HugeDomains.com is Buying 50%+ of Expiring Domains at GoDaddy.com

Arca · Dec 9, 2016

I've been wondering about the competition in auctions for expiring domains over at GoDaddy.com, because somebody is paying hundreds for seemingly every domain that gets a few bidders.

I’ve also noticed a clear pattern, with the last bidder (or one of the last bidders) entering the auction winning most of the time, which made me think that there is one large corporate buyer piggybacking of whatever domains other people find and bid on. Turns out that is the case: HugeDomains.com is buying most domains over at GoDaddy.com expired auctions. I looked up the WHOIS of the past 150 auctions I have lost at GoDaddy.com, and 84 of those are now owned by HugeDomains.com and listed for sale on HugeDomains.com.

While 50%+ may not be representative of overall domains bought at GoDaddy, they do seem to buy far more domains than anyone else. The 66 names not bought by HugeDomains.com were bought by a number of different individuals and companies (BuyDomains.com bought 6 of those 66, for example), so 50%+ were taken by HugeDomains, while "the rest" of the auction wins were by a number of different individual domainers and companies.

This might not be news to some, but I've never seen anyone mention that HugeDomains is this active over at GD expired auctions, so I thought it might be interesting for some people to know who is outbidding everyone in the lower range over at GoDaddy. I've read people mentioning that HugeDomains buy names in close-out status over at GoDaddy, but never that they buy most of the domains in auctions too.

HugeDomains absolutely dominates all auctions below $5XX, and they only picked up a single name above $5XX (cakemart.com) in my sample of 150 names, so $5XX seems to be a self-imposed limit for them. If I only checked domains sold below $5XX, the percentage bought by them would be even higher. I've been the second highest bidder in lots of auctions that HugeDomains.com won, and in my experience they will keep bidding until you give up or until the price passes $5XX. By outbidding most bidders in the lower end, and acquiring more than half of the domains other people also have interest, it leaves a far smaller pool of names for the rest of the domainers to compete for, so I guess that's part of the reason why the reseller prices for names keep increasing so much for names in this range.

The only way to buy cheap domains at GoDaddy auctions now seems to be to let domains expire with 0 bids, so that they go to close-out status, and then try to snipe them as soon as that happens. However, some domainers seem to think it's smart to bid $12 on any decent name when there is 1-15 minutes left, hoping that nobody else is going to place a bid, so fewer and fewer decent names are let to expire with 0 bids. However, that strategy never seems to work (I've tried it myself lots of names, and it did not work even one time), because there are always other people watching and waiting for the name to go to close-out, and they jump in and bid if you make a $12 bid, and most of those names are eventually won by HugeDomains.com. What experiences do other people have at GD recently? Anyone else have any good strategies for buying expiring domains @ GoDaddy.com these days?

Some examples of expired domains bought at GoDaddy.com auctions by HugeDomains:
Domain: skillsharing.com
Purchase price (at GoDaddy): $540
Asking price (at HugeDomains): $2995

Domain: ledmaster.com
Purchase price (at GoDaddy): $537
BIN price (at HugeDomains): $2195

Domain: cyberstrategies.com
Purchase price (at GoDaddy): $262
Asking price (at HugeDomains): $2895

Domain: crablab.com
Purchase price (at GoDaddy): $320
Asking price (at HugeDomains): $1895

Domain: dailyportal.com
Purchase price (at GoDaddy): $560
Asking price (at HugeDomains): $2895

Domain: fivesecondrule.com
Purchase price (at GoDaddy): $42
Asking price (at HugeDomains): $2695

Domain: deltacloud.com
Purchase price (at GoDaddy): $365
BIN price (at HugeDomains): $1795

Domain: itace.com
Purchase price (at GoDaddy): $499
BIN price (at HugeDomains): $2595

Domain: sunnykitchen.com
Purchase price (at GoDaddy): $200
BIN price (at HugeDomains): $2595

