I received a response from an e-mail I sent to the company that owns my preferred domain name for my company. Consider:
Thank you for your inquiry.
[Domain Squatting company] is a new concept in premium domain names. We have over ten thousand premium .COM domains, all available for lease or purchase. These are some of the best domains available on the web, and many are worth thousands or even tens of thousands of dollars.
Our goal is to make these premium domains available to everyone. Because we make the actual investment in the domain, we have the flexibility to offer a pricing plan with the most efficient price points, and the most flexibility.
Each of our domains is available to be leased or purchased with the following options:
For Domain Names consisting of 8 or more characters (not counting the .COM):
1. Monthly Lease for $9.95 per month
2. Annual Lease for $99 per year
3. Purchase for $495.00
For Domain Names consisting of 7 or less characters (not counting the .COM):
1. Monthly Lease for $19.95 per month
2. Annual Lease for $195 per year
3. Purchase for $995.00
If you are interested in leasing or purchasing one or more of our premium domains, please send us an email and let us know which ones. We will then email you a link that will take you to a customized checkout page.
[Domain Squatting company]
Domain squatting is not a new concept; it’s been happening since the Web became The Next Big Thing. And yet, it hasn’t gotten any less despicable.
There is no “actual investment” involved with this company. I’m guessing they pay some college kid $8 an hour to search for available domain names that contain “key” words. That college kid gives the company a list and [Domain Squatting company] registers the list in bulk, probably paying a few bucks for each name. Assuming $4, with more than ten thousand domain names, that’s a $40,000 “investment” for this new concept. I will concede that to be a large sum for an initial start-up cost, but if they sold them all, their revenue would be between $5 and $10 million, a tidy profit.
They won’t sell them all (I’ve seen the list and most of the names are not “premium”), so I’ll be conservative in the rest of my estimate. To make an easy number, I’ll put $10,000 in overhead for the year, giving a nice round $50k for costs. To break even, assuming a nearly even-split between the categories, [Domain Squatting company] will need to sell 67 premium domain names.
There might be 67 names on that list worth using, names that might generate revenue to justify an expense beyond the normal cost of domain registration. [Domain Squatting company]’s business model is good because it has a low sales threshold to achieve success, assuming their prospective consumers are willing. But a “new concept”? No, a new concept would’ve been a methodology to determine which 67 will sell and then only buying those.
They’ll have to find 67 other suckers.