For Sale The End Of Dropcatching As We Know It

[.com.net.org]

Originally posted by DNMole


I humbly disagree.

BD, just like the normal joe blow reseller, wants names as cheaply as possible.

Looking at their rate of acquistion vs the rate of end user sales that BD used to list on their email updates, it would appear that probably 95%+ of drop acquired names never see the light of a sale beyond the cold-storage facilities.

I agree with your Mole.
I'm ready to rescue many in 95%+. :-D

 

[DomainGoon]

The only good thing about WLS starting will be that the pro-WLS people will finally find out that the anti-WLS people were right all along.

 

[Nexus]

Originally posted by DomainGoon
The only good thing about WLS starting will be that the pro-WLS people will finally find out that the anti-WLS people were right all along.

With smart people on both sides, I'd change that to: "The only good thing about WLS starting will be that the some people will adapt and keep doing business, while many others will finally be shown that they need to find another hobby." Were "pro-WLS" people to be proven wrong (or "right" for that matter), they'd all have to have the same opinion, outlook, and weather forecast.

~ Nexus

 

[mole]

The drop game as we know it is not cheap anymore. Everyone with a chance of getting a name has an auction going. So between the devil and the deep blue sea ...

 

[HOMEY1234]

In the land of the blind, the one eyed man is truly king...

 

[mole]

Originally posted by HOMEY1234
In the land of the blind, the one eyed man is truly king...

Depends which way you are looking :laugh:

 

[Nexus]

Originally posted by WebCat
Let's do a little math.........

Let's! I invite anyone to think over what I'm about to say about "the math" so many seem to expose about WLS' ominous portent. This is me saying my bit on the long standing "myth" about the coming WLS apocalypse. It's long, basically because I don't have time to chop it down. You can skim it for highlights if you want.

Originally posted by WebCat
Today, BuyDomains pays 15,000 for ONE domain.
After WLS, that same 15,000 will buy 385 Domains!
Multiply that by 1000 or 10,000, and POOF! There go ALL the domains with any value! Game OVER!

They will buy HUNDREDS of THOUSANDS of the WLS subscriptions, leaving you and I to lick up the little crumbs that Ultsearch, Buydomains, and the big money players have zero interest in.

They will always NEED to be the FIRST in line, regardless of how much money they spend. If the understanding is that BuyDomains (or whoever) will simply place a WLS subscription on every name that expires in under 6 months, then I'm afraid the MATH says that they will need to have an exponentially WIDER SPREAD than they have ever had to have in the past. This means much much more money than they've ever spent, much of it being flushed down the toilet.

Think about it this way... TODAY, if BuyDomains wants a name, they can wait until the name is in REDEMPTION PERIOD before looking into it. The drop is almost assured. Further, they can determine their picks days in advance, and put their high bids in to lock things up. With WLS, the entire dynamic changes. Instead of being concerned with the hard logic of REDEMPTION and/or PENDINGDELETE status... suddenly, they need to place subs on names that may never EVER drop.

For every ONE $15,000 bid under the current system, they may well need to place subs on hundreds if not thousands of names. When people look at the numbers and say that there are 20,000 names that drop everyday, ask yourself, how many RENEWALS happen in the last few weeks before a name is officially expires (expires, not DROPs)? My answer? Almost all of them (ok, my guess is > 85%-90%). Just my guess mind you. Its the nature of people to wait until the last moment.

FUZZY LOGIC
It is FUZZY LOGIC when you guess which name will drop months in advance. Some are easier, like the ones that are inactive, for many months, the e-mail is broken, etc, etc. Even these I've seen renewed as people suddenly "wake up" at the last moment.

Couple this with the "spoiler" telephone calls that will go out, attempting to "procure" domain names outside of the WLS method (when that option has been taken by someone else), and you have a chaotic landscape of perilous investment to consider.