Domain: baristaschool.com
Purchase price (at GoDaddy): $449
BIN price (at HugeDomains): $2895

Domain: cakemart.com
Purchase price (at GoDaddy): $695
BIN price (at HugeDomains): $3495

Domain: visuala.com
Purchase price (at GoDaddy): $315
BIN price (at HugeDomains): $2795

Domain: massanalytics.com
Purchase price (at GoDaddy): $130
BIN price (at HugeDomains): $2095

Domain: edusport.com
Purchase price (at GoDaddy): $535
BIN price (at HugeDomains): $2995

Domain: acneguru.com
Purchase price (at GoDaddy): $52
Asking price (at HugeDomains): $2495

Domain: stylefolio.com
Purchase price (at GoDaddy): $195
Asking price (at HugeDomains): $1995

Related: HUGE DOMAINS SNIPING GODADDY CLOSEOUTS

Arca · Feb 3, 2018

Kate said:
Ah Verisign... they sure have some ideas to 'level' the playing field.

This looks a bit better, if they indeed start to detect dropcatching and mitigate it as suggested:

Examples of mitigating actions include logging the potential drop-add collusion between the pair of DNS registrars, notifying the registry or a user thereof of the potential drop-add collusion between the pair of DNS registrars, sending a request to the registry to throttle or block current and/or future domain name acquisition requests from one or both of the pair of DNS registrars, and the like.

Now that DropCatch is moving towards a drop monopoly domainers need to pay $59+ for virtually any domain on the drop, and end users need to pay $2000 for the rest that did not get picked up by domainers that go to HugeDomains - Verisign throttling the 1000+ dropcatch registrars from dropcatching would be a welcome shake up to the current status quo.

Asfas1000 · Feb 3, 2018

Why not perform an electronic draw among all interested parties in a domain and skip the drop process completely ?

Instead of dropcatching, I, and everyone else, would file an intent to acquire the domain on Verisign's website.

Kate · Feb 3, 2018

Registrars are already subject to limitations, the number of requests per cycle is capped. In fact, Verisign has tightened access.

Other TLDs also have mitigation steps in place.
For example the French registry has a dedicated EPP server for 'snap' activity, so that normal business is not disturbed by the registrars pounding the registry with requests. In addition there is a classic penalty system which means that if you exceed your quota you get kicked out of the system until the counter is reset.

Nominet (UK) treats multiple registrars belonging to the same owner as one single entity for the purpose of dropcatching. This is to avoid the proliferation of shell registrars pooling resources (what has happened in .com).

Asfas1000 said:
Why not perform an electronic draw among all interested parties in a domain and skip the drop process completely ?

Because this would create a monopoly, that would benefit one player in particular: the registry. The current system is fragmented, even though there has been consolidation. Now the race is between NJ+SN and DC.
But any registrar can take part in the drop and get a little something. They will get the crumbs, but sometimes they will catch a golden crumb. The downside is the lack of predictability, the game is opaque and confusing for people who are not domainers.
Centralization would increase prices, and competition between bidders. Domainers are already paying end user prices too often in the auctions. So it's not a situation that would be beneficial for us (or end users) most of the time.

However, a waiting list service exists in at least one ccTLD: .dk (Denmark). But it works on first come first served basis. If there is already one applicant then you can apply for the second/next position - and hope the first applicant withdraws or change their mind, it is a possibility after many years but uncertain.
And you have to pay a fee every year to maintain your position so it's a gamble.
Moreover the Danish NIC is a not-for-profit organization (like many other ccTLD registries). So it's quite different.

Verisign have always lobbied hard (and sued) to promote their own interests. Which usually are in opposition to yours.

Asfas1000 · Feb 3, 2018

Kate said:
Centralization would increase prices, and competition between bidders.

Why ? I was talking about a draw, not an auction

Asfas1000 · Feb 3, 2018

BTW I don't think Verisign is excited to the fact that one company ones a respectable % of the .COM domains (which is growing too).

