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The Internet Businesses

Millions of Addresses, Thousands of Sites, One Business 97

Posted by Zonk from the tentacles-everywhere dept.
An anonymous reader writes "A New York Times piece looks at a rising power in the 'new internet bubble' that you may not have heard of before. The business, an outfit called NameMedia, has made a concerted effort to quietly purchase vast tracts of 'real estate' on the internet. The ultimate goal is to provide additional advertising and page views for content sites. 'Behind this suddenly active business category -- which includes companies like iREIT in Houston, Marchex in Seattle, and Demand Media in Santa Monica, Calif. -- is the recognition that not all Internet users turn to a search engine when they are confused about where to find something online. Rather, 5 percent to 10 percent of people will simply type in a name that sounds as if it might suit their needs. The so-called direct search or direct navigation approach is seldom fruitful for users, nor has it been particularly profitable for owners of the sites that they visit. An obscure Web address may have four or so visitors a month, and perhaps half will click on an ad.'"
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Millions of Addresses, Thousands of Sites, One Business More

Millions of Addresses, Thousands of Sites, One Business

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  • Uhmm.... (Score:5, Informative)

    by suv4x4 ( 956391 ) on Monday May 28, 2007 @06:19AM (#19298735)
    I think I speak of everyone, when I say: WTF

  • Click Through Rate (Score:5, Insightful)

    by klingens ( 147173 ) on Monday May 28, 2007 @06:20AM (#19298743)

    and perhaps half will click on an ad

    To which Devil did they sell their soul to get click through rates like that?

    • Re:Click Through Rate (Score:5, Funny)

      by suv4x4 ( 956391 ) on Monday May 28, 2007 @06:25AM (#19298771)

      "and perhaps half will click on an ad"

      To which Devil did they sell their soul to get click through rates like that?


      Google [google.com]

    • Re: (Score:3, Insightful)

      by Anonymous Coward
      You DO realise that these are the same people who navigate their way around the internet by typing the subject in the url bar and putting a www. on one side and .com on the other...
      • So? Who do you think will click on ads for cell phone range extender stickers, nascar, and creationist museums?

    • Its from the "87% of all statistics are made up" department.

      Same as this quote:

      Rather, 5 percent to 10 percent of people will simply type in a name that sounds as if it might suit their needs.

      More like 5% to 10% will do this once a month ... a far cry from 5% to 10% of web users.

      • methinks you are underestimating the people who think "teh intarweb is AOL" where the address bar has a dual function of URL entry or keyword entry. They think the whole internet is like that.

        -nB
    • You can get them, and legitimately.

      If your site has no content on it, but relevant ads all over the place, the odds are pretty good that the person who navigated to your site will click on an ad. I own a few of these sites, leftovers from projects I never wound up pursuing, and see clickthrough rates of 20-50% each day, depending on random chance.

      However, sites with no content get no positioning in search engines, so the problem is that you get maybe 3 hits a day and 1-2 clicks. Of course this is basicall
  • They really show Google ads on these pointless pages?
    If I did that my adsense account would be terminated.

    • Re:zlitch content (Score:5, Interesting)

      by suv4x4 ( 956391 ) on Monday May 28, 2007 @06:29AM (#19298789)
      They really show Google ads on these pointless pages?
      If I did that my adsense account would be terminated.

      Thing is, if you have one domain and host ads like that, it may be terminated. But if you have thousands of domains, Google will offer you Domain Parking services with AdWords on them. Yes, Google will spam the domains themselve.

      I suppose the reason don't allow you to use this service if you got 5-10 domains is that it keeps the word of mouth down. It's not something Google wants everyone to talk about.
      • Thank you for writing a summary that is understandeable. The summary didn't make any sense at all and also the slashdot tags have become pretty redundant (I didn't read slashdot for a few months, don't know the reason, but the way these tags are now they might as well just leave them out again), if they would have mentioned 'google ads' or whatever, the idea of the article would have been clearer. I could also have tried to read it of course, but with a summary like it was pretty hard to get interested.

    • Re:zlitch content (Score:5, Informative)

      by QuickFox ( 311231 ) on Monday May 28, 2007 @06:57AM (#19298903)

      They really show Google ads on these pointless pages?
      If I did that my adsense account would be terminated.
      On the contrary, Google encourages domain squatting [google.com].