CONSIDERED ASSUMPTIONS
Again... my assumption (and I believe I'm right), is that MOST domain names are renewed in the last few months before they expire. So, placing WLS subs without clear signals before then (with few exceptions) is a shot in the dark (many without *ANY* signals will expire and drop). Some "small players" might place subs on names and "luck out", but not even BuyDomains will be able to cover ALL "good names" with less more than 3 months to go on them (many small players will no doubt place subs on names with even greater times on them, and no sign of dropping).

Also, remember... you have only 3 exchanges on all subs. If inside those 3 months, your targetted name is RENEWED, you'd be a fool to keep it there. So, what if you have THOUSANDS of subs suddenly have names renew? Gotta move them. They'll keep trickling like that everyday... even more actively the further in advance they're subbed.

MY EXAMPLE
For instance, I've placed snaps on 2 names that expire in the beginning of next year. I did this months ago (end of September) I'd been looking at some patterns, and I feel that this organization is going to drop all of their names, and I liked these. Does BD have access to that same information? Maybe, maybe not. Without it though, betting such names would drop would be stupid. If my information on this organization, and my attention to this name "sector" (that these names fall under) pans out, I'll get these names. I also consider this organization to be "uncontactable", so its an extra plus as it will stifle "spoilers".

I'm disappointed WLS hasn't launched already, as the closer we get to when those names expire, the more people will begin to look at them the same way. I was beat out last year by BuyDomains on a name I'd found 6 months in advance. I don't think the numbers support the logic most people are predicting. I really don't.

THE REAL COSTS
Saying if BD spends $15,000 on ONE name today, means they'll be able to get almost 400 names with the same money is BAD LOGIC. They're per domain name acquisition costs (due to spreads) will be MUCH higher than $35 a name. Could be $300-$800... even $1,500 a name... maybe much much more. How many names did they need to cover, and how far in advance of drop, before they got ONE name that actually dropped (that's how its calculated)?

That's the question, and the clear... sparkling opportunity for anyone who can leverage individual talent. The only people who will LOSE in WLS, are the people that refuse to think in 4 dimensions, and who GIVE UP before the game begins.

To punctuate this point, here is what eNom had to say regarding the technical implementation concerns with WLS regarding predictable behavior patterns of those placing subs:

Proposed Wait-list Service (WLS) Position
ENom, Inc. - January 12 2001

[-- SNIP --]

3) WLS usage will spike for about a minute a day and be will quiet for the rest of the day. This is because intelligent purchasers, who will number most as the end-users of the WLS system, will only purchase a WLS subscription (or switch subscriptions to a different name) if they know for sure the name will be dropping, otherwise, the $40 fee will go for nothing, and they will be unwilling to take the risk on that happening. Therefore, as soon as the list of to-be-dropped names is known (via zone file or other means), the WLS subscriptions for the most valuable of those names will be grabbed immediately. All the registrars who will be playing in this game will slam the ftp site to try to get the zone file first (or, even worse, continually perform hits on the root name servers to see if a name is still there, or whatever), then, as quick as they can, they will reconcile it with demand lists from their customers and try to be the very first to get a WLS on a valuable name that for-sure will be dropping. Unfortunately this inherent flaw to the WLS model:

• Requires the WLS system to be sized much larger in order to handle requests during this load spike while the system remains nearly unused the rest of the day.
• Means that only sophisticated purchasers and fast registrars, not the common consumer, will be able to grab names that will definitely be dropping. The mainstream consumer will only be able to wait-list names that may drop. The mainstream consumer will have to take the risk that the name actually drops. This risk will be huge because most names that are not already expired will probably not drop during the WLS period, and those that do, probably did so on error and should be returned to the registrant not to the WLS subscriber.
• Means that knowledge of which names will be dropping (not to be confused with expiration date data) becomes extremely valuable and the registrar with this information will have an advantage over the others. The complete list is information that only the registry knows for sure, but a registrar who is performing deletes in or out of the 45-day window, will know some of it. Since Verisign performs by far the most deletes, the Verisign registrar would have an advantage over the other registrars because it will know most of the list before the others. If WLS is implemented, we recommend that this information be freely, equally, simultaneously, and openly available in advance (say 3 days) to every registrar, and at a minimum not allowed to be used by Verisign to advantage SnapNames or any 3rd party or registrar by disclosing it in advance to anyone.

