I've been working on developing a no commission domain name auction for almost 4 months now. It's not as simple as it sounds and the costs involved in starting this are well into the XX,XXX (an open source auction script won't do and even most commercial scripts will need heavy modifications [re: megabucks] to be able to handle anything remotely close to the membership numbers seen on Sedo/Afternic).
The best I'm aware of if you do choose to develop this site is PHP Pro Bid imho. There's no way you could even get 10% the size of Sedo with this script though... It's just not made to handle that kind of load. You're looking at close to $1000/month for a RAID 10 dual Harpertown setup -- which is the bare minimum you'd need to give this a serious shot. I seriously doubt you could handle more than 20k members on such a server if you're providing all the bells and whistles PHP Pro Bid provides (feedback system, store function, ability for members to upload pictures, "about me" profiles, BIN/Make Offer functions,...). Having 600k members like Sedo would mean having costs of conservatively $30,000/month (not to mention that you're certainly going to need staff if this thing started to really get popular).
I thought about doing it no commission, no listing fees, no signup fee long and hard... It's just not feasible imho. I've decided that when I launch it'll be with an annual membership fee and provide members with a no commission, no listing fee.
If you charge no fees whatsoever, you'll run into many problems....
1. Scammers - By making members pay a signup fee by Paypal/Moneybookers in example, you now have their information on file. Assuming you only accept "verified members", you could cut down on scamming dramatically. Because Sedo + Afternic handle the escrows, they don't have to worry about scammers -- there's no way to get scammed. You, on the other hand, certainly wouldn't have the manpower to handle the escrows and would have to focus on making the site as safe as possible (SSL, hardware firewall, some custom security features [eg. automated telephone verification]).
2. Non-Paying Buyers - What's stopping anyone from signing up and not paying for purchases they supposedly made? Even if you IP ban, there are ways around it... And with no fees, you're making it pretty easy for any troublemaker to just make a new account.
3. Uncooperative Sellers (or worse) - Sellers listing items in the wrong categories, inexperienced sellers not knowing what they're doing and frustrating your buyers,... What about the sellers who jump ship after being paid? Namepros is a nice community of friendly domainers and most people are honest here, but it's not the same when you open up for business to the whole World Wide Web.
I could list a bunch more points... As I said, I've put alot of time and effort into this and it really isn't as simple as many people would like to believe. If it really was, it'd have been done already. Several members around here have told me they've thought about doing just this themselves but when they looked into it and realized the costs, risks, and likelihood of success (extremely low), they opted not to follow through with it.
Ask yourself why you're interested in doing this. If it's to make money, we can all suggest safer ways to make a steady stream of cash domaining with little risk. Believe it or not, there's probably close to 50 domain auction sites out there -- you just would never hear of them because they flopped royally.
Alot of industries have only 1 dominant auction site in their niche.
If you do decide to follow through with this, pick yourself a niche -- you can never compete with Sedo, nor can I, and nor can likely anyone else in the world... They're the eBay of the domain name industry -- they charge relatively high fees, but they have all the buyers and all the sellers.
Chances are that even with a zero percent commission, people will still be better off at Sedo. And for the Catch 22 : Sellers are looking for Buyers... Buyers are looking for things to Buy. It's a very delicate balance. Botch it and you'll be just another forgotten victim.
I'd be happy to discuss your plans and share mine with you. Feel free to pm me if you'd like to talk more about it. There's plenty of opportunities in the auction segment but presentation is absolutely critical to success. If you look at the successful sites (aside from eBay and maybe uBid) that are out there, there only are a couple other half decent auction sites (eg. WeBidz.com) that target the same niches as uBid and eBay -- one could even say that uBid is fundamentally different due to it's "Buyer Protection".
Sedo = eBay. Don't compete with eBay, create your own little niche. Pick a domaining segment, be it short domains, generics, domains under $1000,... There's plenty of things that could be done here but trying to tackle the entire domain market is a fatal mistake, that I can promise you.
Daryljames101 said:
I'm sick of the domain auction sites... I've absolutely had it with their ridiculous fees...terms... opinions...
So I'm setting up a Free auction site... Ad supported...
This thread is for feature requests...
Please tell me what you want to have, and I'll do my best to do it...
It should only take me a week or so if everything goes right... the categorization will probably be the toughest part...
The background will certainly be "Rick Latona" joking...
But seriously this site will be for you guys...
The name unless someone has a better one up for grabs will be
Nameloco.com
So thats it...
Thanks in advance for the feedback...
Well it's been 15 min with no response... Can't wait any longer... I'll be back...
