Registering, buying or selling of internet domain names has been a big business for about a decade for several people with an estimated value of $2 billion. This is expected to double by 2010 with 90,000 registrtions a day.
Registration of new domain names with registrars has been on the rise. According to VeriSign Inc., by the end of March 2007, as many as 128 million domain names were registered all over the world, representing an increase of about 31 per cent over the previous year.
Some of the prominent internet domain names transacted last year included sex.com for $12 million, creditcheck.com for $3 million, blogging.com for $135,000 etc. Good domains may cost upwards of $100,000. There are thousands of domain names being traded at sites like sedo.com, dnforum.com and afterenic.com.
Most of the lucrative domain names in .com, .org, and .net have been taken over. Domains ending at .com have been the most leading amongst the whole category of Top Level Domain Names (TLDs).
There could still be many free domain names from other categories like .edu, .gov, .net, .info, .biz, .name etc. However, of all the names dot com names are clear winners. One can also be on the look out for expired or expiring domain names and for buying cheap for reselling.
The idea behind generic domain names is that people may type them directly in address bar and not in search engines. Once a web page appears, money can be made by pay per click advertising.
Generic domain names provide links and ads for the companies associated with these names. When people visit those website, they may click on PPC ads. The revenue gets shared between owners and hosting companies. Godaddy.com is a very popular website for parking of domain names and PPC revenue sharing.
The value of domain names can be directly related to the amount of traffic that a domain generates. For example, names like sex.com could generate millions of traffic and justifiably it went for $12 million.
The domain name industry is like real estate on the Internet. It has grown exponentially over the past 10 years and is still growing fast. A domain name can be held like a piece of real estate investment. One of the popular places where auctions of domain names take place is Manhattan. This place attracts big players in the industry.
One important precaution that needs to be undertaken is that one should not choose a name which corresponds to a trademark name of somebody.
The ICANN is in the process of generating more TLDs. This provides an opportunity for some people to register or buy variations of domain names from those categories and reselling.
It is uncertain as to how far the domain name industry will survive. But it looks to continue to thrive for a long time to come in view of the worldwide expansion of Internet and desire of people to make a presence on the net.