[-- SNIP --]

I, for one, cannot believe a rational person will pay $40 for an option, to maybe, within a year, get the opportunity to buy a $6 product for $6. I can believe that a rational person will pay $40 for an option to buy a $46 product for $6 up to one year in the future. Therefore, what a $40 WLS price really means is that the price of the product is not $6 in the future, but more.

The statements above were made in January 2001, but I don't believe the logic underlying them has moved that much. I DO believe people will pay $40 for a $6 product up to a year in advance. However, the degree of risk (as pointed out above) is considerable, and escalates dramatically, the more names you intend to cover, the further in advance of the nebulous criteria called "expiration date".

So... launch the damn thing already so my ponies can get on the track.

Best Regards,
~ Nexus

 

[mole]

whoa.. what a post nex.

 

[dvdrip]

Nexus is my hero.
Thanks!
I think I will save this thread.

 

[shaw]

Nexus, thanks for the great analysis. I guess that's why BD is so strongly against WLS, although the anti-WLS camp always says WLS is going to benefit big players like BD.

 

[actnow]

The bigger players will continue to be the major players.

Nexus, your analysis is very good. But, I am not sure I agree with
all of your points.

I am not very happy about paying huge sums for names. But, at least,
if I pay it, I can get the name.

 

[HOMEY1234]

Originally posted by actnow
The bigger players will continue to be the major players.

The Big & The smart will adapt, that is for sure. Human nature doesn't like change, however it is also Human nature to adapt better then any other creature. In general, if you didn't get names now, you most likely wont then... If you get a ton now you will then, the MAIN difference will be Vrsg gets MORE MONEY.. Gee what a shock!! LOL

 

[HLK]

Hey Guy's, whether or not WLS comes to pass you better develop
some sites.

Just grabbing domains alone is not enough.
You can still buy a decent name affordably for your product/service.

Find something that you have interest in (besides money of course) and develop!!

What are you waiting for???

ONE good site can set you free from working for anyone ever again.

HLK http://autofinder.com

 

[mole]

Originally posted by HLK
Find something that you have interest in (besides money of course) and develop!!

:laugh:

 

[sitehq]

in your WLS analysis dont forget that some players will stock up on WLS's, on free credit cards at 6 months interest free.. they will NEED to sell those WLS's that turn into names to raise cash ..so we will have a auction model for WLS's... at about the same level as pool auctions today..in other words even BuyD may not be able to hold inventory for 1-2 years when they have such an investment in WLS's.

so the reality is look at your portfolio....names are worth more now so your inventory is worth more, but your acquistion costs are going up...thats how i see it.

 

[mole]

Originally posted by sitehq
but your acquistion costs are going up...thats how i see it.

In a dollar sense, it actually goes down if the WLS goes the home run, hq. In real terms where time is money and you need to do more homework, it will go up.

Overall, it should come down.

1. If you see a WLS on a name, just forget dreaming and wasting your time monitoring the name and approach the owner directly and take your chances.

2. Be prepared to walk away. ICANN will be introducing yet another round of gTLDs end 2004. Practice developing your names. Some sites on new namespace like http://www.computercops.biz are doing very well, thank you. The Internet needs more developers, not speculative dreamers

 

[shaw]

Originally posted by actnow
The bigger players will continue to be the major players.

Nexus, your analysis is very good. But, I am not sure I agree with
all of your points.

I am not very happy about paying huge sums for names. But, at least,
if I pay it, I can get the name.

If you are willing to pay huge sums for names, you can still pay the major players like BD to get the name, with or without WLS.