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

[Arca]

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

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Related: HUGE DOMAINS SNIPING GODADDY CLOSEOUTS

 

[JB Lions]

Over 4 million now according to article below:

Went from 3 million in August of last year to 4 million, picking up a million in about 5 months or 1/4 of their portfolio:

https://domaingang.com/domain-news/hugest-domains-four-million-under-management/

 

[wwwweb]

This happend with tapping into Godaddy's portfolio, have been testing godaddy auctions for a few days, and it is apparent that Huge Names, Dropcatch, or whatever you want to call them is picking off your bids, in the last 5 minutes, they instantly put a bid of $196, making you pay over $200+ for the domain that way. They are at the same time inflating domain valuations, and as the largest holders they profit from this. So if you are pissed at who is picking you off on that 1 off domain nobody wants, it is their automated bot script that makes you pay $200 for that $12 domain. Either wait for closeouts, or pay $200.

I am not sure but Godaddy has to be elated to have a partner who will autobid $196 for any auction with it's bot, the money is just rolling in.

The losers, all of the above sorry to say. We can only speak with our wallets, nothing else seems to matter. So sorry huge names, I cost you a few grand by pushing you to your max bid, but at least you know what it feels like.

 

[Arca]

and as the largest holders they profit from this.

They now own more than 4,000,000 domains.

 

[Michael M]

What ever happened with HDTV.net? Any developments? Anyone have bidding data?

 

[wwwweb]

They now own more than 4,000,000 domains.

Yes, that are swallowing up everything at godaddy, and causing everyone to pay more. House is the big winner.

 

[Arca]

Yes, that are swallowing up everything at godaddy, and causing everyone to pay more. House is the big winner.

And not just paying more at GoDaddy, this indirectly increases prices at DropCatch too as HugeDomains create more scarcity of inventory at GoDaddy auctions for domainers. This in turn increases demand and competition among domainers at DropCatch for the inventory they have there. DropCatch then take the money we spend at DropCatch and bid against us at GoDaddy, repeatedly reinforcing this cycle.

 

[wwwweb]

And not just paying more at GoDaddy, this indirectly increases prices at DropCatch too as HugeDomains create more scarcity of inventory at GoDaddy auctions for domainers. This in turn increases demand and competition among domainers at DropCatch for the inventory they have there. DropCatch then take the money we spend at DropCatch and bid against us at GoDaddy, repeatedly reinforcing this cycle.

Dropcatch is a dream to win anything over there, people are just climbing over each other to outbid each other, it's insanity, you have to outlay way to much, hold way to long, just to get low ball offers.

 

[Arca]

Some company has placed a $10 bid on every single .com domain that GoDaddy's appraisal tool has valuated at or above $1500, regardless of how inaccurate such appraisal is for many of these names (most are worthless).

The ubiquitous $10 bids go all the way down to $1499. There's no unusual bidding activity for the names appraised by GoDaddy below $1500.

Not surprisingly the company behind these $10 bids was Huge Domains.

Source:
yonkersamateurradioclub.com
entitledlittle.com
naturalanimalhealth.com
bostonbreastcenter.com
mailcult.com

These were among the $10 backorder domains and Huge Domains now shows up in WHOIS for all of them.

After ceasing this bidding activity for a period it looks like HugeDomains is back at it again. Though now their API places the $10 backorder on the domain 5 minutes before the end time.

 

[wwwweb]

After ceasing this bidding activity for a period it looks like HugeDomains is back at it again. Though now their API places the $10 backorder on the domain 5 minutes before the end time.

It looks like it is coming in at the 10-15 minute mark like clockwork, they are sucking up everything, and then some, with no shortage in sight. I have been watching them a bit this week, and bidding into so of their bids to see what happens also. It is to automated to be any other random person, almost like coming off the factory assembly line. I just thought they were watching other people's watch list, but they are just taking everything, I guess based on apprisal, all or nothing kind of attitude.

 

[Arca]

It looks like it is coming in at the 10-15 minute mark like clockwork, they are sucking up everything, and then some, with no shortage in sight. I have been watching them a bit this week, and bidding into so of their bids to see what happens also. It is to automated to be any other random person, almost like coming off the factory assembly line. I just thought they were watching other people's watch list, but they are just taking everything, I guess based on apprisal, all or nothing kind of attitude.