Arca · Feb 3, 2018

Kate said:
Registrars are already subject to limitations, the number of requests per cycle is capped. In fact, Verisign has tightened access.

The current limitations were implemented prior that patent being filed.

Kate said:
Centralization would increase prices, and competition between bidders.

Maybe a stupid question, but why would that be? I don't see how undermining DropCatch's near dropcatching monopoly would increase prices and competition?

In fact, when several entities were individually having some success at dropcatching, NJ and SN prior to merging, Pheenix, DynaDot, and Dropcatch, prices were far lower and there was less competition.

Now that seemingly 80-90% of good domains are caught by DropCatch, prices are way up due to caught names being bought up mainly by a relatively small group with very deep pockets. Many from this pool of buyers don't do research/backorder themselves, so they did not increase competition previously when names went to non-DropCatch dropcatchers (i.e. you only bid against them when a name goes to dropcatch). So nearly all names going to DropCatch has significantly increase competition and prices due to the way their system is set up. And everything we don't order for $59 gets picked up by HugeDomains via DropCatch, so getting a pend del name for less than $59 is becoming more and more difficult. How would Verisign throttling and even blocking DropCatch's dropcatching attempts lead to higher prices and increase competition for domainers? Disrupting what is turning into a dropcatch.com monopoly seems like it would move the dropcatching game more towards decentralization where we'd see numerous actors grabbing names again. Names would still become available for registration, only DropCatch wouldn't be able to register nearly all of them anymore.

Kate · Feb 4, 2018

Asfas1000 said:
Why ? I was talking about a draw, not an auction

I'm afraid this will not solve the problem, depending on how it's implemented, people will either attempt to buy more tickets, or lose interest because they have zero chance of winning. Now the approach depends on which exact problem we are trying to solve: ours, Verisign's, Icann's, or other people's.

Arca said:
Maybe a stupid question, but why would that be? I don't see how undermining DropCatch's near dropcatching monopoly would increase prices and competition?

If a WLS is implemented, then this will bring clarity and predictability to a Wild West system: there will be only one place to go, and end users will flock there. Global awareness among people will increase significantly. The Drop will no longer be a mystery.

Please allow me quote this eloquent post:

Jaco said:
Domainers (the ones who actively buy with the express intent to resell) are arbitraging against a perfectly reasonable and understandable knowledge gap that exists between people who do this all day, every day and people who are more concerned with minding the affairs of their keyword-related business and don't have time to keep up with the minutiae of a market that's only tangentially related to what they do. This split in knowledge is where the profit exists between end users and domainers.

That's the deal, we domainers are able to thrive thanks to that knowledge gap. We master a trade that few people know even exists. Putting an end to this situation would hurt us terribly, and most people would rejoice in fact but that's not the point. In a WLS scenario, more end users would be joining in and competing against each other for domains (and paying end user prices). Domainers will have to look elsewhere to buy inventory. The price for convenience will be expensive.

wwwweb · Feb 4, 2018

Arca said:
The current limitations were implemented prior that patent being filed.

Maybe a stupid question, but why would that be? I don't see how undermining DropCatch's near dropcatching monopoly would increase prices and competition?

In fact, when several entities were individually having some success at dropcatching, NJ and SN prior to merging, Pheenix, DynaDot, and Dropcatch, prices were far lower and there was less competition.

Now that seemingly 80-90% of good domains are caught by DropCatch, prices are way up due to caught names being bought up mainly by a relatively small group with very deep pockets. Many from this pool of buyers don't do research/backorder themselves, so they did not increase competition previously when names went to non-DropCatch dropcatchers (i.e. you only bid against them when a name goes to dropcatch). So nearly all names going to DropCatch has significantly increase competition and prices due to the way their system is set up. And everything we don't order for $59 gets picked up by HugeDomains via DropCatch, so getting a pend del name for less than $59 is becoming more and more difficult. How would Verisign throttling and even blocking DropCatch's dropcatching attempts lead to higher prices and increase competition for domainers? Disrupting what is turning into a dropcatch.com monopoly seems like it would move the dropcatching game more towards decentralization where we'd see numerous actors grabbing names again. Names would still become available for registration, only DropCatch wouldn't be able to register nearly all of them anymore.

