Wow: Amazon.com buys .Buy for $4.6 million, .Tech sells for $6.8 million

[TomTom1]

Amazon.com paid $4.6 million to win rights to .buy top level domain name, but that wasn’t the most expensive TLD auction on Wednesday.

You might think new top level domain names aren’t meeting early expectations, but applicants still apparently value the opportunity very high.

ICANN held its second “auction of last resort” for new top level domain names today. Three contention sets were resolved at multi-million dollar prices.

Here are the results:

.Tech sold for $6,760,000 to Dot Tech LLC. I’ve heard of some private contention set auctions closing for about this price, but I suspect this is a record or close to it. Three bidders bid at least $6.2 million in the auction. (I’ve heard it’s not a record, but definitely toward the high end.)

DotTech beat out Google, Uniregistry, Nu Dot Co, Donuts and Minds + Machines.

.Buy sold for $4,588,888 to Amazon.com.

Amazon beat Google, Donuts and Famous Four Media in the auction. PVT Registry did not participate. Only two bidders bid above $1.5 million.

.VIP sold for $3,000,888 to publicly traded Minds + Machines.

It beat Google, VIP Registry, Minds + Machines, Donuts, I-Registry and Vipspace Enterprises LLC. Three bidders were willing to pay at least $2.2 million in the auction.

Unlike with private contention set auctions, the losers in these auctions walk away with nothing, other than a small refund on their application fee.

- See more at: http://domainnamewire.com/2014/09/17/amazon-dotby-dottech/#sthash.ZkC1v3lE.dpuf

 

[N-A]

So they gotta sell 140k tech names at $50 each or take a ride on the wild side and sell 1 million at $7 (inflated so registrars get a cut) in order to break even on just the application fee the first year (not including operations and other costs we don't see)...

Amazing when .xyz is at 511k "registered" and 500k were free.

Looking at other similar priced gTLD's; such as the leading geo .london @ about $50, they have 40,000 "sold" (unknown if they gave away freebies).

I suppose it's doable within 1 year to break even looking at .london and how .tech is more broad; especially since they can auction premium names like iot.tech for thousands later on, when and if they make the cut.

Or, they're out for the long term investment... either way notregisteringa.tech as you bet every tech related product/term that has high search volume/competition/CPC will be reserved, have premium pricing attached or auctioned off for more than face value before they are on the brink of bankruptcy.

 

[The New Guy]

Or they're out to own a big slice of the .buy pie

tablet.buy goes to amazon's tablet sales page
shoes.buy goes to their shoe store
music.buy goes to their mp3 store
etc

Just like with most of the other new gTLD's - keep the best, sell the rest.

 

[DU]

So they gotta sell 140k tech names at $50 each or take a ride on the wild side and sell 1 million at $7 (inflated so registrars get a cut) in order to break even on just the application fee the first year (not including operations and other costs we don't see)...

No business of size steps into a new arena looking to break even in one year when the model is a recurring revenue model.
But then, for a company that lost $127M in Q1 2014 - I'm not sure that their business model cares much about instant profitability. It hasn't got there in 20 years. Then again, the investors don't care either.

 

[N-A]

No business of size steps into a new arena looking to break even in one year when the model is a recurring revenue model.
But then, for a company that lost $127M in Q1 2014 - I'm not sure that their business model cares much about instant profitability. It hasn't got there in 20 years. Then again, the investors don't care either.

While that is true, companies do often try to break even within 18 months of their initial investment. The reoccurring revenue model only works if there isn't a sudden surge in drops from speculators, or they will fail within that time frame with the direct and indirect costs that they are facing each day of operation.

 

[JudgeMind]

with these big players investing in the new extensions there should be a good reseller market for us domainers...

 

[N-A]

with these big players investing in the new extensions there should be a good reseller market for us domainers...

How many times are you going to renew $25-$50/yr domains before an aftermarket exists? Will you have enough capital to stay in the game? Did you pick winners or losers on the aftermarket? Who will dictate that?

Reminds me of when I was a youngster and couldn't afford $99/2 yr. renewals on LLL.com's and generics at NetSol. I missed out, but there was nothing I could do to raise capital as I was below employment age and just couldn't come up with the funds by begging and crying as nobody saw a future in what I saw. I don't even want to go back in history to see which ones I owned and if they sold/are in use by end users. It would just make me cry harder.

 

[Name Trader]

@David Walker - Thanks for the trip down memory lane If one thing is for sure. History is about to repeat itself.

 

[-EM-]

We'll see if they will be opened for public registration.
If yes, we will have .tech and .technology.

 

[Name Trader]

I think Amazon got .buy cheap at <$5M, imho. Rakutan bought buy.com for $250M cash. That's only 1 domain. Amazon could easily develop any subdomain and quickly have the 12M customers Rakutan paid for within the $250M.

 

[tomcarl]

I don't think the 7 figure sale of a gTLD says much about the market. Amazon acquiring .buy could be a long-term strategy or defensive/speculative purchase should PayPal/eBay or another major marketplace would've acquired it - A matter of beating competitors to the punch, or maybe they'd give their sellers their own .buy domain domain along with a store subscription. Username.buy

 

[N-A]

I don't think the 7 figure sale of a gTLD says much about the market. Amazon acquiring .buy could be a long-term strategy or defensive/speculative purchase should PayPal/eBay or another major marketplace would've acquired it - A matter of beating competitors to the punch, or maybe they'd give their sellers their own .buy domain domain along with a store subscription. Username.buy

No, they're just mad that they couldn't get their brand (.amazon) and picked the next best thing.