Seems to go something like this: They place a $10 bid shortly before auction end, you place a 15+ bid, they place a $XXX proxy bid. Strange that they don't just use their API to snipe the name as a closeout for $11 instead. Many of these names that end in the $XXX range would have ended with no bids otherwise. Besides HugeDomains there are other parties piggybacking off bids with automated API bids too, so prices are almost inevitably driven up when you place a bid, also for HD - haven't looked into who is behind it, but there is one entity that clearly uses the API for automated bidding that places $5 bid increases when there is 5-10 seconds left, and this can drag out an auction for more than an hour.

 

[wwwweb]

Seems to go something like this: They place a $10 bid shortly before auction end, you place a 15+ bid, they place a $XXX proxy bid. Strange that they don't just use their API to snipe the name as a closeout for $11 instead

You nailed it, I played with them quite a bit this week, when the results of all my losers come back next week, I will update. Exactly what you said, they pile on with that high proxy, and I guess odds are most people quite before $50, but I guess they hate losing.

It used to be fun to kind of go thru, and see if you can find a something that slipped thru the cracks, but now everything comes front, and center, godaddy is not really a good place to buy anymore just a bot / newbie kingdom they all piling on, and paying a pretty penny. Maybe it is a good time to take a few months off, and let huge names backlog themselves with inventory, there is no way they can even come close to selling what they catch, and dropcatch inventory is not as good as it used to be, even though prices are higher than ever, so where does the money come from? If your forced to pay $xxx for every crappy roll the dice name, then you can't win.

 

[Arca]

You nailed it, I played with them quite a bit this week, when the results of all my losers come back next week, I will update. Exactly what you said, they pile on with that high proxy, and I guess odds are most people quite before $50, but I guess they hate losing.

It used to be fun to kind of go thru, and see if you can find a something that slipped thru the cracks, but now everything comes front, and center, godaddy is not really a good place to buy anymore just a bot / newbie kingdom they all piling on, and paying a pretty penny. Maybe it is a good time to take a few months off, and let huge names backlog themselves with inventory, there is no way they can even come close to selling what they catch, and dropcatch inventory is not as good as it used to be, even though prices are higher than ever, so where does the money come from? If your forced to pay $xxx for every crappy roll the dice name, then you can't win.

I wrote here that HugeDomains owned right under 2,400,000 domains on Jan 15, 2017. One year later, early Feb 2018, they own 4,000,000+. They certainly don't seem to be slowing down, they seem to be buying more names anywhere they can in general, and expanding their footprint at GD auctions in particular.

 

[D Haynes]

How is this business model sustainable? Surely they don't have that high a turnover to cover new purchases and renewals. Someone with more brains than me needs to create a bidding program that looks for the patterns associated with a HD bid then auto bids it up to 195 bucks or just below their proxy so they pay full whack for each name.

 

[wwwweb]

How is this business model sustainable? Surely they don't have that high a turnover to cover new purchases and renewals. Someone with more brains than me needs to create a bidding program that looks for the patterns associated with a HD bid then auto bids it up to 195 bucks or just below their proxy so they pay full whack for each name.

Funny you mention that $195 number, because it took $196 to outbid their proxy, that is real money $200 is daily working man's living wage, not what should have to be paid for every crappy domains due to some auto appraisal. So I guess godaddy did them a huge favor by putting those estimates on, they can sort of lean on that number as another added safety net with their bot. We just got to find a way to make them pay $196 for every domain, I had some fun this week with them, they probably won't like their weekly report.

Arca mentions 4M names that is $32M a year just in renewals, $4M per month, plus the cost to acquire each name around $2X on the min each. They are gaming the system much like they did with the drops, now they pretty much run godaddy, godaddy wins because if a newbie, or end user really wants a specific name, they have huge domains as a hedge because they are going to tax everyone who tries to win anything.

Win or lose your going to have to either pay with time wasted, or added bids on top by a bot out of your wallet.

 

[wwwulff]

I do not know if they have a sustainable business model, but if they own 4 mill. names and have a sales rate between 1 and 3 percent per year with an average selling price of $2000, they have between 88 and 240 million to renew and buy names for - To me it looks like an ok model?

 

[wwwweb]

I do not know if they have a sustainable business model, but if they own 4 mill. names and have a sales rate between 1 and 3 percent per year with an average selling price of $2000, they have between 88 and 240 million to renew and buy names for?