Pheenix is out, you can ask Arca how they dropcatch these days, straight from owner accounts, it’s so much easier.

If a 3L.com drops either nj or dropcatch have a chance. Money is on dropcatch. A few big Asian based domainers rule it, they just keep out bidding each other. Even a deep pocketed guy like hiphop can barely win an auction there. They don’t get it, they can’t warehouse at those prices, and sell thru, the outlay is too much.

Asfas1000 · Feb 4, 2018

Kate said:
I'm afraid this will not solve the problem, depending on how it's implemented, people will either attempt to buy more tickets, or lose interest because they have zero chance of winning.

If you are after a decent domain for which you would pay, let's say $500, and someone else gets it for $9, you can always offer them $500. If they don't accept $500, they would probably have beaten you in the auction anyway.

I see what you are saying though, and agree that a centralized auction platform would be much worse.

Arca · Feb 4, 2018

Kate said:
I'm afraid this will not solve the problem, depending on how it's implemented, people will either attempt to buy more tickets, or lose interest because they have zero chance of winning. Now the approach depends on which exact problem we are trying to solve: ours, Verisign's, Icann's, or other people's.

If a WLS is implemented, then this will bring clarity and predictability to a Wild West system: there will be only one place to go, and end users will flock there. Global awareness among people will increase significantly. The Drop will no longer be a mystery.

Please allow me quote this eloquent post:

That's the deal, we domainers are able to thrive thanks to that knowledge gap. We master a trade that few people know even exists. Putting an end to this situation would hurt us terribly, and most people would rejoice in fact but that's not the point. In a WLS scenario, more end users would be joining in and competing against each other for domains (and paying end user prices). Domainers will have to look elsewhere to buy inventory. The price for convenience will be expensive.

Verisign's patent details a system for detecting when a number of registrars are colluding to dropcatch domains and then proceed to mitigate such activity. This is seemingly just about preventing the likes of dropcatch from using 1000+ registrars to monopolize the drop. DropCatch monopolizing the drop is a step towards centralization. Preventing any one entity from dominating the drop is seemingly to decentralize the release of expired domains again. Again, I don't see how this would increase prices and competition for domainers, versus the current unfavorable status quo that has undeniably increased prices and competition.

full pdf.

xyo · Feb 4, 2018

While reading through the thread I also thought of that patent from Versign again, which came up last year.
Just took a quick look at it again, and I think what they have in mind with this patent/technique is less the 1000 shell registrars from DropCatch (which are quite obvious as they're all called the same) but more the approach NameJet or Snapnames took (don't know which of them it was) by using other (regular) registrars access for dropcatching. This is something which cannot be detected preliminary, but could be detected by that system.

Recently I was quite surprised they are even using the accreditation of RRPproxy (see domain laptopworld.com with their default interimnameserver.com assigned and even after a month now without whois-entry at RRPproxy themself). Suprised they are giving away their accreditation to them.

Kate · Feb 4, 2018

@Arca I have had a look at the Verisign patent.
What they are proposing is a probabilistic model to mitigate coordinated dropcatching attempts. That means some registrars might be unduly penalized from time to time. This amount to discrimination and raises issues of competition since under current rules all registrars must be treated equally. So I think this could be problematic and I doubt they would be allowed to go ahead with these plans. But is OK is to throttle access as long as all parties are subject to the same rule.

You are right though, what we have now is a form of centralization by DC.
But they paid dearly to achieve that position of dominance and I am not sure their business model is sustainable but I haven't seen the books. I have to say I am surprised it can still be viable on such a large scale.

