In today’s Internet-centric world, companies of all kinds must establish a professional web presence or run the risk of wasting away in the dark ages. Accomplishing this task is often easier said than done, though, especially when it comes to setting up a website compared to a social media profile. Not only do websites require knowledge of coding and design in order to work, but they also need to have a logical URL address so users can easily access it. This was simple enough to do in the early days of the Internet, leading to current household names like Yahoo, Google and Amazon.
But after more than twenty years of increasingly heavy online traffic, coming up with a unique web address is no longer so easy. Unregistered four-letter dot-com domains officially went extinct in 2013, and since then the field has only grown tighter. After all, a particular web address has a total supply of just one, which has led to a scarcity of available URLs. Oftentimes the best options are already claimed by prospectors who simply wait for someone to come around and pay through the nose for the rights to the address. For instance, the business world was shocked in 2007 when Aaron Patzer traded a 1 percent stake in his personal finance company for the Mint.com domain.
Other companies have paid similarly exorbitant fees: Toys.com cost its new owner $5 million while a company paid as much as $10 million for the address Fund.com. In fact, one entrepreneur went to extreme lengths to secure ValleyGirl.com, going so far as to knock on the door of the domain’s owner and offer her cookies and a conversation. While that person eventually relinquished the rights to the web address, some others want to remain the masters of their domain no matter what the cost. For instance, the founders of a San Francisco startup originally had their hearts set on naming their company Saffron, only to discover that website name had already been taken. Fortunately for them, the domain’s owner happened to live in town. Their luck ran out there, however, when the owner said he’d already received offers for Saffron.com in excess of $1 million and still refused. As a result, the company decided to go with Hired.com for the less hefty cost of approximately $125,000.
Questions:
- Why would companies pay large fees for the rights to a specific web address?
- Is it ethical to register addresses for the sole purpose of selling them?
Source: Christine Lagorio-Chafkin, “High Stakes, Fake Identities: The Great URL Wars,” Inc., December 8, 2014. Photo by: Sam Azgor.