I heard a pretty funny story today. Back in the days of tasting one company was tasting about 200k domains a day. But once they forgot to delete them in the grace period, so they ended up with 200k rubbish domains. This error cost them a petty $1.4 mil 
.
Obviously tasting has been long gone today since the grace period has been cancelled by ICANN. It is now only possible to delete 10% of new registrations in the 5 day period.
Just wanted to bring up an issue that is not often discussed because the current situation is simply taken as for granted – that parking companies are always hostages of one upstream ppc feed provider – that being either Google or Yahoo, which they have to deal with exclusively. Since they know that the relationship is key to their existence, they are very limited in other ways how they can monetize their partners’ domains (the only exception is banned domains for which they can bring in second tier feed providers etc). This prevents innovations in domain monetization.
This arrangement is severealy hurting domain owners and my belief is that certain anti-monopoly style authorities should look into these arrangements. For example I believe that if parking companies would be able to mix both Google and Yahoo together (even on one results page), there would be roughly a 20% uplift of earnings for domain owners. It would also force G/Y to pay out more because they would be competing head-to-head for every click. However both G & Y force exclusivity onto the domain channel with every parking company. There are companies that have both feeds – such as Infospace – but those cannot be used on the domain channel. If Infospace can have both, why not the parking companies?
Jul 5
One of my few strong capabilities has always been the ability to self reflect in any moment in time – make a clearcut judgement at where I am at any given time and thoroughfully evaluate the situation. What I’ve been thinking about lately is one thing – I think I’m losing the edge when it comes to domaining.
When I started out I had an immense thirst for success. I was willing to bet everything on one card – I didn’t have much, so it wasn’t that difficult. I was immensly focused. I was uber-creative, I basically swooped in, had a plan how to use immense leverage and it worked out. If I look after the last 3 years I’ve been in the biz, no single domainer has seen so much growth as I have, my ROI is in the thousands of per cent per anum.
But times have changed. I sort of have a feeling that I’ve accomplished all I wanted in domains. Like it was a game and I completed it. So it stopped being a challenge anymore. When it comes to the material side of things, back in the beginnings I was maybe living off $1k a month. Today I have 3 bling cars, an amazing apartment, a personal 5* french chef, fly private etc and make more money than I can spend. Since I’ve finally accumulated something I have hence become slightly risk-averse. I mean I’m probably willing to take on more risk than 95% of businessmen when the odds are right, but I simply am not in the absolute vanguard I used to be. However that’s probably enough to tip me off the edge. The crazy motivation is also gone. The focus as well – I’ve been spreading across to multiple other businesses. To be honest domains don’t entertain me much anymore – I have to find other things that do, for example I’m just producing a movie etc. When I was younger I recall learning about the Maslow hierarchy of needs in school – I suddenly feel materially secure and I’m heading towards the top of the Maslow pyramid towards the concept of self-actualization. I suddenly feel that I have enough and and becoming more interested in being more happy, being more nice to people, helping people, being more creative, enjoying simple things, doing some charity etc. I simply came to the point of asking what’s the point of making more if I already think I have more than enough?
It’s not that I will drop out of business completely. But the bottom line is that because of all these aspects I mentioned, I am slowly but surely losing the edge that I once had and that nobody could match. I think that all the well known domainers like Frank Schilling or Kevin Ham must have went through something similar. It’s just too difficult to stay on top forever. That’s also the reason I have been blogging less and less – I just think that I don’t have that much to say anymore. And I don’t want to become completely pathetic, like the grandfather to whom’s advice nobody listens to anymore – I prefer to leave that role to others (with all respect, I just think Rick is passed his time). The good news for everyone that is reading – suddenly there is a big opportunity to fill up the vacuum and take over the vanguard of domaining again…
Happy 4th of July everybody!
