Investing in Domains

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With markets all over the place, the general public are increasingly becoming interested in domain name investments .  I mean why wouldn’t them consider domain investing, with the stock market jumping all over the place, and uncertainty everywhere? .  In fact domain investments have gone under the radar for most people the last 10 years, even though over the last five years the domain name market averages an 80% yearly increase in value .Without a doubt these are great investments.

In the last 2 years alone the average LLL.com (L=”letter”) such as CAH.com has gone from $1500 in 2004 all the way to $8000 in 2009 .  Thats an amazing increase in value .  Domains with country code extensions such as .us, .de, .in, .me, and .tv are even showing huge gains in prices .  Even if this is the case, the .com domains will always, in my opinion, be the granddaddy of them all .  When anyone in the world thinks of a website they immediately think of .com .  This is why I believe that as the other domain extentions grow, such as .tv, .me, .net, .org, .co.uk, etc, the .com’s will even become more valuable  .  If a domain suchas MoneyMakerGroup.in starts getting traffic, it is only instinctive that a large deal of people looking for Moneymakergroup.in will type in http://www.Moneymakergroup.com instead.  Why?  Simply because, the vast majority of internet users associate “.com” with websites since the largest sites such as Google, Yahoo, MSN, etc all use this extension

What does this mean for the future of the .com domain industry ? 

It is my opinion, that .com domains will always warrent a premium over nearly every other extension, even the multiple keyword domaisn like HomeMortgageBank, etc .  There are 6 billion people in the world, and only a limited number of possibile .com domains out there.   Because of the possibilities to use 2 and 3 letter .coms as initials for large companies, they will continue to amass attention in the marketplace .  4 character .coms will also increase at a faster pace then the rest of the market .  I personally like the “Number followed by a 3 letter word or abreviation” .com domain names.  An example would be 4her.com.  These are easy to remember, yet there are literally hundreds, or even thousands of these left to be purchased .  Everyone quickly went after the LLLL.coms while avoiding the NLLL.com’s. 

Overall opinion of the domain market :

Although we can’t continue to have 80% yearly gains in a limited market, eternally, I do feel that 50-60% gains for the next 5-7 years is a good bet .  There are only 1 billion people online as of today.  This is out of over 6 billion people worldwide.  Only a small fraction of these peopel own domain names. .  One day, it is not crazy to think, that at least 80% of the world will have some sort of internet connection, while a majority will want their own website.  This represents an amazing growth forecast in the domain arena. .

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