I think $300 sucks, so I bid Andrew up, he counters back and this goes on in traditional bidding war style to $1,800. For this hypothetical no one else jumped in so it's just me the owner vs Andrew. I obviously have an advantage, I try to get Andrew to go to $1900 so I bid $1850 he has to go to $1900 to take the lead. He doesn't he says too much for that name I'll pass. I will the auction at NameJet. I pay them $1,850 and they send me back 90% of the $1,850.

I was certainly in an advantageous position compared to Andrew, without me, the owner, he wins at $300. No other person bid, only the person with a vested interest, the owner bid.

I have proposed a few exotic type auction ideas here at Namepros over the years, some have been allowed, some haven't. One I proposed that @Eric Lyon thought was interesting but decided against (I had no problem with that). Was an owner clawback option, where the owner does not participate in the auction but if it closes say at $500, the owner could say I want to callback my name and pay the winning bidder say 10 or 20%.

In that example the market would be fair, everyone bidding upfront would know that the owner had the option to clawback the name. It would be better than a reserve auction because there would be some monetary gain for participating and being top bidder as opposed to bidding all day on GoDaddy, not meeting reserve and the high bidder has nothing to show for their effort.

Just my opinion, what is your opinion?

deez007 · Jul 21, 2017

Wannabean said:
Very cool. I think that's an improvement on my idea. I like the idea of the runner up being compensated in this scenario.

I'm sure some thing can be done to improve the way things are currently being done.... but it all starts with discussion..

Hopefully some of the marketplaces take wind of these suggestions...lol - I bet the first one to implement something like this would enjoy a considerable spike in listings..

Also, just in case some of the marketplaces are listenining..... @Wannabean and I are happy to provide our services on a consultative level ...just 1btc per week. (each)

Lox · Jul 21, 2017

The idea is not in favor of legislative / government regulation, international trade, investment, financial organizations and s.o.

DU · Jul 21, 2017

Wannabean said:
Sometimes the owner wishes they could buy their own domain back for a price higher than it actually sold for in a no reserve auction. This is the scenario Andrew is talking about. The idea is not to push other buyers up but to have the option to buy your own name at the cost of commission rather than lose it for much less than you value it.

And in the perfect free market that he talks about (not the one one-side market he actually wants but puts in free-market fancy dress) he could do that. It's called paying the new asking price for the domain set by the new owner.

No one mentions the tax implications either, of course, because if you treat them as goods bought and sold this even is a realization of your gain/loss early. You could, of course, if you try to register losses in enough volume, be construed as a tax cheat. It's essentially "washing".

{Depending on jurisdiction, accounting method, tax-cheatiness etc.etc.}

DU · Jul 21, 2017

JB Lions said:
It's just not something that would ever work in domaining (most places), there is no market for it. Even if everybody knew the owner was bidding. I've never heard anybody say, I really which the owner of the domain could bid against me. The only reason why the owner would be doing that is price manipulation. Bidding to get the numbers up. And there is no risk again if they won, because they would get the money back minus the fees. So it's not something that would ever happen.

It does and it's called a "reserve" auction. The difference is that the name doesn't "sell" the owner reserves the right to not sell.
I don't understand the manipulative and sleazy method being proposed... oh wait, yes I do....

Wannabean · Jul 21, 2017

DU said:
And in the perfect free market that he talks about (not the one one-side market he actually wants but puts in free-market fancy dress) he could do that. It's called paying the new asking price for the domain set by the new owner.

No one mentions the tax implications either, of course, because if you treat them as goods bought and sold this even is a realization of your gain/loss early. You could, of course, if you try to register losses in enough volume, be construed as a tax cheat. It's essentially "washing".

I'm not entirely sure what your getting at. But....(be forewarned we're in theoretical land again!) The losses incurred by the owner would be the commission paid, which is a real loss, so no use trying to cheat the tax man cause you can't save tax on money you don't have.

And it's no more one sided than a reserve auction. I concede it might be frustrating for buyers in a scenario where the seller is stubborn/optimistic but again that is true of reserve auctions.