You make a good point lets say they generate $150M annually from just these sales, I guess that is where we are seeing the splash, they are cutting the circulation of new inventory solely into their channel of huge domains, from other sources, creating a bigger portal for themselves, I guess they are on a trial and error program themselves. I can't seeing it working, to much to fast. We are not taking into consideration operational costs, They also operate namebright, and dropcatch, which we know what a saga that has been.

 

[wwwulff]

I'm as frustrated as everyone else over their dominance and that they make it harder and harder to buy at good reseller prices, but I still suspect they have a sustainable model - I assume they also make money on both namebright and dropcatch otherwise they probably would not have been there they are now.

 

[wwwweb]

I'm as frustrated as everyone else over their dominance and that they make it harder and harder to buy at good reseller prices, but I still suspect they have a sustainable model - I assume they also make money on both namebright and dropcatch otherwise they probably would not have been here they are now.

Plus they have had a dropcatching edge for many years, so they do have some nice domains in their inventory, so I am sure they make some good sales from time to time outside the typical $1500-$2500 sweet spot. Frustration is the right word, I think Godaddy sold out their platform to them, but then again Godaddy has to watch their bottomline as well, so win win for both those partners.

Huge names can be very petty, I have seen it first hand, I actually bought a domain of theres at BIN on Godaddy for $2,900, they said they repriced it at $3,800, but there was an error in the script update, and it did not register on the system, reach out to godaddy, they said it is not their domain, and they cannot make huge domains transfer it over, so I was refunded, and obviously given their arragment huge names is untouchable on godaddy. Over $900 they wouldn't honor their BIN sale, kind of lame, and godaddy couldn't do a damn thing about it, because they generate to much revenue for them.

 

[Asfas1000]

ICA or Verisign need to do something about it.

Verisign have previously said they would "level the playing (dropcatching) field", but have done nothing as of yet.

There are a lot of $20-$25 "real" - "reseller" - "projected" (whatever you want to call it) value domains dropping every day, that are worth having for $9, but certainly not at $59.

ICA, or any domainer association who cares about the little domainer, need to do something as well. Big boys can support themselves without ICA's help anyway.

Re DC's sell through rate, it's less than 1% AFAIK, which means that every domain they reg costs them more than $900, but their avg selling price is more than $2,000, which makes it worth it. It makes sense, otherwise there would be no point in getting to 4M domains from 2,4M if the business model was not profitable.

 

[Arca]

ICA or Verisign need to do something about it.

Verisign have previously said they would "level the playing (dropcatching) field", but have done nothing as of yet.

ICA, or any domainer association who cares about the little domainer, need to do something as well.

What would this look like policy/regulations wise?

 

[wwwweb]

I have to admit this is the only industry where a bill of sale is not worth the paper it is written on it terms of contractual value.

If I go buy a car, and have a contract/invoice with a price, it is honored, home depot, you name it, only in domaining is the only industry if you have a receipt with a price, it means nothing.

ICA or Verisign need to do something about it.

Verisign have previously said they would "level the playing (dropcatching) field", but have done nothing as of yet.

There are a lot of $20-$25 "real" - "reseller" - "projected" (whatever you want to call it) value domains dropping every day, that are worth having for $9, but certainly not at $59.

ICA, or any domainer association who cares about the little domainer, need to do something as well. Big boys can support themselves without ICA's help anyway.

Re DC's sell through rate, it's less than 1% AFAIK, which means that every domain they reg costs them more than $900, but their avg selling price is more than $2,000, which makes it worth it. It makes sense, otherwise there would be no point in getting to 4M domains from 2,4M if the business model was not profitable.

all these organizations are about the money, trust me nobody cares, or will ever care about the little guy. It is all arbitrage when it comes to huge names.

 

[Arca]

Mike Mann on HugeDomains' business model:

Huge Domains model wont work, too few pct of names have any value, too expensive to renew, too difficult to discover what to delete, too many legal fees...... Eventually they will eat it.

 

[wwwweb]

Mike Mann on HugeDomains' business model:

I mean M M has way more outliers sales, which help pad his bottom line. I will see what huge names best names are a bit later, and now they price them.

 

[Asfas1000]

What would this look like policy/regulations wise?

A lot of things can be accomplished if you have an association with 1,000 domainers.

For instance, stories of newcomer bidders named "HouseHouse" driving the prices to the sky would not remain restricted in just one NP thread.

 

[Kate]

ICA or Verisign need to do something about it.

Verisign have previously said they would "level the playing (dropcatching) field", but have done nothing as of yet.

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