Live online auction will take place January 3.
DomainTools announced its next live auction today on its blog. The auction will utilize improved auction software similar to the software used at the recent Domain Roundtable conference.
This auction won’t be tied to a conference, and the timing is rather odd — January 3rd. Many people are still on vacation. Even though they can login from their computers to bid, this is a tough time to hold an auction.
There are two catches for sellers this time around. First, DomainTools has exclusive rights to sell the domains for 60 days after the auction. Although I understand the reasoning behind this rule, it’s somewhat hypocritical since DomainTools CEO Jay Westerdal made a backhanded jab against other auctioneers (i.e. Moniker) last time around about this type of exclusivity. In response to a comment on his blog, Westerdal said:
“UPDATE BY JAY: We are not going to lock people into contracts for months. This should be a free market so people are free to come and go after the auction is over and no one bid on the domain.”
Second, domains not sold at the auction can be sold by DomainTools for 20% less than the reserve during the two month lockup. As many people pointed out on the DomainTools blog, this disincentivizes people to bid during the auction. If no one else is bidding on a domain, you may as well not bid and then pick it up after the auction for up to 20% off.
DomainTools had a very innovative auction in August, and I’m excited to see the new auction format and software in action. But the company might want to reconsider its new rules.
Steve M. says
Boy; Jay’s timing really is really tough on this one.
As you say, Andrew, very early in the year…plus; I’m sure that many sellers have already submitted their “Jan/Feb auction” domains to Snapnames for the DomainFest conference; and/or to the upcoming Moniker auction/s.
This “overlapping contract exclusivity” problem could; I suspect; measurably impact both the number–and quality–of domains that Jay and his team get to review.
Some sellers could find themselves legally obligated to pay 3 commissions if they’re not careful.
The 20 name limit is a great idea, though; should make their job of going though the junk quicker and easier for them; as well as for the buyers.
As for the “20% lower prices after the auction” ; how about making the prices 20% HIGHER after the auction instead?
Now that might increase auction activity.
don1 says
Why don’t they just go for 50% lower prices after the auction and extend the rights to 5 years after the auction, then you will get everyones interest.
Jan 3rd, why not christmas eve.
Drop the exclusive rights.. Remove the 20% and make it in middle of Jan. And then you may get some takers. But the timing is bad, people are on vactions and NO ONE likes to be locked in to anything for any extended period of time. Just my thoughts..
Mark Stein says
Jay loses more credibility everyday.
The guy has appointed himself as the “domain policeman.”
He is obviously in cahoots with the guy running http://www.domaindetectives.net
I can’t wait till he is hoisted by his own petards.
Stephen Douglas says
Mark Stein is rumored to be a genius. I don’t remember where I heard that, but I think I heard it somewhere.