Jun 10
My apologies for not posting lately, have been quite busy and that coupled with my laziness simply equals no posts for a long time. So anyway, what have I been up to lately…
When it comes to domaining I have to say I’m getting a little bit bored of it. It’s just become a completely routine job for me, going through my daily lists, picking domains etc. I’m actually thinking about putting my domaining operation on “autopilot” since I’ve tought all my guys how to handle everything. Recently I hit 1 million uniques a day as I’ve planned. That was a always my goal and since it’s already reached I just don’t have that much motivation to be honest. To keep myself motivated I just need to keep on coming up with new projects etc that keep me entertained for a year or two.
Two weeks ago we had the iGaming Supershow in Prague, which is basically a huge gettogether for people who are in the online gambling business. I have to say that this industry shares a lot with domaining in the sense that it is a pretty tightly knit circle, pretty secretive etc. One thing is certaing though – it is significantly larger than domaining. I’ve been looking into a gaming project of my own, which I plan to launch maybe in 6 months. My idea is basically to teach people to play various casual skill games against each other for money and charge a rake for connecting players together in the same way poker sites operate. So the idea is that people could play chess, checkers, scrabble etc against each other for a dollar or something like that. I think it will make the games more fun to play as well.
Another of my new projects is a wood processing plant that we will start building in Eastern Slovakia soon. We will basically be processing waste wood and manufacturing wooden pellets out it that will be used by powerplants in Austria and Italy. It’s quite a complex project with a lot of inputs etc, but it’s something new to keep me entertained.
Our online insurance broker ePojisteni.cz has been running strong. We will be moving into a bigger office next month to house our growing army of brokers in the callcenter, currently we have 40 there fulltime. We are also planning a large TV campaign for the autumn on national TV since the pools of available traffic online are just getting slimmer and slimmer and we simply need to keep growing.
Our liposuction clinic Slim & GO has been a big hit, we are currently running on full capacity with 5 machines operating 12 hours a day – we are doing 40 clients a day now. We’re just signing a lease for a new location where we plan to open our secong clinic, which should be even bigger than our first one. It might be a stretch to fill it up with clients, but challenge accepted .
Our facebook developer Viral Maniacs is hopefully going to launch its new game in the US in about 2 weeks. It’s something similar to the Sims. The first version of the game which we only launched in the Czech Rep has been quite a success, he already have about 80k users and 3k join everyday. Viral Maniacs should hopefully break even in July, which would be nice.
I’m also helping out with our new CPA department, I’ll probably joing them for LeadsCon in July in New York.
And that’s pretty much it now…
May 17
What I’ve been working on in the last month or so is building out a standalone CPA department in our company that will focus on monetizing my and my friend’s type-in traffic. The CPA department will be symbiotic with our Elephant Traffic offering because it will be buying traffic for monetization through ET, hence we should be capable of covering more and more verticals soon. We will obviously not be limited only to domain traffic but will also experiment with PPC, display, email etc, mainly acquiring US traffic for our CPA offerings.
The department will be headed by my long time friend Arnost Machytka, who spent the last two years working at Threadneedle, a big fund management firm based in London. Working alongside Arnost will be Martin Glatz, who has worked at Aegis Media recently. You should be seeing us at events such as LeadsCon and Affiliate Summit more often now.
The whole purpose off all these alternative monetization initiatives of mine is simple – by years end I have a goal of generating 20% of my domain income from alternative monetization. Last week Google clawed back $22k from one of my parking accounts for no obvious reason – a stark reminder that I cannot rely on them for monetization.
A lot has been written about the closure of Bido a few weeks ago – about how they got the model wrong, the inventory wasn’t right, it was overtly complex etc.
Just a different perspective from me: I think they made the right decision. It’s really hard to cut your losses but when you do, you should do it early. I think the founders discovered that there wasn’t money to be made there and the potential that they thought was there, really wasn’t. I think that with a little bit of tweaking Bido could get to break even in a couple of months. But after that? It wouldn’t probably be a huge money generator anyway.
