Dynadot

analysis 56.com written down by USD $7.2 million, implying it cost at least that amount!

Spaceship Spaceship
Watch
Impact
3,143
I think I found a very high value transaction for the 56.com domain name, revealed in a strange way. According to p. F-55

https://www.sec.gov/Archives/edgar/data/1734107/000119312520112755/d844508d20f.htm

Sohu revealed that:

Impairment Losses

In 2019, Sohu recognized a $7.2 million impairment loss for a domain name related to the 56.com Website, mainly due to enhanced restrictions that Chinese regulatory authorities imposed on the broadcasting industry, which had an adverse effect on the operation of the 56.com Website.

This means that they paid exactly USD $7.2 million if they wrote down the value to zero. Or, if the domain name still retains some residual value in their accounting (it would likely still be worth 7-figures WHOLESALE, given 3-digit dot-com domains are worth at least USD $300K these days wholesale, and 2-digit dot-coms are much more valuable than 3-digit dot-coms), this would imply that they paid *more* than USD $7.2 million originally.

In other words, to recognize a $7.2 million impairment loss, it had to have been on the books for more than that!

It can't be currently charted by DNJournal due to the lack of precision, but might be worth additional research (going back through their older SEC filings at some point, or reaching out to their investor relations, etc.)
 
10
•••
The views expressed on this page by users and staff are their own, not those of NamePros.
Actually, to be more precise, even if they wrote down the value to zero, it could still have originally cost more than $7.2 million if they had since depreciated some of that original purchase price.
 
1
•••
0
•••
After doing more research, it looks like (according to Wikipedia) Sohu paid a rumoured USD $25 million for the 56.com website (content plus domain name):

https://en.wikipedia.org/wiki/56.com

So, it wouldn't have been a pure domain name transaction at the time of purchase. But, clearly they placed a high value on the domain name itself, for it to be able to be written down by USD $7.2 million.
 
Last edited:
6
•••
0
•••
0
•••
Back