That Was a Heck of a Vacation...

Some might see 5 weeks vacation as wretchedly excessive, but man it feels good..  I think tuning out and changing gears like that adds years to your life. The pause has given me time to reflect and grow as a person. I think I'm going to slow down a bit.. Tippy-toe back into blogging.. Ease my tired fingers back into typing and see where the spirit moves me. I don't think I'll comment on your comments as much..  Please don't take offense to this, but by not speaking to each comment it will give me more time to write better stuff and to relax outside of work --  Something we all need to do more of.

So 5 weeks later a lot has changed..  And at the same time, reading this story shows me how little has changed  -- and how little it is likely to change over the next 18 months. People are still figuring this space out, one person at a time. Every day while traveling I saw domain-related blog posts about old stories, written by people just getting that "Ah-ha" moment.. If you're a savvy domainer constantly trolling forums and news sites for the first glimmer of info about this space, then expect to be bored by a lot more stories like this in future.

I met a lot of deal makers on the road and did some reading about the financial markets. Those folks taught me that domain portfolios of today will get sliced, diced, levered and sold for much more money in future. They will get financed by the same bankers, covered by the same analysts, rated by the same agencies. Only the dollars and quantities will change. More money for fewer names is the future I envision.

Some of this is due to inflation, some due to industry growth, but domain names are going-up .. I firmly believe this to be so.  It's the way of the world I suppose. Low interest rates lead to a real estate bubble which corrects as rates rise, which causes existing mortgage holders to default and debt markets to unravel...  Which causes lower rates as scared bankers cut rates.  The cycle always repeats in a world where few central bankers have the courage to let the market burn the forest to regrow in a healthier way.. Money keeps getting cheaper..  The new 1 million is 3 million or 5 million.

It's the printing presses that keep churning out the Benjamins and make us all feel richer. Only you can't buy as much good stuff with the money.

The domain name business has not historically ridden along on this bubble train. Now, in 2007, as "good looking" names without traffic have begun to get inflated and feel bubblish, the names that generate free-cashflow through type-in traffic are unfairly underpriced. It just doesn't add-up that names which "look cool" but make "no money" get equal or greater step-ups in relative valuation as those which carry the freight and pay the renewals in a portfolio.

I expect to see another leg-up in name valuations late this year or early in 2008 as PPC advertising pay rates firm and as existing ad networks try to grow their own revenues by syndicating incremental advertising formats (syndicated rich media which they sell at premium rates). Those ad pay-rates and a general realization by the man on the street that a high quality domain represents a "storefront", are going to make generic type-in traffic domain names much, much more valuable going forward.  The sniff is out and generic defensible names are going to thrive in the months and years ahead.  Even if those names only get a trickle of daily type-in visits.

That's what I see anyway (You could say I'm biased ;).

Reading domain related posts like this one and obsessing about daily domain name related news bites is a bit like watching a hurricane. We all have a vested interest in seeing where the storm will go, monitoring the minuscia, the trivialities. Looking for signals about the tempest's heading gives us a feeling of control..

Well this vacation has taught me that we are early in the earliest sense.  New Internets may come, higher renewal prices may come, more rules may come, but domain names, (an address on the Internet) will be required long after you and I turn to dust. This storm is going to favor you if you own generic defensible names. The Internet is not going away, Trademark interests will try to over-reach, but they can't reverse the laws of gravity or trademark caselaw. Mark Cuban can dance on it's grave and proclaim the Internet dead, then go back to watching HDTV; but when Mark's kids get news in the future, when they shop for real estate, when they look for directions, when they write a letter to someone, when they pay a bill, when they wire money..  the Internet is how they will do it...  and the site they "do it at" will need to have some kind of address. 

I am betting that more often than not,  that address will be a .com or the CC tld of the Country in which you reside.  This perpetual motion machine of brand reinforcement will keep .com names valuable for a very very long time, providing the registry doesn't screw it up by pricing the space punitively .. we'll have to wait and see on that.

Quite a mishmash of subjects..  not a lot of direction in this post..  just some venting (some of which you've heard before) as I limber up my fingers and get back to work.

Have a great autumn friends.

Comments

[Dave Wrixon]

Welcome back Frank.

It has been a long 5 weeks, but yes you are right, the business is about effecting life-style changes.

[SM]

welcome back!! :)

[aaron wall]

Great to see you back Frank. Bit of a kiss arse comment of me hear, but I love reading your blog because many of the posts are both big picture oriented and defy conventional wisdom.

[Gabe]

Great to see your back to blogging Frank. Wasn't the same without you!

[Ben]

Good to have you back, Frank.

[Roland Buck]

Welcome back Frank! Nice post too... :)

Roland
Chief Editor
DomainNews.com

[Farmer]

Glad your back. I hope you got some much needed R&R. I think the domain world has missed your take on the world according to Frank, I have.