Wannabean · Jul 21, 2017

DU said:
It does and it's called a "reserve" auction. The difference is that the name doesn't "sell" the owner reserves the right to not sell.

Your reserve point has already been made. Please read the entire thread before posting.

DU said:
I don't understand the manipulative and sleazy method being proposed... oh wait, yes I do....

Again, because you didn't read the entire thread.

DU · Jul 21, 2017

Wannabean said:
Your reserve point has already been made. Please read the entire thread before posting.

I was responding specifically to JBL in a context specifically for JBL.

Wannabean said:
Again, because you didn't read the entire thread.

I'm not sure you even read my one post. You certainly don't understand it.

Wannabean · Jul 21, 2017

DU said:
I'm not sure you even read my one post.

Sorry DU I was only trying to highlight that the points you raised had been addressed previously.

DU said:
And in the perfect free market that he talks about (not the one one-side market he actually wants but puts in free-market fancy dress) he could do that. It's called paying the new asking price for the domain set by the new owner.

It can't be one sided if your on both sides of it and media options both buys and sells, as we all do.

slimjim270 · Jul 22, 2017

Shill bidding is "theft by deception".

The goal of an "auction" is to "transfer an asset". If you "win" your own auction, you are not transferring an asset. The only goal of owner self-bidding is to manipulate the bidding higher, not to support an "auction for transfer".

Andrew can sugar coat a turd all he wants... it doesn't make it a Babe Ruth bar!

-Jim

slimjim270 · Jul 22, 2017

The goal of an auction is not to bid for pleasure, it is to transfer an asset.

An auction without a transfer is not an auction, it is a haggle.

Maybe what is needed for domaining is "Haggle Mart", sort of like a Baghdad vendor's market where individuals haggle for live chickens and goats.

The whole notion of a Free-Market is great in theory (academics and such) but all theory goes sideways when real money is involved.

-Jim

.X. · Jul 22, 2017

Sellers remorse is no excuse for a seller to bid on their own name in an auction, NO, there should not be a buy back option IMO, for the seller, Once a person decides to auction a name, They need to let the public bidders decide what that name is worth, I myself, have been on both ends, at the end of auctioning off my names, Disappointed in the final price i had to let the name go for, as well as very surprised at how much more a name went for than i had anticipated it would go for. You except the out come of an auction, period. That is what an auction is about, How much the consumers that are bidding, are willing to pay for an item, at the end, there you have what your name is worth. There is no in between in an auction, IMO, You decide to start an auction, you let the bidders decide and except the results. Auctions have always been this way, and should remain this way, IMO

Shill bidding or having someone else bid on your behalf to hyper inflate the final out come of an auction, Is the same as Theft, Fraud, It is a form of scamming, That is my opinion on the matter.

offthehandle · Jul 22, 2017

spankdemon said:
None of the bids by the seller are "honest"!

Everyone else is bidding exactly what they are going to have to pay, and the seller is only really bidding a fraction of that, so NONE of his bids are legitimate.

If the seller thinks he made a mistake and overpaid for the name in the first place (or the market has gone down since he bought it), any bid he places is a shill bid, because he knows that if he wins, he is only adding to his initial cost. So if he does bid, he's just taking a risk so that he can try to push other people up to where he can recoup most of his money or maybe even make a profit. If he's bad at it, he will lose more money.
Shill bidding is simply when you make it seem like the item is worth more with phony bids.
It doesn't matter if you're "transparent" about it or not.
If you really believe you already have too much money in the domain, you won't bid, because you know you'll just lose more money if you win.
..Unless you're scum and don't mind shilling to pump it up as high as you can risk.

If the seller thinks he got a good deal when he acquired the domain, then when he puts it in auction, his bids are also just pushing other people up until some high number where he starts to risk losing too much money because of the commission.
If he pays 10k to an oblivious owner for a good LLL.com and puts it in auction, then even if he bids 30k on the name, he will only have to pay NameJet 4500! ..for a total cost of 14500......Meanwhile, other people may have been legitimately bidding 25k+ in hopes of winning it....
That's fair, right?