  • Such an opportunity (Score:5, Funny)

    by mshurpik ( 198339 ) on Monday May 28, 2007 @06:22AM (#19298749)
    >An obscure Web address may have four or so visitors a month

    Dude, I need to invest in this.

  • its just like the 90's again (Score:1)

    by Anonymous Coward

    except this time its the fastest way to get infected with spyware/adware

  • Namespace clutter (Score:5, Interesting)

    by MichaelSmith ( 789609 ) on Monday May 28, 2007 @06:22AM (#19298753) Homepage Journal

    At the end of the day all of us pay for the clutter created by domain names which exist only to capture page views. Presently to put a domain on line you just need to pay for registration and hosting on two DNS servers. The distributed nature of DNS takes care of the rest.

    Should a way be found to make domain squatters pay the true cost of their collections?

    • Re:Namespace clutter (Score:5, Interesting)

      by Killshot ( 724273 ) on Monday May 28, 2007 @06:42AM (#19298855) Homepage
      I really dislike how frequently when searching for information on something I find nothing but pages and pages of google ads.

      I think that it may ultimately end up hurting google's business because people will get tired of searching for things and not finding it, and advertisers will get tired of paying for clicks that don't convert.

      Someone should make a search engine that does not index pages where most of the content is google ads.
    • It's our dependence on domain name services that causes this. We should all create our own local host files and trade them. Just like we have a local contact list for email and such. It would also possibly prevent unwanted re-directs, where even your service provider can take you where they want to you go. Even though it would be a real pain, all links in a web page should use an IP address instead of "www...". And if we can't have a fixed IP for ourselves, we should at try to get a month long lease of disu

    • Should a way be found to make domain squatters pay the true cost of their collections?

      Yes. Here's a suggestion I've read in the past. Charge $100/year for a domain. It's not outrageous if you own a few domains. But if you own 1.2 million, staying in business becomes a lot less profitable if you're a squatter.

      All you have to do is hold out for a couple of years with clownpenis.fart until these squatters run out of capital. Then you can buy obscure-website-4-me.com.

      Either that or it'll be a lot mor

  • Bah, scammers (Score:5, Insightful)

    by tomstdenis ( 446163 ) <tomstdenis.gmail@com> on Monday May 28, 2007 @06:22AM (#19298757) Homepage
    The only reason you buy thousands of domains is in the hopes that one of them becomes really popular and you can extort^Wscam^Wsell it to someone who will do something with it. I dunno about the rest of you, but when I google for hard to find products and I land on search engine bait websites, I just hit the back button, I don't click on the ads or worse, buy anything from them.

    Tom

    • Re: (Score:2)

      by rs79 ( 71822 )
      "The only reason you buy thousands of domains is in the hopes that one of them becomes really popular and you can extort^Wscam^Wsell it to someone who will do something with it. "

      Nope.

      Their domains cost $6. If they make anything over $6 per year they're happy, and most do, Multiply this by a large number.

      They don't typically sell domains. In the long term it's not in their interest.

      • Re: (Score:1, Interesting)

        by TehZorroness ( 1104427 )
        They will sell if you offer enough money. These corporations who lead the campaign of useless advertising sites and domain squatting are without a doubt *the* most disgusting crock of slime the internet has to suffer through. In the future, all the meaningful domains will be owned by a small few companies who have no interests in the betterment of the internet, and all legitimate sites will end up lucky if they can get their hands on domains like "dfklgjhh43.cx"

        Each corporate entity should only be allowe
        • Doesn't work, take a online game http://www.mystonline.com/ [mystonline.com] when the forums first went up a fan purchased http://www.mystlive.com/ [mystlive.com] you would be surprised at the number of people who thought this was an offical page by Cyan/Gametap. People will give importance to domain names and companies do need to protect the associated with themselves (the more global they are the more they need.)

          What we need is for ICANN to creates rules which state a domain name can't point to a place with more than 50% of the page d
          • What we need is for ICANN to creates rules which state a domain name can't point to a place with more than 50% of the page devoted to adverts.

            Pretty tough to define. What about a web page run by a "free classified ad paper" of the type that you pick up in gas stations. All they have is classified ads and some paid display ads. That's their product. What if they put up a web page with the content of the paper on it as well?

            Here [thebargainhunter.net] is a perfectly legitimate website of that nature, an

            • Pretty tough to define. What about a web page run by a "free classified ad paper" of the type that you pick up in gas stations. All they have is classified ads and some paid display ads. That's their product. What if they put up a web page with the content of the paper on it as well?

