What's in a (domain) name? Some serious cash.
At least 100 domain names sold for more than $100,000 last year.
Candy.com is not a particularly attractive site; experienced Web surfers would probably move on to a different page after first glance. The site is not backed by any major confectionery companies; in fact, it doesn't even sell desserts.
The only thing going for Candy.com is its wonderfully generic Web address – one so simple that it was appraised last week for about $2 million. Rick Schwartz, the entrepreneur who owns the site, says he's holding out for more.
While America's housing market slumps, sales of domain names, the real estate of the Internet, climbed 60 percent last year. More than 100 reported domain sales exceeded the $100,000 mark in 2007 – up from 70 the year before. And last May, an adult-themed domain sold for $9.5 million.
This fourth consecutive year of growth shows few signs of slowing, as venture capital and new investors invade the scene.
The surge of new money into the domain market signals a broader acceptance of what many Web entrepreneurs have thought for years: Web companies come and go – but as long as there's an Internet, there will be value in generic domain names.
The philosophy is built on the idea of "direct navigation." Most people rely on Internet search engines such as Google or Yahoo to connect them to what they're looking for online. But about 15 percent of Web surfers – often new users – type terms directly into the address bar and add ".com" to the end, says Ron Jackson, editor and publisher of DN Journal, which covers the domain market. So, if these users are shopping for candy, they'll probably head to Mr. Schwartz's Candy.com.
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