A lot of people do not understand the opportunity value of money and time. If Sahar and Jarred would continue working on Bido and making it a minorly successful business the flipside would be the lost opportunity cost – they could use this time to work on a different project/venture that would have more potential and upside. I guess they realized this and I think made the right choice of closing Bido down. Let’s wish them luck on other, more promising, projects!
Otherwise, I still believe there is an aftermarket niche to be carved out with revenue generating names, read the post I wrote about this some time ago here.
May 8
Around 15 people have left Sedo in the past couple of months and I have information that more are to leave soon. That’s never a good sign for a company.
As I get to speak to people from Sedo on and off the mood and morale don’t seem to be very good. It seems that the organization got too hierarchical, bureacratic and unflexible. I think the company just became too German for a high growth and international business such as domains. People working there really have a problem in self realization. This bad mood may be more affecting the European office than the US one though.
Bottom line is that all this and the unflexible mode of doing business may be affecting relationships with key customers and Sedo’s bottom line. More aggressive and flexible companies such as Oversee and Namedrive are chipping away off Sedo’s parking business.
I can really illustrate this on myself. As great as Sedo’s account managers are (Hi Kamila!), they simply don’t call the shots and it is very difficult to push through non-standard business deals because of how Sedo is hierarchical. That’s why Sedo probably only gets around 5% of my business. Compare that to Oversee.net for example. I remember the first time I arrived to DomainFest (at that time I was doing maybe $700 revenue/day, which is basically nothing), my account manager (back then Jim Grace, who does a fantastic job, although we don’t work together any more) already understood my growth story and the potential I can bring them in the future so I got an introduction with Lawrence Ng and Jeff Kupietzky and all the top brass. Because they were able to make quick decisions and do non-standard looking deals, they got to win tonnes of my future business and we have a great relationship. Compare that to Sedo, which completely missed out.
Let’s hope Sedo will be able to reflect on what’s going on and be able to change the workings of the organization so it can get back onto a growth trajectory, wish them luck!
Apr 26
Me and my team (Peter and Mateusz) are heading out to Milan tomorrow Morning. I’m looking forward to meeting all my friends again and doing some proper partying. We are obviously storming TRAFFIC Milan with our Elephant Traffic zero-click offering. We will have an ET booth there as well, that is if we manage to fit the container with the booth into our tiny little jet . So if you haven’t met us yet, please stop by by our booth and let’s talk traffic monetization, we will show you how we can beat parking in the various verticals we cover (such as education).
We also have houses.co.uk on sale in the auction, so make sure you bid!
One thing I have never heard much said about in the domaining industry is the phenomenon of parking page blindness. I.e as parking pages become more profound they are starting to get more and more ignored by users. When we look at how parking earnings declined over the last two years, the major factor behind it is the fall of CPC’s (and everybody is well aware of this). However CTR’s have also declined in this period, which has also contributed to the fall of earnings.There seems to be less of an awareness of declining CTR’s in the industry.
It is likely that the cause behind this is what I am call parking page blindness. As people get more accustomed to landing on parking pages, a large part of them immediately understand that they will bring little value to them and leave, costing us, domainers, a lot of money.
Since I am a big data junkie, I have found that there is an inverse relationship between socio-economic development and click rates on parked pages. I.e countries that are less economically developed and hence it is likely that the internet population has not been online as long as their counterparts in the western world, they have also less experience with dealing with parked pages. Hence they are more likely to click. For example I have found that traffic coming from certain african countries can generate 3x the amount of clicks than, say, the same amount of western european traffic.Although CPC’s are much lower in Africa, the extra amount of clicks can even make the RPM higher than in certain west european countries.
The whole concept of parking page blindness is obviously a big threat to the domaining industry. However there are obviously ways how to fight it such as making parked pages more stickier, introducing display advertising which is generally sold on a CPM basis, bringing in zero-click etc. I hope the parking companies are aware of this.
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