Tucows President Responds to Our Post About YummyNames.com
Elliot Noss, the President and CEO of Tucows has responded to our post of a few days ago regarding the YummyNames.com, the site Tucows set up to sell some of the domains it acquired from it’s customers after they expired.
The comments from Mr. Noss are unedited.
Our comments will follow but feel free to comment:
“”"”"I wanted to weigh in here and provide my view very specifically. apologies in advance as I am famously long-winded (stop laughing berryhill)
first. what do we do? we have been very open in what we are doing, what our grace periods are and how we implement them. we have been open about it since we started in 2006. we review names for brandability and revenue potential. we provide, if I am not mistaken, the longest grace periods in the industry and, again I believe, are perhaps the only registrar to honor redemption grace period on names other than as dictated to us by the auction providers. I would note here that in negotiating with the auction providers (and we have spoken to all of them) they are clear that they are not interested in us allowing an auction to be subject to a grace period for the benefit of the original registrant.
after the grace periods we retain names in our discretion. what we do not choose to retain (I believe this to be over 98%) goes to auction. what does not go to auction is dropped.
I would note that our grace periods and our specific practices are clear and available. we do not play hide the peanut. we do not have sister companies that take ownership. we understand many other registrars are a little more opaque in their practices.
second, in my view there are only two differences in what we are doing and what a registrar who has all their names flow into auction is doing. before the differences though, the more important point, as many of you have noted, is the similarity, that the registrar is capturing the excess economic value.
the two differences are timing and path. in terms of timing, a registrar who sends to auction sells the name to a wholesaler who will then either keep it in a large portfolio for revenue or wait for the best-use end user to buy it. most often both are true. the registrar gets money immediately at what will usually be a lower level than if sold to an end user directly. the registrar trades money for timing and certainty. by the way, after doing this for three years what we are doing may or may not be better.
the other difference is path. in an auction the domain most often flows through a domainer before reaching an end user and will sit in a domainer portfolio collecting revenue in the interim (or not), just like it sits in our portfolio.
third, I think it is instructive to look at the history of the drop. there have been three clear phases, the wild west, the primacy of the auctions and the last couple years.
in the wild west guys like scott day, gary chernoff and frank schilling flourished and those who knew the secret handshake benefited.
in the primacy of the auctions guys like rob hall, paul stahura and clint page flourished and there was a higher degree of standardization, but not if you were the registry (who got hammered) or ICANN (who were inundated with hundreds of “registrar” applications from the same entities in an orwellian arms race).
the situation of the last few years is a further evolution with the markets becoming more efficient.
the one thing I will guarantee going forward is that the market for secondary domain names will continue to evolve and will continue to evolve towards efficiency. I will also note that in rapidly evolving markets smart entrepreneurs skate to where the puck is going. when the market evolved from stage one to stage two scott, gary and frank did not whine and complain, they figured out how to thrive in the next phase. when it evolved from stage two to stage three, rob, paul and clint did not whine and complain. they figured out how to thrive in the next phase. people who look back on how rapidly evolving markets were and try to legislate or wish them back in to existence are sort of like the music industry looking at the Internet.
an interesting historical note. we were one of the last registrars to get into taking advantage of expiring names. in 2004, before NSI launched their original snap names auction for their expiring names, I tried to get the registry and the large registrars to agree on a framework not unlike some of what was discussed above. in that framework I stressed the rights of the original registrant. I was met with derision from registrars and domainers, greed from the registry and apathy from registrants. it was only long after it was clear to me that I would be unable to effect change in that direction that we went down the path we did.
lastly, I think this whole issue is a sad distraction. registrars and domain owners (and we are both) have common cause in two respects, registrant rights and fighting against overreaching IP interests. Tucows has an unmatched record on these two issues. you did not see our names handed over to the state of kentucky.
we have spent more time, money and effort on transfers, whois and so many other registrant rights issues from the dawn of competition than any other registrar. both the ICA and the ALAC recognize that. we have spent more time and money fighting IP interests inside of ICANN and the courts of two countries (and of course in UDRPs) than any other registrar. we have the most generous grace periods, the fairest and most transparent transfer rules and, by the way, some of the VERY largest domain holders as customers.
I am more than happy to dig into this stuff deeper. I have no doubt many who are here disagree, but at least hopefully this will help us focus on what it is we disagree on.”"”"
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@ StevenH, lol some companies make me laff..
I play “” hide the peanut”" with my wife all the time.
I am sorry if he doesn’t.
Cheers
Hi Steven,
I’m the General Manager of YummyNames, and I would like to address your comments:
* “It only took 6 days to get back to me.”
I checked and you emailed us on Friday at 6:38 PM our time. We replied the following Monday at 10:59 AM. Our goal is to reply within one or two business days, which we did. The reply did have to wait over the weekend and maybe that’s why it seemed longer to you.