Some of you seem to think this is such an interesting, revolutionary idea, and we should all be grateful to have it brought before us.
Oh no, the world just wouldn't be as good if we didn't tolerate anyone pushing their unethical, bullsh*t, and very dumb propositions just because they are well-known or well-spoken. How would we ever progress!

Great post. These wholesale markets are churning operations. This is the greater fool theory in action. "Making an otherwise illiquid market liquid" is the phrase used to promote the idea. Scam!!

oberheimer · Jul 22, 2017

Well I think that if you list it in an auction you have to sell. An auction is an auction and why are domain names any different?
You take a risk when you sell names at an auction and I have done the same. I have sold names in the 5 figure range (live auction).
I don't want to be a part of auctions where the seller can change his mind.

offthehandle · Jul 22, 2017

Furthermore, domain names are not commodities. These are more like penny stocks in their risk. You cannot treat them as an asset of physical precious metals or pork bellies or copper. Even those markets get hugely manipulated like with the Hunt Bros.

https://en.m.wikipedia.org/wiki/Silver_Thursday

oberheimer · Jul 22, 2017

offthehandle said:
Furthermore, domain names are not commodities. These are more like penny stocks in their risk. You cannot treat them as an asset of physical precious metals or pork bellies or copper. Even those markets get hugely manipulated like with the Hunt Bros.

https://en.m.wikipedia.org/wiki/Silver_Thursday

Well my names are not like penny stocks. Some have a high value and should be treated as such.
Penny stocks are very risky and domain names are not.
They are like real estate.

offthehandle · Jul 22, 2017

oberheimer said:
Well I think that if you list it in an auction you have to sell. An auction is an auction and why are domain names any different?
You take a risk when you sell names at an auction and I have done the same. I have sold names in the 5 figure range (live auction).
I don't want to be a part of auctions where the seller can change his mind.

And unfortunately "sellers remorse" is allowed in Dynadot, GoDaddy and Namesilo marketplaces. All are NOT auctions. All are non compliant in English nonreserve auction rules of all sales are final . The hammer raises and it must sell and when it falls, there is a new owner. Except in fake domain auctions the prior owner gets a free appraisal, just like what is being discussed here. Testing the market.

.X. · Jul 22, 2017

If that is the case, It is very unfortunate indeed, These types of practices are a gateway for scammers.

slimjim270 · Jul 22, 2017

And how great does it feel, when you "win" a GoDaddy Expired auction (and pay for the transaction) only to receive a "Auction was cancelled" notice a couple days afterwards?

It SUCKS!!!

A total waste of my time.

Which is why I have lost interest in bidding GoDaddy Expired & Closeout auctions.

The concept of sellers bidding on their own domains will frustrate many solid/credible buyers and will turn auctioning into a whores market for tramps.

-Jim

anantj · Jul 22, 2017

slimjim270 said:
And how great does it feel, when you "win" a GoDaddy Expired auction (and pay for the transaction) only to receive a "Auction was cancelled" notice a couple days afterwards?

It SUCKS!!!

A total waste of my time.

Which is why I have lost interest in bidding GoDaddy Expired & Closeout auctions.

The concept of sellers bidding on their own domains will frustrate many solid/credible buyers and will turn auctioning into a whores market for tramps.

-Jim

Not the same as seller bidding on their domain. Completely unrelated concepts

xynames · Jul 22, 2017

http://www.namejet.com/Pages/press-releases/default.aspx

Among the domain marketplaces, at least now NameJet has clarified that

1. We have made modifications to our user account system to prohibit the ability of a seller to bid on a name they have listed.

4. We will be updating our Terms of Service with additional rules regarding shill bidding, to clearly express what activity is prohibited and the penalties involved with violation of such terms.

This way anyone like Rosener / mediaoptions and his supporter xn--v4h.com have been notified to not do what they propose "in theory" would be good.

I think it is important to clarify what is and is not shill bidding,
https://www.namepros.com/threads/bidding-on-your-own-names-at-namejet.1030874/page-32#post-6268320
because we still have people like Rosener / mediaoptions who think that "A SHILL BID is a bid where the person is hiding, using an alias or a proxy. " Best to put a chill on this sort of inaccurate thinking.

