The domain industry needs a whole lot more transparency

While everyone is awaiting the next wave of the Nelson “Halvarez” Brady tsunami to hit the domain shores, the lingering question is obvious: will there be more transparency in the future?

Oversee is currently rushing to wrap up the Snapnames shill bidding scandal in a manner that does not instill confidence. The forensics company that was hired by Oversee to investigate the scandal is most likely driving the specifics of the “rebate” that was announced. However, this is clearly a method by Oversee to minimize any collateral damage, while giving the impression that the Augean stables would be clean.

But is this the case?

Snapnames has removed and currently does not provide access to crucial historical data older than 2 years, related to the exchange of bids per auction performed. The ousted former employee, Nelson Brady – a VP of Engineering no less – was allegedly driving a shill bidding process under the handle of “halvarez”, participating in thousands of auctions over the course of several years.

Transparency is a key element here, and Oversee does not seem to fully understand that they are not exactly doing what they should be doing: reassuring the Snapnames customers that their losses will be compensated, by providing access to historical data that is currently unavailable.

Due diligence must be performed independently by each person that has a reason to challenge the upcoming outcome of the forensics company’s research.

This is the first major wave that paints the domain industry in a rather unflattering light; it’s the first of several that – unless transparency is established – will severely hammer the domain coast. Because currently, there is no transparency in the PPC sector; there is no transparency in the drop-catching business and there is no transparency in the way domains are handled, transferred, secured and resold.

So while many – myself included – got upset with the TechCrunch article which called the domain industry “dirty”, perhaps that will be a stepping stone in order to begin the process of instilling transparency in every aspect of this Wild West called “domaining”.


  1. Well said, Theo.

    2009 has been my first year in the depths of the domain industry and the overall secrecy, including both companies and domainers, is shocking. Domaining has been a way for me to fill my time, learn a new industry, and apply my business background in an all new way whilst unemployed, but some of the dirt that gets flung around does not encourage me.

    Many successful domainers are quick to harp on newbies, yet will not openly share their methods for success. I realize that this is a business and there is competition, but others like yourself, Chef Patrick, Bruce Marler, senior forum members and others share your successes and help guide motivated newbies like myself.

    The TechCrunch article was an eye-opener for me. While many of the comments were extremely frustrating, some of them offered fantastic outsider views of what we, as an industry, represent. I am going to take some of these comments to heart and change my approach as I move forward in the world of domaining.

    The SnapNames shill bidding is surely not the only one in the industry, but hopefully it does encourage others to clean up their act.

  2. Its all bull shit. The guys at the bottom are the ones getting screwed. Anyone that does not have the name Rick Schwartz, Rick Latona, Frank Shilling, Kevin Ham, Oversee, Ron Jackson, DomainTools, Godaddy, any auction house, or anyone that has boat loads of money is on the bottom. I dont care how many low $x,xxx sales you have, you do not have any position to sway the industry at all.

    If you historically look at the ‘prominent’ domain bloggers out there most of they success comes directly from their blogs themselves or through development of a sub-par keyword domain name, not entirely on the domain name itself.

    The amount of money these people at the top are making is ridiculous and only bits a pieces dibble down to the rest of the pyramid. The key in the industry is to see transparency on all levels and not just the low end. The reason i say not just the low is because the low end is skewed by what people are doing with they domains to make them more valuable not just the domain itself.

    The sad thing is that you will not see these people and companies become transparent because there is no need for them to. No matter what the industry looks like to the rest of the world it will not matter because they hold the domain names that matter.

    The post Rick Schwartz has been posting the past couple of days should set off how small anyone making lower end sales in the industry looks. The reason is because those big players are the only that hold what matters and the only way to make it to that point is buy your way in.

    Good luck to the industry, domaining is peanuts diversify your portfolio, and no i do not mean with domains but other income streams. You can make much much more off of other methods without so much to invest.

  3. Has anyone reported this to the FBI yet?

    Maybe everyone should to bring it some attention.

  4. It’s obvious that the incident is on-going, there will be announcements from various industry pillars in the coming days.

    Ross, I know what you’re saying; essentially the people in the industry that make the big bucks have no intention to set a clean set of rules so that everyone plays fair. It’s a dog-eat-dog world out there and we’ve just found out what the rebate bone is all about.

  5. Ross, I had to reread your post to make sure I understood the tone correctly. Apart from the companies (The companies are a different story), are you saying the individuals you listed above are responsible for changing the industry simply because they have money or have become successful in domaining?

    I have witnessed many of these individuals throughout the years make contributions either in time, money or knowledge to the domain industry. To hold them responsible for what happens to our industry is irrelevant.