[Todd Mintz]

Awesome speech at the Domain Roundtable. You were incredibly inspiring to newbies in the industry like me. I wrote an article about the conference...you can read it here: http://www.searchengineguide.com/mintz/010541.html

Welcome back and I hope your house didn't get hurt by the hurricane.

[Sahar Sarid]

Glad you had a good time away, must be eye opening to see how early we are in the real world. I yesterday spent some time with a Tennis couch who is getting into Real Estate and mentioned domain names, and he had no clue what I was talking about (by the time I left he was all ears of course).
Long way to go indeed, but we're getting there, one person at a time.
Welcome back!
Cheers
Sahar

[Frank R]

Welcome back Frank, Great speech at the Roundtable. Inspiring & informative.
Learnt alot from you, thanks! "Basics 101 =$$$"
Generic defensible!! Right on target, as in eMall.ca win for CheapTickets.ca & Cheap Ticket trademark stricken from the record for a "descriptive" item.
That's a great victory for Generic Names!
You gotta love that!

Regards,

Frank R

[josh]

Great mishmash of words!

Welcome back, Frank.

josh/
Swerve

[Domainer's Gazette]

welcome back frankie boy.. we missed ya..

[Bill Henson]

"then expect to be bored by a lot more stories like this in future."

Please, bore away Frank. Great to seeya back.

[Snoopy]

Good to see you back Frank.

[Cameron Johnson]

Welcome back Frank. I guess our time at Seven Mile rehab is now over, and much like the multi-tripping celebutantes, we can now resume our addictions in proper fashion. We missed you like a Republican misses kink! ;)

Cameron

[Larry]

Frank,

Your thoughts are like a compass leading the way on an expedition. You bring a sense of comfort in which way to go.
Glad to see you back.

[Javier Marti]

God, I think I am going to be a bit of a contrarian here.
I am not sure why, but you seem to have too many followers that have you idealized or something.
So, I am going to be honest and tell you what I think, even if politically incorrect:
I didn't like your keynote speech. It was not inspiring to me, and I feel that you must be a much better speaker when you prepare your speeches. It seemed that you where going in all directions at once, and I didn't see as much substance in it, or at least not as much as I expected to see knowing you from your posts here.
In fact, I remember that I thought that the one in that speech and the one who writes this blog are different individuals! ;)
I was not technically impressed, but I understand that a newbie can be.
I didn't like your audience either. I consider you an important enough figure in the domain world as not to be speaking when other people are eating. Don't you deserve full attention? Come on...I think so!
In any case, and even acknowledging that I didnt' like your speech, I congratulate you for the blog and welcome you back!
I am sure that my "harsh" comment won't offend such a smart person. But if it does, don't worry, you seem to have too many people around anyway that will tell you that you are perfect all the time.
And this is dangerous. Watch out!
I am not your friend, but I expect of my friends to be objective and tell me when they disagree with me too.
Too many great leaders in all spheres of life come down because they start to believe their own hype, from those around them.
One thing that seems good about you is that you still seem approachable (the other thing I commented with my domainer friend you do well is to use your money to live a high quality life. That's certainly smart too)
In any case, I hope to keep on learning from you and others as always...

Regards from England

Javier Marti
Trendirama.com

PS/ regarding your post: the bubble about "nice names" without traffic is just that, a bubble. Harder economic times are ahead and only the most profitable domains will command top prices. , In my opinion, the "bubble" in the domain world runs parallel to the economy and will correct itself.
Apart from that, it is the first time that I hear you talking about macro-events that affect the domain world, and that's great, because I see domainers like living too much in their little world, disregarding the big picture (economy, social trends, technology trends), and that's pretty worrying...

[owen frager]

Mark Cuban mean to say the Internet was dead without you. Now that you are back, he might rethink his position. Welcome home!

Owen

[Coibuffsoilla]

ORANJESTAD, Aruba - Felix rapidly strengthened into a dangerous Category 5 hurricane and churned through the Caribbean Sea on a path toward Central America, where forecasters said it could make landfall as “potentially catastrophic” storm.
Felix was packing winds of up to 165 mph as it headed west, according to the U.S. National Hurricane Center. It was projected to skirt Honduras’ coastline on Tuesday before slamming into Belize on Wednesday.
“As it stands, we’re still thinking that it will be a potentially catastrophic system in the early portions of this week, Tuesday evening, possibly affecting Honduras and then toward the coast of Belize,” said Dave Roberts, a hurricane specialist at the center in Miami.

[Chris Ward]

Welcome back Frank! Your return marks kind of a unfortunate event: Summer 2007 is over.

I'm always kind of sad to watch my kids walk down the driveway to catch the bus on the first day of school.

http://www.forumgarden.com/forums/attachment.php?attachmentid=17005&d=1188918204

It does, however, herald the fact that traffic is beginning to ramp again and that we have an exciting year ahead of us.

***FS*** So true sir.