Is it really profitable to speculate on domain names?

Published: 26/02/2011 05:00



A bustling domain name market has been taking shape in Vietnam, where many people are getting rich quickly by trading domain names for sky high prices. However, experts have pointed out that it is not easy at all to earn money with domain names.

A lot of questions have been raised about this kind of business: What percent of trades are successful? How high are the prices of the domain names? Is it true that domain name speculators can earn large profits?

Trading domain names … for fun

Domain names are being offered for sale on many websites, which are called “the domain name markets”. If accessing online trading floors such as raovatdomain, tenmienthuonghieu, moigioitenmien, or shoptenmien, people may get surprised when seeing that a domain name may be priced at $200,000. The domains listed for sale for hundreds of thousands of dollars are advertised as “special commodities” because they coincide with the names of famous individuals or well known businesses. Especially, some foreign domain names are even sold for several million dollars.

It seems that there is no rule in selling domain names on websites. Dung, the administrator of Ten mien thuong hieu trading floor, said that experienced speculators always consider the fame of individuals and institutions to set sale prices. There are domain names for which sellers ask for tens of thousand dollars, however, in fact, they could sell only for a several hundred dollars. According to Dung, 80 percent of successful domain name transaction deals on the floor have prices between $350 and $500. Meanwhile, raobantenmien also said that domain names are priced at less than $500 in general.

In Vietnam, people have also been trying to speculate domain names after they realized that the speculators in foreign countries can earn profit from speculation. However, not all speculators can succeed in the trade. According to Khai from raobantenmien, the success regularly goes to foreign individuals, who can anticipate the profitability of the business and they register “beautiful names” very early.

Khai revealed that he himself once speculated tens of domain names, but he has given up on them because he could not find buyers. Now Khai only keeps some “nice” names for fun because  he cannot profit from the business while he has to spend money to maintain the domain names.

Businesses not ready to purchase domain names

Though realizing the importance of domain names, Vietnamese enterprises do not spend much money to purchase domain names. According to Dung, the expenses of $350-500 are reasonable for businesses to purchase domain names to protect their brands. Meanwhile, the expenses of several thousands dollars are affordable for few enterprises. And small enterprises will not spend hundreds of dollars to regain domain names.

Several years ago, the owner of thegioididong brand successfully purchased thegioididong domain name at $200 or $300. According to Khai, the price level truly reflects the current market situation.

Speculators once hoped that they would earn a profit when famous people tried to purchase the domain names coinciding with their names. However, they were wrong: famous people are not interested in making such deals. On raovattenmien website, there are a lot of domain names coinciding with the names of famous people on sale, including (singer Dam Vinh Hung), or (businessman Tran Dinh Long, the owner of Hoa Phat Group). However, the domain names still have not found buyers.

However, the owner of trandinhlong domain name still cherishes the hope that the domain name will be sellable in the future. “In just some more years, when e-commerce develops well, the domain names will become valuable,” he said.

Source: VnMedia

Provide by Vietnam Travel

Is it really profitable to speculate on domain names? - Features - In depth |  vietnam travel company

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