              There is a clear difference in these two cases. Craig's List, or The Want Advertiser, are for personal advertising while the other type of site is for commercial advertising. One offers a useful service, while the other is a scam. Something in our mind allows us to easily discern the two types of sites from eachother.

              • Craig's List, or The Want Advertiser, are for personal advertising while the other type of site is for commercial advertising.
                There are plenty of "business-to-business" portals out there as well, where various commmercial businesses advertise their services to other commercial businesses. For example, if I needed to contract a municipal sewer service outfit, I would likely hit one of those sites to find out who's providing that service in my district. Most people won't care and would find a site like th
        • These "domainers" can make a profit just from the advertising - being able to resell the domain name is just a bonus, and in many cases they're selling them to other domainers rather than legitimate content providers, sometimes for a lot of money.

          ICANN's "domain tasting" policy really aggravates the problem - if you make a "mistake" registering a domain, they'll give your money back if you return the domain name within something like five days, even if the mistake was "didn't get enough random hits to make

    • You are wrong (Score:3, Interesting)

      by Shohat ( 959481 )
      You are wrong in your first assumption - the domains are bought from an already popular niche. This isn't gambling or cybersquatting
      And regarding clicking - you probably assume that others do as you do - But this isn't true - these sites enjoy around a 15% CTR, and actually it creates a win-win situation. The users, instead of getting a name error (useless), click an advertisement which is often relevant to their initial request, the target site gets a visitor (which is targeted due to the initial related
      • It's true that for the small group of people navigating the internet by URL instead of search engines these sites may very well get them where they want to be. I believe the issue most people have with them is when these pages rise up in the search engine results, pushing content sites onto the second or third page of results.

        • Re: (Score:1)

          by Shohat ( 959481 )
          Usually they don't, for a simple reason - SE results in google a result of incoming links. It is impossible to effectively promote 10,000-60,000 sites in order to get decent SE placement within the first three pages, specially for niches popular enough to generate type-in traffic.

      • ...actually it creates a win-win situation. The users, instead of getting a name error (useless), click an advertisement...

        Actually, I'd call this a win-win-win situation. Not only do people profit off of the idiotic, but, much like spam, this actually takes money out of the hands of idiots. It's kind of like developing a money-eating virus that only targets stupid people. This could, somehow, over time, reduce the number of idiots in the world. Although I feel that the Jerry Falwell method is more effective, I commend you in your selfless efforts.

        • Re: (Score:1)

          by Shohat ( 959481 )
          It doesn't take money from hands of idiots - the users reach sites that advertise via google, not spam. The only side that pays in this trasaction are the advertising businesses.
          • Right, but I'm assuming that the advertisers pay because the idiots usually buy stuff from them after they click on those links.

            • Re: (Score:1)

              by Shohat ( 959481 )
              You never shop online ? Because if you don't, people that do shop online probably look as strange to you as you to them. All big retailers advertise via Google's platform...

      • Re: (Score:2)

        by morcego ( 260031 )
        Humm, didn't verisign have something like this in place for a few days, before ICANN made them stop ?
        I forgot how it was called, thankfully.
        Is that what you are advocating ?

      • Re: (Score:1)

        by maxume ( 22995 )
        It's only win-win as long as the target site feels that they are paying a low enough amount per well targeted visitor.

        Google has to walk the fine line that maximizes their revenue and minimizes the appearance of shenanigans. These sites explore that line in detail, as windbags like myself will notice the association between the advertiser and the internet noise, and appreciate it in a negative way.
      • When I get less lazy I intend to just block out all of the IPs that lead to those types of sites. I sincerely hope that Google does get serious, because clicking on a site only to get ads and links to sites which may or may not be legit. Really annoys me.And it isn't just the wasted bandwidth, or the attempts to get rich using somebody else's trademark, but just the fact that it now takes some of my time to sort through these garbage listings to hopefully find something that is useful.

        I don't really think t
      • The majority of these sites that I see are not at all targeted, unless for some strange reason someone's decided I have a fondness for gambling and herbal Viagra.

        For example here's a site I used to own:

        http://wonderfulwomen.com/ [wonderfulwomen.com]

        Wonderful women was original a directory of what I thought were cool pages created by women. Unfortunately I didn't have time to maintain it and let the domain expire.