As well:

5. We are suspending the ‘Next Bid Wins’ practice. For those unaware, sellers may set their own reserves and may lower their reserve during a live auction provided the new reserve is not at or below the current high bid. Sellers may often lower the reserve to allow the next incremental bid to meet the reserve. We recognize this has created an unintended perception of suspicious activity, and therefore, we will suspend this practice until further notice.

Flippa should enact this policy too. I was bidding at $5000. (below reserve, but the highest bidder) on a website/business when subsequent comment posts unearthed that the site sold counterfeit VERO items.
I got the entire Flippa auction pulled / shut down through several back and forth emails with Flippa support (Bravo! to Flippa for good, conscientious customer support), but I was concerned during the process that when the seller realized that the gig was up and that people had determined that his website was nothing more than an illegal counterfeit goods reseller, that he would lower the reserve.

offthehandle · Jul 22, 2017

anantj said:
Not the same as seller bidding on their domain. Completely unrelated concepts

Unrelated? Same concept. Nobody bidding knows with anonymous bidders with multiple accounts to know who the sellers are. Brother in law network. Please.

anantj · Jul 22, 2017

offthehandle said:
Unrelated? Same concept. Nobody bidding knows with anonymous bidders with multiple accounts to know who the sellers are. Brother in law network. Please.

Domain owners do not/can not bid on their expired domains in GD auctions. Please understand the mechanics fully.

offthehandle · Jul 22, 2017

anantj said:
Domain owners do not/can not bid on their expired domains in GD auctions. Please understand the mechanics fully.

Don't start here insulting me like that. This is naive thinking you are somehow protected. Read what else I have posted. All on the other thread. Ebay too has chronic issues. Auctions even when you can look your competitors in the eye when bidding can be manipulated. It's a slimey business and you simply need to accept it. Pompus snobby art auctions are no better than a cheap print shop bankruptcy. There always will be corruption and collusion among controlling interests and dealers. The digital world is even worse, as identities are masked.

You are not being realistic, all auctions can be manipulated.

Don't believe me though. Read all about it on Ebay problems that won't go away.

NameOmnia · Jul 22, 2017

vinodnair said:
"Again and for the last time, I am NOT supporting shill bidding. I'm supporting the IDEA of openly allowing owners to participate in auctions which have NO RESERVE. Everyone has a fair and equal shot at buying the asset. Where is the flaw?"

The flaw is that the owner already owns the domain.

The whole point of listing a domain is to sell it right? Why would the owner of a domain bid on his/her own asset if not to drive the price up? It does not matter if it is the owner, his family, friends, business partners; it is shill bidding

There is no possible justification for this kind of behaviour, advocacy, proposal..whatever. There is zero ethic and honesty in any non public medium which artificially inflates the price of an asset without a real pool of interested buyers.

Even in stock market this is considered a felony. It is called insider trading / agiotage.

anantj · Jul 22, 2017

offthehandle said:
Don't start here insulting me like that. This is naive thinking you are somehow protected. Read what else I have posted. All on the other thread. Ebay too has chronic issues. Auctions even when you can look your competitors in the eye when bidding can be manipulated. It's a slimey business and you simply need to accept it. Pompus snobby art auctions are no better than a cheap print shop bankruptcy. There always will be corruption and collusion among controlling interests and dealers. The digital world is even worse, as identities are masked.

You are not being realistic, all auctions can be manipulated.

Don't believe me though. Read all about it on Ebay problems that won't go away.

Please follow the thread to who I was replying to and what I was replying to. I'm not insulting you. I was specifically replying to @slimjim270 who equated GD expired auction to what Andrew Rosener is proposing, i.e. Domain owners being able to bid on their own auctions. I'm not sure what you are reading or what you're connecting to but if you follow my comment thread, you'll see. I was not talking about seller initiated auctions where this is a high chance of manipulation. In expired auction, the domain owner does not really gain a lot directly

Let's discuss Andrew Rosener's idea of owners bidding in auctions

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