Before the Auction: Bidding on Domain Names

First Published:
Date Published: 2000
Copyright © 2000 by Kevin Savetz

Psst! Hey, buddy. You wanna buy a domain name? Cheap?

It doesn't take a sleazy back-alley deal to get a domain name for your Web site. In fact, thousands of domain names are offered via that upstanding institution, the online auction.

State Your Name

For the benefit of any recently converted Luddites, a domain name is a unique alpha-numeric name that's used to identify a particular computer (i.e., Web server or mail server) on the Internet. In other words, it's the part of the email address that comes after the @ sign, and the part of a Web address that follows "www"--for example, and You'll need one if you plan to run a Web site of your own.

In essence, you'll have a choice of either registering your domain name with a traditional domain name registrar, such as Network Solutions or, or going the online auction route and placing a bid on sites such as eBay and Yahoo Auctions. You also can use domain name-specific auction sites, such as or In addition, you can search for domain name auctions by using AW's own Stores Search.

What You'll Get

Many domain names that are for sale have never been used for a Web site; they're just names that might be (the seller hopes) useful to someone, either a business or individual. Occasionally, you'll find domains for sale that have been online with Web sites: They might already have traffic and notoriety--for better or worse. (For example, not long ago the owners of, a clearinghouse for information about the Y2K bug, offered the domain on eBay.) In some cases, the sale might be for an entire Web site, content and all. Or, the seller might be offering the name only--be sure you understand exactly what is for sale.

How Much?

What can you expect to pay for a domain name? It depends entirely on the quality of the name. Simple, short, descriptive domain names, such as and, have sold for hundreds of thousands of dollars...or more. (A more startling and atypical example: sold for $7.5 million late last year.) On the other hand, not-so-memorable names might go for a couple hundred bucks or less. When an established Web site is for sale along with its domain name, a buyer can expect to pay significantly more.

In the case of most domain name registrars, all you need to do in order to purchase a name is supply your personal information and credit card information. Moreover, there are costs associated with the purchase of a domain name beyond the registration price. Here's how it works with Network Solutions, the most popular domain registration service. Although there is no fee for transferring a domain name to a new owner, the domain name registration must be in paid status--if it isn't, someone will have to pay $35 to renew it for a year. If the normal three- to six-week processing time to transfer ownership isn't fast enough, priority two-day processing is available for $199. In addition, the seller will need to invoke the service of a Notary Public, which can cost a few dollars more. Typically, the buyer pays for these incidental costs--a smart seller will indicate the terms in the listing. If the terms aren't clear, ask the seller before making any commitments.

It costs $35 to register a new domain name with Network Solutions. Use the WHOIS lookup tool to find out whether the one you want is taken. Of course, if you choose to obtain a domain name via online auction, the amount you'll pay will vary greatly. Just be sure to take the usual precautions (checking the seller's feedback, sending emails with any questions you have, and so on) and remember that in all likelihood you still will have to pay renewal fees in the future--buying a domain name is not a one-time purchase.

Going the Distance

Thinking about buying a domain name and auctioning it off for a quick profit? Well, the sad fact remains that a lot of the good domain names (and many of the not-so-obvious ones, and a whole lot of the stupid ones, too) were snatched up long ago. Just check the completed auctions in eBay's domain name category and you'll see for yourself--hundreds of domain name auctions end without a single bid. And even if some of the domain names have potential, the sellers often demand excruciatingly high opening bids. You'll also come across some names that are simply lame, while others are trademark infringement lawsuits just waiting to happen. As always, caveat bidder.

But the domain name landscape soon will be changing as the Internet Corporation for Assigned Names and Numbers (ICANN), the organization charged with managing the infrastructure for Internet addresses, eventually introduces new top-level domain names and new suffixes (".shop" and ".store" in addition to the current ".com," ".org," and ".net"). Some domain name experts believe this will dilute the value of the dot-com name, while others say it will create a larger and more robust domain name market.

Regardless of what happens in the future, online auction sellers who are looking to further establish themselves with a more formal online presence should seriously consider obtaining their own domain name and Web site in addition to having About Me-style pages and the like. It's not only a great branding opportunity that increases your credibility and visibility, but it also give buyers a place where they can find out more about you, your merchandise, and your online auction biz.

Articles by Kevin Savetz