How Much Is That Domain In The Window

November 22, 2006
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The Web site grandrapids.com is not operated by the Grand Rapids Area Chamber of Commerce, by the city or by residents of Grand Rapids, Minn. Nor is the domain name, as Internet real estate is commonly called, the property of a local media outlet, community group or other enterprising citizen.

As it turns out, a mail-order trinket firm in Texas, BroderickCom, is the proprietor of grandrapids.com. Represented by CPA John Broderick, by all accounts a fictional character, the company registered several hundred domain names in the mid-1990s, starting with every conceivable moniker for the baubles it sells — love charms, cuff-links, 14-karat gold charms — and later registering city names such as topeka.com, northdallas.com, trenton.com, davenport.com and a slew of others.

The domain-name rush began with the advent of the Web in the 1990s. The fad jumpstarted the dot-com bubble, most notably in 1999 when Bill Fisher, a young Colorado entrepreneur, sold the beer.com name he registered six years earlier to Labatt Breweries of Canada for $7 million. He also registered budweiser.com and guinness.com, but under legal pressure, later traded both for free beer and airfare.

The most notable local case of this practice, which today is known as “cybersquatting,” was when former Kent County employee Kimberly Scott registered the domain name devosplace.com ahead of the Convention Arena Authority in 2001. More recently, Grand Valley State University student Alan Fleming registered rivergrand.com the morning the name of the famous “mystery development” was made public.

“You have to think of it like real estate,” said Paul Emery, principal of Oakgrove Computer Group in Grand Rapids. “Location, location, location. … It’s like when Michigan was first settled: Anybody could go out and make a claim. If you got there first, you got it basically for free.”

Largely ignored were Native Americans with legitimate rights to that land, Emery noted, and there were claim jumpers, as well. He has not made a practice of doing either. He launched the portal lansing.com a decade ago with the now defunct Lansing Capital Times newspaper, and now operates it in partnership with RE/MAX of Lansing and restaurantdb.net. He would consider selling the site, he said, but has never received a serious offer.

Emery estimates a domain such as grandrapids.com could some day fetch $100,000, though he would advise against such an investment.

Spencer Hawes, editor and publisher of The Hook, an alterative newspaper in Charlottesville, N.C., doubts that will ever happen. He has twice attempted to acquire charlottesville.com from BroderickCom, and has yet to receive a response from the company.

“It’s extremely frustrating,” said Hawes. “I type in ‘X’ city.com whenever I’m visiting an American city and looking for a place to stay, eat and recreate. So typing in charlottesville.com and finding a bunch of cheap little silver charms is an annoying experience.”

Hawes said the practice violates the spirit of the Internet, which suggests a uniform resource locator (the technical term) appropriate to the subject matter. He compared it to the early days of the Internet, when whitehouse.com was a porn site and squatters would snag trademark names and any domain that happened to lapse.

BroderickCom has a different model than most squatters. It uses the city sites to drive traffic to its mail-order business, with the hope that a percentage of those that erroneously view it will purchase a sterling silver alligator charm, baptismal medal or baseball player cufflinks.

Pornography vendors used the same model for many years, gobbling up domain names for cookie-cutter sites, but sexual material now accounts for less than 3 percent of global Web content. Squatters today commonly use barebones placeholders, incorporating paid links and Google Ads.

“The land rush for domain names passed with the Internet bubble,” said Charlie McGrath, chief creative officer of Structure Interactive in Grand Rapids. “People have found there are better investments to make.”

Between the six major domain extensions recognized by the Internet Corporation for Assigned Names and Numbers, there are currently 79 million active domain names listed through a dozen different registration services, roughly 59 million of those in the .com extension. On the day this article was written, nearly 1.6 million new names were registered, and over 1.4 million were allowed to expire.

It costs $5 to $20 to register a name for a year, with discounts for bulk purchases. There is no available data concerning what percentage of these domain names is constructive use.

With so much clutter on the Internet, the value of a domain name such as grandrapids.com is questionable at best, according to Bill McKendry, chief creative officer of Grand Rapids advertising firm Hanon McKendry.

“It used to be that this would be the most logical place to go for information on Grand Rapids,” he said. “But I think people are more likely to just put ‘Grand Rapids’ into a search engine and see what comes up.”

In doing so, grandrapids.com does not appear in the first 10 results. In fact, McKendry had never before set eyes on grandrapids.com, and his firm is responsible for the Downtown Development Authority’s ongoing branding campaign. It uses the Web site downtowngr.org. Derivations, including downtowngrandrapids.com and downtowngr.com, are registered to speculators.

McKendry has had his own run-ins with squatters and thought little of it. The domain hanonmckendry.com was registered by squatters in 1996, and McKendry never entertained a dialogue with the speculators. His firm uses hanon-mckendry.com to this day. Interestingly, the registration on the former domain expired years ago, and the firm obtained it in 2004, but does not actively use it.

“You’re better off just picking a name and marketing it from the outside,” McKendry said.

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