Sex.com Sold For $14M

[Beachie]

a million uniques a day, isn't that a bit overestimated?

Underestimated by far.

 

[Leading Names]

If I remember correctly it was receiving 200,000 uniques a day and making low - mid $$$$

- Rob

 

[RatherGood]

What?!?! That can't possibly be true??

I'd have dug up $15m for sex.com. Wasn't Kremen awarded $65m in damages (albeit it was never paid) for lost income over the four years that Cohen had it? That name is worth 3x that much. Dig deeper - there must be more to it..

Yes he was awarded damages, and Cohen was recently apprehended in Mexico. He will never see a penny from that judgement. Maybe he should have taken Verisign's offer of $6.

Exactly! That name pulls at least a million uniques a day. If 1% of people click a 10 cent ad, that's $365k a year..

By that math it would take almost 40 years break even with PPC. That makes the assumption that PPC in its current form will still exist (which it won't).

Not to mention one of the major complaints against the operation of sex.com was complaints from PPC buyers who bought worthless traffic.

If half a percent do a $15 signup that's $27 million a year. Something doesn't add up here.

Ironically, with online porn being speculated as 25% of all internet searches and at least 10% of all online traffic no one ever thought to turn it into a paysite.

 

[Beachie]

By that math it would take almost 40 years break even with PPC. That makes the assumption that PPC in its current form will still exist (which it won't).

I know - I was just illustrating that, bare minimum, it earns more than the interest on $8million.. If they can't monetize a name like that to make a million a year there's something wrong. I know people running free game sites that make half a million a year.

 

[JMJ]

I can see it as an easy million a month site with live cams. Lets say it does only get 200k a day. If 5% of those signup for a monthly membership of $20 a month as a cam site. Thats $200,000 a day in signups. Pay out 50% to those displaying the goods and you're still breaking three million a month. But if they were smart they would turn it into a monthly fee adult cammunity and they wouldn't have to pay anyone to be on cam.. I couldn't even begin to imagine what it would do at an hourly rate.

 

[Beachie]

If I remember correctly it was receiving 200,000 uniques a day and making low - mid $$$$

- Rob

Hi Rob,

I think he'd make more than that just running paid banner rotations on 200k uniques.

 

[Anthony Ng]

sex.com is too good for those stupid parking or even paid membership adult thingy.

 

[Leading Names]

Hi Rob,

I think he'd make more than that just running paid banner rotations on 200k uniques.

The figures I quoted are a year or two old so from a revenue standpoint things may have changed considerably.

As a PPC engine I doubt the site was making that much, $2-5k daily still seems very realistic to me.

$2-5k daily = $60,000 - $150,000 per month.

- Rob

 

[Beachie]

The figures I quoted are a year or two old so from a revenue standpoint things may have changed considerably.

As a PPC engine I doubt the site was making that much, $2-5k daily still seems very realistic to me.

$2-5k daily = $60,000 - $150,000 per month.

- Rob

Yep. I guess we can't be sure. I remember reading that they had a huge amount of trouble tracking the traffic. Most of the traffic analysis software couldn't cope. If we meet in the middle and say $3500 a day, that's still a healthy $1,200,000 a year just from brainless PPC.

 

[Edwin]

According to the press release at the time the case was settled, it gets 150,000-200,000 uniques a day:
http://blog.ziffdavis.com/seltzer/archive/2004/04/20/535.aspx

[Generally - not always, but usually - companies will if anything inflate the stats in a press release, just like people exaggerate a bit on their resume]

If it's making $1,200,000 a year then that's 11.66 years revenue, which looks very healthy compared to e.g. the Marchex transaction. And would you REALLY want to bet that PPC is going to be around 12 years from now when confronted with the option to accept - or turn down - $14,000,000.00 ?

Incidentally, the numbers look better than that (for the seller) since at the same 4% interest rate $14 million becomes $22 million in 12 years' time so there would still be a LONG way to go before the total PPC income caught up with the ever-increasing lump sum value of today's $14 million compounding annually.

 

[pigman]

Such a great purchase.

 

[RatherGood]

I know - I was just illustrating that, bare minimum, it earns more than the interest on $8million.. If they can't monetize a name like that to make a million a year there's something wrong. I know people running free game sites that make half a million a year.

I think that was the main problem. Owner had no idea how to monetize it to the fullest extent possible. Kind of ironic since he had to fight so hard to get it back (and set some very good legal prescedents for all domain owners in the process).


3 big factors for the sale:

-No interest in developing the domain into a real website (ie, the owner is not an "end user" as they are referred to here).

-The average person, who wasn't born into wealth would take a $14M domain offer and run. Especially after realizing something that valueable can be stolen for years on end.

-Timing. Like the person that wanted $500,000 for election2004.com learned, timing is everything. Sex.com will be worthless if .XXX comes to pass. Just like how election2004.com is worthless in 2006.


Either the buyer knows .XXX is going to be shelved or the seller knows .XXX is going to be approved. If neither knows than god help them both.

 

[JMJ]

Even if .xxx does get approved and becomes mandatory sex.com will just be forwarded to sex.xxx. If you think the adult industry will pack up their stuff move over to .xxx and drop everything they have built you're fooling yourself.

 

[pigman]

Sex.com will never get worthless, .xxx wont decrease the value at all.

 

[denny007]

sex.com is too good for those stupid parking or even paid membership adult thingy.

Totally agree. Real sales and services must be built on this domain. DVD sale/rent, VOD, download, galleries, sex help, sex pharmacy and so on, and so on.... After developped in a real company, it can make a lot of millions... Porn industry is what - like 10 billion year ?

 

[RatherGood]

Even if .xxx does get approved and becomes mandatory sex.com will just be forwarded to sex.xxx. If you think the adult industry will pack up their stuff move over to .xxx and drop everything they have built you're fooling yourself.

Thats like spending 14 million dollars buying an office building in a downtown location and saying its a great idea because if the building gets condemned and is declared uninhabitable you can still use the parking lot.

I don't think sex.xxx has 8 figures worth of branding potential alone. The hypothetical name is redundant if anything.

If it gets to the point where porn actually is legislated off of .COM to .XXX the very first thing spammers and other marketers will start doing is using .COMs and other TLDs to get through .XXX filters.

You can bet your ass .COMs won't be forwarding to .XXX for very long, if at all.

 

[JMJ]

In your senario .xxx will never even make it off the ground. There's too much money involved. The very moment ANY government trys to make the adult industry reinvent itself on a different extension would be tied up in court for so long it rediculous.

My local Gov tried to pretty much eliminate the strip clubs here in town. They have been tied up in court for like 8 years over it. Finally the clubs dropped their suit and guess what? The law is being repealed and the clubs now get the added bonus of selling liquor. Why is this? Well, a councelman who has half a brain and doesn't have one foot in the grave made the public understand that to keep the hundreds of millions of dollars in convention money coming in we have to have the clubs. It's one of the top factors in convention planning. Like it or not.

 

[pigman]

"If it gets to the point where porn actually is legislated off of .COM to .XXX"

That will never happen.

 

[uglypeoople.com]

which would you buy?

sex.com for 14M or myspace.com for $580M

i would buy sex.com for 14m and easily sell it for over $100m

 

[gemsergio]

the unizques are probabbly around 500 600K and yes the buyer had a steal big time the domain is wort around 20 to 30 mil USD easy considering the revenue even more considering the brandability of the name