In the past decade, there was a lot of money to be made in dropcatching, until the registrars figured out that they were throwing money away by allowing great names to expire and drop, so they decided to retain the 'abandoned' inventory and invented the prerelease model to sell off the domains registered by their customers (for some registrars that must be the main source of revenue: new registrations bring low margins...).
So the number of quality domains dropping started to decrease. Nowadays few premium domains drop, but maintaining an army of registrars is expensive, just to catch a dwindling supply of crumbs.

In the end, Verisign could raise up the ante and make dropcatching even more expensive. Then different things can happen:

DC will have to jack up prices in view of the heavy additional investment required => end users pay more, nobody benefits
DC is driven to bankruptcy and out of the game like Pool before, and Pheenix more recently
Ultimately we could be going back to square one with a larger number of smaller players like a few years ago

At this point pure dropcatching is getting less lucrative over time.

Asfas1000 · Feb 4, 2018

Kate said:
Verisign could raise up the ante

How can that be ?

Arca · Feb 4, 2018

Kate said:
You are right though, what we have now is a form of centralization by DC.

But they paid dearly to achieve that position of dominance and I am not sure their business model is sustainable but I haven't seen the books. I have to say I am surprised it can still be viable on such a large scale.

HugeDomains expanding their footprint beyond the drop to the extent they have done over the past year seems to indicate the scarcity evident in the pen del pool.

GoDaddy has acquired a number of pre-release expiry streams from other registrars. However most of these registrars were sending their names to SnapName/NameJet prior to moving over to GD, so this had a more limited impact on the pen del pool. If GD adds registrars that currently let their domains go directly to pen del (such as annulet, gandi, rebel, cronon ag, fast domain) this would significantly drain the pen del pool. This might be why DC is now not just dominating the drop with their dropcatching capabilities, but why HD have also started dominating GoDaddy pre-release with their automated bot bidding activity.

DC will have to jack up prices in view of the heavy additional investment required => end users pay more, nobody benefits

I don't think they will increase prices even if it becomes significantly more expensive for them to DropCatch. With their open auctions model they benefit the most when there are more than one backorder and the domain goes to a public auction, and lower prices are a way of attracting more backorders. Many domains to go public auction with two backorders. That means somebody almost got that name for $59 - instead such names often sell for $500-1000 in the open auction when a number of additional bidders join in. If DropCatch increased prices even just to $99, a lot of the domains that get 2-3 backorders would not get enough backorders to go to auction, and DropCatch would ultimately earn less from these names as a result.

DC is driven to bankruptcy and out of the game like Pool before, and Pheenix more recently.

Pheenix was rarely more than a minor player in the dropcatching game, already on the margin, so a small market change (the deflation of the CHIP bubble) was all it took to push them off the edge. HugeDomains is completely dominating the drop and have a 4,000,000 domain portfolio that generates revenue as well. It's going to take a lot more for them to face the same fate as Pool and Pheenix imo.

Ultimately we could be going back to square one with a larger number of smaller players like a few years ago

I think this scenario would benefit the largest number of people, as the current system means nearly all names go to DC and are then funneled to a small pool of buyers that buy up most of the inventory there (they don't primarily buy what they themselves "want"/backordered, they buy what you wanted/backordered, thus making it a lot harder for anyone to buy a name on the drop as you inevitably have to outbid all these additional bidders that seemingly just use DC to bid on what other people have backordered). Anything that doesn't get backordered for $59 gets caught for the house, virtually establishing a $59 floor for pen del names (and $59 is if you're lucky and the name doesn't go to an open auction).

A number of small players successfully catching domains again would give a lot more people a chance to acquire a domain on the drop, and at different, likely lower, price points than what is currently available.

Mike Mann · Feb 6, 2018

Kate said:
Ah Verisign... they sure have some ideas to 'level' the playing field.

that would be paying off senators to maintain the monopoly, which is how it was created

thebutler · Feb 7, 2018

I do not see anyone calculating in how many domains are purchased by the monthly payment options. These domains would keep Huedomains listed as the owner and than switch at some point.

