Llll.com undervalued or lll.com overpriced?

[1john2004]

My calculations are:
There are 17.576 lll.coms
There are 456.976 llll.coms

The quantity of llll.coms is 26 times as lll.com
Minimal price for any lll.com is $6.000
Does it mean that min. price for llll.com must be 6.000/26=$230.

What do you think?

 

[jacal1]

Hi John. I'm not sure I understand.

 

[1john2004]

Hi John. I'm not sure I understand.

Hi,
Both subjects have the same nature. They are only letters. In our case this is different quantity of letters. The only thing that makes them so valued is their rarity.
Nothing else. From my point of view the price difference must be according their numbers. That simple.

 

[sparkplug]

I'm still a newbie to the domaining field (< 1 yr, fortunately I was able to grab my share of a dozen or so LLLL.coms), but I wonder how much (if any) the availability of LLLL.com drops will affect their value. Drops available @ reg fee will certainly become more rare, but this isn't even a factor when it comes to LLLs -- it's virtually guaranteed that they will be backordered well before they drop.

Do you guys think drops are a reasonable factor to take into consideration when theorizing about the value of LLLL.coms vs. LLL.coms?

 

[jacal1]

Hi,
Both subjects have the same nature. They are only letters. In our case this is different quantity of letters. The only thing that makes them so valued is their rarity.
Nothing else. From my point of view the price difference must be according their numbers. That simple.

I think I'd disagree because I was talking about quantities too, although the differences between a .25 carat and 10 carat diamond, for example, might be akin to a pronounceable vs. a bad letter non-ponounceable.

 

[VURG]

I think that the market reflects the current value of a domain. I don't use the term undervalued for a type of a domain because if it were undervalued, the market would correct itself quickly.

I think that good LLLL.com like premium CVCV.com have more potential than poor LLL.com. I have no idea what will happen with the minimum value of LLLL.com over the next few years but I expect it to rise. This is because of the potential of the names in a growing market, not the market undervaluing it.

 

[cache]

LLL is over valued.

 

[italiandragon]

I think that many people still don`t get in their head this info:

In the world , currently the AVERAGE INTERNET PENETRATION is ONLY 18 %

(from www.internetworldstats.com)

Not only the value of short domains is based on their rarity but also from their MEMORABILITY and BRANDABILITY.

So, for example yes I think that names like SNNN.com are very undervalued.

 

[sashas]

I think that many people still don`t get in their head this info:

In the world , currently the AVERAGE INTERNET PENETRATION is ONLY 18 %

(from www.internetworldstats.com)

Not only the value of short domains is based on their rarity but also from their MEMORABILITY and BRANDABILITY.

So, for example yes I think that names like SNNN.com are very undervalued.

Lorenzo, the trouble is that the regions that will see the largest growth are also composed of people that won't pay huge prices for domains.

Yes, premium LLLL.coms are undervalued, just as premium LLL.coms. But in the non premium category, things start to appear a bit tricky.

 

[italiandragon]

Lorenzo, the trouble is that the regions that will see the largest growth are also composed of people that won't pay huge prices for domains.

Yes, premium LLLL.coms are undervalued, just as premium LLL.coms. But in the non premium category, things start to appear a bit tricky.

My point was not that poor Chinese or Indian people will come online and buy LLLL or LLL but rather than:

the internet users will go from 1 Billion (now) to (3 or 4 Billion people):

more clicks on ADS , more money going around , more traffic , more everything.....
Don`t you think that then current companies will have more money to spend?

And not to mention the new companies.

And who knows.....maybe in 20 years , even Chinese and Indian people will buy LLL and LLLL

 

[sashas]

Hmm..
I didn't see that point. Yeah, more people = more ad money thrown about.

As it stands today, within 6 months, LLL.coms will have a minimum reseller price of around 10k. Already its impossible to find anything in the reseller market for less than 6-6.5k

 

[-REECE-]

Elaborating on Sashas main point, if I'm reading this correctly, is that we must properly account for holding costs and opportunity costs associated with our LLLL.com investments -- which I think is a very valid issue to discuss.

If I can't get $100 for a name I regged today 5 years from now, then to me, that was a failure. Over those 5 years, I invested $40+ (let's not forget those Verisign hikes) and more importantly, sacrificed the opportunity of investing that $40 elsewhere.

LLL.coms are going up at about 60% annually as of late. If you do the math on that, $8 invested into LLL.coms (hypothetically speaking) should return upwards of $80 five years down the road, assuming the current rate of appreciation remains consistent. If you do the math on how much having your money tied up in LLLL's costs you over 5 years in potential lost opportunities in LLL.com investments, you end up with about $200 (60% annual interest rate on the $8 the first year, $16 the second year,... [hence my statement of wanting $250 for my names 5 years from now]).

LLLL.coms will be profitable. I don't think anyone will disagree with LLLL.coms (especially the 90%+ with only 0, 1, or 2 bad letters) selling for more than their cumulative renewal fees. But whether they will prove to be an excellent investment (in light of alternatives) is another matter, for which we'll have to wait and see :imho:

 

[VURG]

When you have one or two LLLL.com with poor letters, you don't have a lot of options with what to do with them. When you have a portfolio of hundreds, your combined portfolio has a very good chance that one will best fit your objectives when required.

 

[sashas]

I think Reece raises some very very important point. Money tied up in investments is money you can't spend elsewhere. There will be times when you'll find an amazing name going cheap and just wonder, "man, If I just had the free funds...". Its at times like these you'll want some really liquid names. Personally, I don't see a profit of $50 in 5 years as worth anything.

So for now, I'm staying away from the 2 bad letter names

 

[RareIQ]

4 Letter .com's ending in the following letters will be versatile in better demand as the following examples indicate:

For example a domain VDDE.com could actually be as good as VDD.com as the " E " on the end could be VDD.com Entertainment or the 4 letter domain VJBN.com could actually be
" Video Jockey Business Network ".......more examples:

Prime ending letters of a 4 Letter .com

" E " for Enterprise, Entertainment, etc.
" I " for Incorporated, etc.
" A " for Association, Associates, etc.
" N " for Network, etc.
" B " for Business, etc.
" M " for Management, etc.

 

[snoop]

My calculations are:
There are 17.576 lll.coms
There are 456.976 llll.coms

The quantity of llll.coms is 26 times as lll.com
Minimal price for any lll.com is $6.000
Does it mean that min. price for llll.com must be 6.000/26=$230.

What do you think?

That is looking at the supply side only. The demand side is quite different, there isn't 26 times the number of companies using 4 letter acronym's as opposed to 3 letter, in fact the number of companies using 3 letter acronym's is far higher than those using 4 letters despite there being 26 times fewer combinations.

It is end user demand that drives the 3 letter market, despite the bottom end mainly only having appeal to collectors, they are valuable because the much nicer "house next door" is worth a lot. The other thing is that effectively the the 4 letter domains have far higher fixed costs (registration fees) compared to the value of the domain. ie if someone invested $50,000 in 4 letter .com compared to 50,000 into three letter .com's the holding costs would be much lower for the 3 letter buyer. Registration fees need to be factored into the value of the name.

 

[MadAboutDomains]

There isnt a connection between LLL and LLLL domains. Its what ever someone is going to pay.