Domain Registration Related News
Search-Optimized Domain Portfolio Sells for
$164 Million
February 2005
Internet marketing firm Marchex Inc. has
finalized a deal to pay a whopping $164.2 million
for Name Development Ltd., which displays keyword
advertising across a portfolio of more than
100,000 domains. The deal, along with the recent
sale of a misspelled domain name for $112,000,
offers evidence that mistyped URLs and other
"accidental traffic" have become big business.
The price tag on the sale of Name Development is
more than the $155 million paid by SAVVIS
Communications to acquire Cable & Wireless
America, and nearly as much as the $176 million
Freenet paid for the hosting operations of
Germany's Tect AG. SAVVIS gained about 350K
hostnames in the C&W deal, while Freenet acquired
2.2 million hostnames from Tect.
Given those valuations, why would Marchex pay $164
million for an obscure company that owns 100,000
domains? The deal was driven by the growth of
Internet keyword advertising, which has enhanced
the value of domains that can attract traffic
without any original content, allowing speculators
to turn typos and search-optimized advertising
sites into dollars.
|