A few years back, I had the pleasure of networking with Nat Cohen, President of Telepathy, Inc., a web development and Internet branding company based in Washington, D.C. The company was founded in 1999 and since then has been associated with a hearty appetite for building – among others – a portfolio of generic domains and LLL .com’s.
In today’s short interview to Acro.net, Nat Cohen shares with the rest of us some interesting and valuable points that led his company to success through strategic acquisition of generics and LLL .com domains.
How did the idea of registering available LLL .com’s come to mind? When did that initial registration occur?
My first registrations occurred in 1998 from drops. All the decent LLL.com were registered even back then. The value in LLL.com seemed clear since they were so short, worked well as Internet addresses, and businesses love to use acronyms. There are hundreds if not thousands of worldwide uses for each acronym, so the supply/demand imbalance supported the value as well. It also didn’t require much mental effort to research them since they are a relatively small, defined group.
Do you invest in longer names, such as LLLL .com’s in a similar manner? Or other TLD’s in the LLL realm?
I have a handful of LLLL.com domains that I picked up cheaply a while back, but I’m not actively investing. The supply/demand balance is much poorer for LLLL.com, but I think there is still money to be made there. I am actively investing in LLL in other TLDs.
Do you think the .biz/.info/.us Registries should open the market to domains less than 3 characters? Is that something you’d invest into – 2 letter .biz/.info/.us domains?
I don’t see a reason for those registries not to offer 2 character registrations. I think 2-letter domains in those extensions would have value so I’d be a buyer at the right price.
What do you think of today’s aftermarket expansion, e.g. auction houses, registrars that perform auctions etc.
I think the development of a robust after market is very healthy for the industry. It has a down side because it is often harder to negotiate purchases with private owners since they want to expose their domains to the secondary market. But on the positive side it lowers the barriers to bringing domains to market so more domains are being made available for purchase than might otherwise. The aftermarket is a sign that the industry is maturing beyond its lone wolf origins. The aftermarket brings transparency to domain valuations and helps educate the public about the value of domain names.
What risks do you see ahead?
There will be an intensifying struggle over the control of the most valuable domains, and the rules that govern the rights to domain names. As domains become more critical to businesses, businesses will seek to control those assets in the most cost-effective way. Sometimes that means trying to seize domains rather than pay for them, or change the rules that govern domains to the business’ advantage. While I don’t know all the facts in the matter, the decision awarding myspace.co.uk, which predates the MySpace social networking site, to MySpace seems to be a blatant example of big business’s attempt to seize valuable domains.
Domain owners do not hold secure title to their domains. Registrants of dot-com domains and the other primary extensions have to agree to arbitration rules that can result in the loss of their domains. The arbitration rules are very loosely written, subject to wide variations in interpretations, and decided in an environment where allegations are often substituted for facts. The risk/reward ratio is heavily tilted in favor of the Complainant who merely risks some money and has no other downside, whereas the domain owner faces the risk of losing a potentially very valuable domain and the expense of defending any claim, no matter how frivolous.
Many domain owners have an aversion to politicking, lawyers, and lobbying. But the viability of domain ownership may depend on becoming active in these areas. Anyone making a living or seeking to make a living from domains should support the Internet Commerce Association. Domainers have been very fortunate and to protect our good fortune we need to become more engaged with ICANN, to donate domains to ICA fundraising efforts, and to contribute to legal defense funds.
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