    Like any other industry or business, one can either sink or swim by themselves or choose to partner / network with others along the way. To imply that our domain seniors are shutting doors for the “little guys” or hording success is not only inaccurate but irrelevant and unfair.

  6. “Many successful domainers are quick to harp on newbies, yet will not openly share their methods for success. I realize that this is a business and there is competition, but others like yourself, Chef Patrick, Bruce Marler, senior forum members and others share your successes and help guide motivated newbies like myself.”

    Cole, you hit the nail on the head. Some share. Some don’t. The people who do share do not necessarily share everything. People who expect things should be handed to them in this manner really hit a nerve with me (and others). These are things we all had to fight tooth and nail for, a lot through simple experience. At the end of the day, we are still in a business and we are all competing with each other.

    If people still get frustrated: crack open a book, do a google search, get that mouse moving. Because all the information is out on the open internet. And take the time to thank the people who do lend their knowledge in a blog.

  7. Actually, there is preferential treatment in every industry towards the “big” personalities.

    The “celebrities” of the domain industry can leverage much more than the average Joe Domainer; the names listed by Ross – while not indicative of actual events – were a good example of known “big” domainers that would be able to both get preferential treatment with service providers and to also keep a stronghold onto their current assets, achievements and relationships – outweighing much smaller portfolio holders.

  8. You’re right, Theo. That’s any industry. Who wants to shell out $xx,xxx or increase a company’s revenue and not get premiere treatment? Bigger risk = bigger reward. There is nothing unusual about that. I just think it is irrelevant to blame someone for having the ability to be in that position.

  9. Want to change it? Anyone can by shelling out the bigger risk. It’s that simple.

  10. I think you’re simplifying a given status quo because certain names were mentioned 😉

    There’s nothing unusual about regarding Frank Schilling, Rick Schwartz and Dr. Kevin Ham (known as “the man who owns the Internet”) as “big” players in the domain industry.

    Unfortunately, it’s not as simple as taking a bigger risk; one would have to invest mid six figures to leapfrog into the big boys club and get preferential treatment.

  11. Look at it this way: if you owned with all that traffic, what kind of deal would you want to make with someone with that kind of leverage? If you owned, what type of leverage would you expect to have?

    “Taking a bigger risk”, I didn’t necessarily mean with cash. Domains, traffic, any other related asset can be brought forth as a risk.

    Ross was implying that the bigger names not only could ‘sway the industry’ but that they should.

    I don’t think it is their total responsibility is what I am trying to say.

  12. Although I won’t speak for Ross indirectly, he said that the less prominent domainers have no power to sway the industry, while big domainers often act as if they are elected representatives of an entire industry.

    Look at it this way: when you elect representatives and give them power, you expect them to provide you with coverage in times of duress.

    Since the domaining industry has self-elected officers, Joe Domainer eventually realizes these principals up there work for their own interest only. And that’s the sad but honest truth.

  13. @Tia

    I was simply saying that there is no reason for the big names in the industry, a company or not, to disclose any sort of facts to the rest of us. We know there are deals between these big players and we know they own a large portion of names that really matter. I was merely using the names in question as an example.

    As Theo has mentioned about the only way to roll with the big boys would be to shell out the big bucks to get in the club.

    The rest of us are left to scrap for pieces and develop what we can and build value in to what we own. Is this a bad thing? No i do not think so but there are other methods than just simply building a mini-site that can maximize what you invest your time and money on. This is essentially what people in the industry are stuck on unfortunately.

  14. ’Look at it this way: when you elect representatives and give them power, you expect them to provide you with coverage in times of duress.’

    And they do, don’t they?

    Let’s not mix elected officials with self-made business people, Theo [πώς είσαι, καλά? καιρό έχουμε νά τά πούμε]. If big domain investors are acting as representatives of the industry as you say, it’s probably because the industry is indirectly asking them to act in that way.

    Either way, Ross, if you have the golden egg, everyone is willing to listen and offer you the better deals. What would be wrong with that?

  15. @Yanni

    I am not saying anything is wrong with being on top. I am just trying to say that the people on top have all the power and just dont give a shit about anyone on the bottom. In reality who are the people at the top doing business with? Each other! This is why you will hardly see any transparency coming from above unless it benefits them directly.

  16. “just dont give a shit about anyone on the bottom.”

    I would have to totally disagree on that one, too. I do not want to pick but I have seen plenty and experienced enough to tell you, you are wrong. 🙂 And we can agree to disagree.

  17. @Tia

    Please provide an example of the top giving two shits about anyone down here ;).

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