        So click on wonderfulwomen.com today and what do you see? Roommate searches, apartment searches and "popular catego
      • On the other hand, if these scummy sites didn't exist, users would quickly learn that typing random crap into the address bar is not the way to find a place, that you do that by using a search engine.
  • Well not intentionally but accidentally when i mistype a web address i do get directed to extremely pesky web pages which offer me hundreds of alternatives to what i type.

    It may be a source of information but to me it is more of a frustration.

    Eventually many times i figure out the best way is - Google it.

    Whatever the case may be, these sites are sometimes set on Windows machines over cafes as default pages to attract customers.

    Business indeed, just IMO spamming in a more holistic way.

  • Rather, 5 percent to 10 percent of people will simply type in a name that sounds as if it might suit their needs.

    What to do with such Lusers, they might become the reason for a call for an Internet Users Licence.

    This could mean more than 5 - 10% of visitors to a(ny) site are lost souls as these idiots would need many attempts to get to their goal...

  • Nice business model... (Score:5, Informative)

    by Simon ( 815 ) <simon@nOSPam.simonzone.com> on Monday May 28, 2007 @06:51AM (#19298879) Homepage
    ...it would be a shame if anything were to happened to it. [nypost.com]

    --
    Simon

  • ob. Monty Python quote (Score:3, Funny)

    by name*censored* ( 884880 ) on Monday May 28, 2007 @06:52AM (#19298889)
    >>vast tracts of real estate

    What's not to like about 'er? She has 'uuge.. TRACTS of land!
  • So now this kind of domain squatting has become respectable? Yeah right.
  • ...wasn't this up last week?

    http://it.slashdot.org/article.pl?sid=07/05/23/222 0202 [slashdot.org]

    aM

  • A bit hopefull (Score:2, Informative)

    by mcfedr ( 1081629 )

    and perhaps half will click on an ad.
    no no no...perhaps none of them will click an ad...not only do i know i have never clicked on an ad, nor have most people i know, i have also tried putting ad's on websites with not many visiters, you never get hits

  • Niche site, for sure (Score:5, Funny)

    by PuddleBoy ( 544111 ) on Monday May 28, 2007 @08:02AM (#19299175)
    NameMedia recently finished building technology where visitors to niche sites -- say, one on 1957 Mustangs -- will be presented with links to other sites with similar images.

    Yes, I'd have to say that the number of people who want to talk about 1957 Mustangs constitute a "niche".

    • Re: (Score:1)

      by sasdrtx ( 914842 )
      Hmmm... but possibly a lucrative one. You gotta figure that people who'd be interested in a 1957 Mustang would be up for helping transfer money out of Nigeria, and certainly for making little Johnny's last wish come true.

    • Re: (Score:1)

      by BACPro ( 206388 )
      That would have to be a P51 Mustang

  • What about "The Man Who Owns the Internet"? (Score:5, Insightful)

    by 1u3hr ( 530656 ) on Monday May 28, 2007 @08:29AM (#19299333)
    From this TFA:

    What weve wanted to do, quietly, is amass the largest real estate position on the Internet, which we feel we have, Mr. Conlin said.
    A week ago we had the story of a similar scumbag, Kevin Ham [slashdot.org]. from that FA at CNN Money:

    The man at the top of this little-known hierarchy is Kevin Ham -- one of a handful of major-league "domainers" in the world and arguably the shrewdest and most ambitious of the lot.
    So they're both the biggest. Journalisic exaggeration aside, it's disturbing that these parasites are celebrated by respectable financial reporters. These assholes are filling up the web with automatically generated pseudo-content, polluting search results to the point of uselessness. They're web-spammers with the same line of justification that email spammers used to use, they're "offering products that people might be interested in". A pest on both of them.
    • I also read the article about Kevin Ham. The funniest part was how deeply religious Kevin Ham is. He apparently got his start working on a web page for his church.
  • They should also include malware along with the google ads on these spam domains.

    You see, the malware will break windows, but that's ok because it will create work for anti-virus writers, who in turn will have more money to spend on bread in the bakers. The baker will buy shoes benefiting the cobbler.

    Everyone in society therefore benefits from domain squatting scumbags.