Unless we see those numbers it would be hard to figure out the success of the business model.

FYI I have had some success with Godaddy this week even when I bid early in the expired domains 10 day period. Certain business niche and I still got them for my $12 opening bid.

UXela · Feb 8, 2018

FYI: I think the number of watchers info has been removed from the closeout domains.

xyo · Feb 20, 2018

Does anyone know if that "corporate partner" ist just a disambiguation for HugeDomains or if there are other partners?
Maybe those chinese sites like jinmi/juming which act as proxy for other backorder services.
Or do they only use fullprice and/or discount club backorders?

offthehandle · Feb 22, 2018

xyo said:
Does anyone know if that "corporate partner" ist just a disambiguation for HugeDomains or if there are other partners?
Maybe those chinese sites like jinmi/juming which act as proxy for other backorder services.
Or do they only use fullprice and/or discount club backorders?

If you don’t pay the $59, Just wait 2 days after you lose the name, and go to the name it will be sale page for HD. Repeat that over and over. Do that for 6 months, and you will probably conclude what I have, it’s an honest system imho.

I am yet to see any other thing going on. In 500 transactions so far, mostly missed or I under bid, or lost auction or won, I am yet to see anything amiss with games going on. I have never seen a “lost to partner” domain I lost go to a First or Juming Chinese bidder, so if you do see something amiss post it here.

HD is *the* corporate partner, and if anybody can provide evidence otherwise, we should all know immediately.

werty · Feb 23, 2018

HD is the only corporate partner I am 99.99% sure. The only way to beat HD is a $59 bid. Otherwise, people would easily go around it. That's not going to happen. Everything else is just discount club.

MapleDots · Feb 23, 2018

werty said:
HD is the only corporate partner I am 99.99% sure. The only way to beat HD is a $59 bid. Otherwise, people would easily go around it. That's not going to happen. Everything else is just discount club.

I bid up to $250.00 on a number of two word (not common) domains and lost to HD, I don't think your ceiling is accurate.

werty · Feb 23, 2018

What do you mean you bid $250? The discount club is up to $58... My previous comment was answering the question in regards to dropcatch not gd, just in case...

If Gd, I think I read somewhere that they are placing $293 bids or something like that..

Michael M · Feb 23, 2018

werty said:
What do you mean you bid $250? The discount club is up to $58... My previous comment was answering the question in regards to dropcatch not gd, just in case...

If Gd, I think I read somewhere that they are placing $293 bids or something like that..

Yea... This thread is about HD bidding at Godaddy - not about names getting grabbed from discount backorders at DC.

MapleDots · Feb 23, 2018

Sorry @werty my bad

Been losing so much to HD, it's making me see things now

wwwweb · Feb 23, 2018

werty said:
What do you mean you bid $250? The discount club is up to $58... My previous comment was answering the question in regards to dropcatch not gd, just in case...

If Gd, I think I read somewhere that they are placing $293 bids or something like that..

I’m sure they are reading this, as well as change their high low outputs, to stay random so nobody can force their max.

Otherwise there are enough small players if they saw hugedomainscij the auction they would push them to their max, and walk away, trust me I have seen others do it enough times to know it’s more than random.

If you owned an auction house, who wouldn’t love a robot standing there, and bidding all day long, sometimes even bidding on stuff that is not on their radar, but comes into their radar based on abnormal bidding patterns.

You are just paying an automation tax pretty much.

I am sure some stuff gets thru the cracks, as it always has, but that margin is getting slimmer, and sometimes those flier type domains are costing $2xx now.

Huge domains has effectively pushed the price of that $12-80 inventory, to $100-$2xx. Many people are going to be sitting longer with more expensive dead inventory.

You have to change the eco system, you can’t feed your competition to compete against you.

HugeDomains.com is Buying 50%+ of Expiring Domains at GoDaddy.com

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