Domain Fascination

I’m sure you’ve hit one of those domains where the only thing on the page is advertisements and highly relevant links. is an example of this. At SES in San Jose, we ran into a company that boasts over 400,000 domains with ads like that and several hundred thousand more managed for other companies. The company, Dark Blue Sea is publicly traded in Australia and is apparently in the business of selling these domains.
Most of the domains are available for around $500 each. A few sell for even more. Presumably the sale price of each domain is some multiple of advertising revenue on an annual basis. The entire business is built around domains you might be likely to type in directly when searching for something. Take the example above. Say you’re planning a trip to Seattle this year and you want to find deals before you get there. What might be the obvious place to look for deals in Seattle? I would probably go to Google and do a search, but some percentage of searches type in and are taken to a page filled with ads.
When you consider a domain registrar can purchase domains for about $6 wholesale (maybe less), this starts to look like an amazing business model – assuming you have the cash on hand to purchase 400k domains at $6 each. Even if you don’t, it might be possible to turn as few as 200 domains into a six-figure income, although the annual registration costs will be in the $8-10 range, so you have a little more overhead.
I’m not advocating a similar strategy, especially not without some education about domain value. I’m simply fascinated by the idea that a company can make a ton of money by essentially populating thousands of domains with nothing. No pop-ups required. No spyware needed. Just a bunch of links that result in payment when clicked. Who says the Dot.Com insanity ended in 2000?