* “They sent a canned response.”
Yes, our initial responses are ‘canned’. Given the number of inquiries we deal with daily that is the only way we can manage.
* “It’s a fairly obscure dictionary name thats worth about $2-4k and they said they want high 5 figures SHYEA RIGHT!
It’s a six-letter, one-word, highly-brandable .com domain similar to Rattle.com or Jumble.com. If you shop around, I think you will find that domains like that are hard to find for less than five figures.
* “To avoid sticker shock they want me to send them my finacial to make sure (they can hammer me) I can afford what they’ll ask. Again SHYEA RIGHT!”
We did NOT ask you for your financials. We asked you if your domain name acquisition budget would support a five-figure domain purchase like this because we value our customers’ time and don’t want to waste it by entering into negotiations that will never go anywhere. This is a reasonably standard and time-honoured negotiation response.
Feel free to contact me directly at bill [at] yummynames.com if you’d like to discuss any of this further.
Bill if you valued your customers domain names as much as you claim to value their time yummy names would not own the 3, 4, 5, and 6 letter highly brandable domain names that you sell at yummy names. Remember you scooped them off of your clients!!! Maybe you should concentrate on valuing your clients and their names and businesses as opposed to their time. Scummy names YUK
Don’t
We may not like it but perfectly legal and within ICANN Rules
I’ll retract the 6 day snurk. You see, I also get hundreds of emails on a daily basis myself, yet somehow I manage to answer them, myself. I will say that you did get back to me in 3 days. The rest stands. If you think think gobble.com is in the same class as rattle.com and jumble.com by virtue of having an “le” at the end then please, by all means, shoot for the moon on it. I’m sure someone out there, who may be flush with cash from a recent lotto payoff, will gladly pay 5 figures based on your assertion of the value for such a name.
You might want to update appraisers that gobble.com somehow bucks the trends unbeknownst to them as well. Oh and let Google know that Gobble is in fact searched as many times per month (3 days before Thanksgiving)
As for a registrar building up a portfolio of high value names: Somehow I think that a registrar has an unfair advantage and is highly suspect of shady dealings. In fact if this is perfectly legal according to ICANN, it might be worth pointing the AG toward. As you know, regardless of what ICANN might claim as “perfectly legal”, it may not actually be legal in the real world. You know, Unfair Practice Act and all that legal nonsense.
But I digress, as this is just one mans opinion for what little it’s worth.
I don’t think domainers understand that EVERY REGISTRAR sucks up the “good” domains as fast as they can when you forget to renew them. I had one snatched from a company I’ve worked with for five years just this month, they sent it to auction with 35 days of it expiring and sold it. I was then contacted by my own rep at that registrar who gleefully told me she contacted the “buyer” of my domain, who would sell it back to me for only $1,450. Isn’t that how we domainers with over 1000 domains at a registrar want to be treated? My experience in 11 years of domain buying is most registrars would return it to you in this time for a price. That is, if they didn’t have a built-in auction site connected to it.
Most ethical registrars will wait 45 days after expiry to steal your domain and make a profit from it.
Most registrars aren’t ethical — except Fabulous so far.
@monte
A few thoughts:
Why not give registrants the option to participate in the proceeds from drop auctions? If I could opt to pay an extra dollar per domain name at the time of registration to share 50/50 in the SnapNames’ auction proceeds for names I might later choose to let drop, I would not hesitate. Selling as an owner on SnapNames (in advance of the expiration date) is far different than drop auctions where the domain owner is no longer in control.
Market makers promote liquidity. So what is the point of any party offering a domain name appraisal unless that party is willing to back it up with hard dollars? Even if Moniker offered (for a limited period of time following the appraisal date) to purchase a domain name for 50% of the value Moniker places on it, this would create instant liquidity and go a long way toward building confidence in domain valuations.
I’d rather see rules created for domain ownership that would take the registrar completely out of the ownership cycle. Whether by beginning the deletion process at 14 or 30 days prior to expiration, or requiring multiple year registrations. The registrars, while having to foot a small reg fee in the deletion window, are placed in a position of reaping massive profits on the financial hardship or absent mindedness of their clients.
I’m also weary of the fact that registrars can sniff at lightspeed while we as the end users can be banned if we sniff more than a few times per minute. So they have a built in advantage by removing any possibility of a lucky catch to junk names. The system isn’t setup to be a level playing field in any direction. I remember the days of Netsol being the ONLY registrar by government mandate… and $200 Yr reg fees. Registrars have enjoyed a monopoly which simply isn’t acceptable in any other industry that I can think of.
@SDM I’d lay money that registrars would simple hold the names for whatever “share period” there might be and then sell the names.