    Adblock http://.googlesyndication.com/* [googlesyndication.com]
  • I just experienced a recruiting attempt for iREIT in Houston; I thought it was for a hosting company (FreeBSD + Windows or Linux), but the career consultant must have read even further down into the job req as I kept asking questions and divulged the company name acronym: internet Real Estate Investment Trust. As it slowly dawned on me that I might be looking at the dubious opportunity to work for a cybersquatter (see below), I just went for details. Apparently their model is to gather tons of unclaimed dom

    • Re: (Score:1)

      by kc-guy ( 1108521 )
      I had a similar experience during my employment for a few shady companies in Utah (which as a Mormon, I am becoming quite ashamed of how many scams are based out of the state.)

      A company who wrote poorly written content articles on topics (real estate) and sold adspace for those articles with the vague insinuation that the articles would rank "highly" on Google/Yahoo in turn driving click-through traffic to the sponsor. Nice concept, but it didn't work, and they knew it. The company wasn't too far removed th

  • One of the things we do with SiteTruth [sitetruth.com] is filter out sites like this.

    SiteTruth is looking for the name and address of the business behind any web site that's selling something. If we can't find a name and address in a place most users would look, it's an illegal business (see California B&P code section 17538 [sitetruth.com], European Directive on Electronic Commerce [sitetruth.com], etc.) So they get a rating - a big red circle with a bar through it. And they go to the bottom of the search rankings.

    If they do give a name and

    • Re: (Score:2)

      by radtea ( 464814 )
      One of the things we do with SiteTruth is filter out sites like this.

      Unfortunately, it seems to filter out a lot of other businesses as well. My own company's site, which is registered to a perfectly legitimate nationally incorporated Canadian corporation that I own is rated as problematic. Several other small companies I am personally familiar with are given similar ratings.

      Many web businesses do not list a mailing address on their site--I don't because I operate out of my home and have no interest in pu

      • Re: (Score:2)

        by Animats ( 122034 )

        Many web businesses do not list a mailing address on their site.

        Yes. And SiteTruth downgrades their rating accordingly. That's by intent. We're in California, and apply California law on Internet businesses: [ca.gov] "Before accepting any payment or processing any debit or credit charge or funds transfer, the vendor shall disclose to the buyer in writing or by electronic means of communication, such as e-mail or an on-screen notice, the vendor's return and refund policy, the legal name under which the busine

        • Re: (Score:2)

          by radtea ( 464814 )
          "Before accepting any payment or processing any debit or credit charge or funds transfer, the vendor shall disclose to the buyer in writing or by electronic means of communication, such as e-mail or an on-screen notice, the vendor's return and refund policy, the legal name under which the business is conducted and, except as provided in paragraph (3) [about registered post office boxes], the complete street address from which the business is actually conducted.

          And indeed, my business conforms to this law.
  • This is a business model which is designed to look good on paper, and appeal to investors. After that, it doesn't look so hot. Here's why:

    First off, they call addresses like "DailyHoroscope.com" the top-tier equivalent of "Oceanfront Real Estate", by which I suppose they mean "oceanfront" as in Haiti -- because last time I checked, 14 letter domain names were about as hip as AOL email addresses.

    Secondly -- the number of URL's is completely irrelevant. 750,000? I could generate 750,000 all numeric (or r

    • If you want to see the details of that business model, read the 10-K filing of Marchex [sec.gov], the publicly traded domain farmer.

      Some highlights:

      • "Our proprietary network is comprised of more than 200,000 Web sites."
      • We deliver pay-per-click advertising listings that are reflective of our merchant advertisers' products and services to online users in response to their keyword search queries, and in response to their typing of specific Web Sites into their browser (direct navigation). These pay-per-click list

      • It's not a very profitable business [. . .] They have substantial revenue ($127 million), but their operating costs and compensation eat up almost all of that.

        Profitable for whom? I wouldn't invest in such a stock, but a glance through their proxy statement indicates that their CEO was paid salary of $50,000 (which he wanted held at that "historical" rate). Two other members of the board were paid $135,000 and $95,000, respectively. The salaries for those two executives for next year were raised to $25

    • Re: (Score:2)

      by dmehus ( 630907 )
      Actually, Name Development Ltd. was rumoured to be highly profitable pre-buyout by Marchex several years ago. (Interestingly, Name Development was a pioneer in "direct navigation and monetization" with its infamous Ultimate Search-branded parking pages with the yellow and blue layout and cute little googly-eyed computer monitor creature as a logo on all parked domains' placeholder pages.) They were rumoured to be doing something like $20 million in annual revenues with $17 million in net income, with less t
  • I am absolutely irate about this.

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