An Australian domain name company has sold Hobart.com.au for $65,000 to a website hosting business after purchasing the website for just $875 back in 2005, highlighting the potential riches in buying and selling geographic domains.
While the sale isn’t anywhere near the highest figures earned through the sale of domain names, it represents the potential for lucrative sales in the domain name business, which has become a favourite among tech-savvy investors.
However, the domain seller suggests it may actually be a bargain price, given the problems of developing geographic domains.
Publishing Australia owner David Lye, who is also involved in registrar NetFleet, told SmartCompany this morning the domain is one of several the company picked up back in 2005.
“You had to pay a premium to register one, and it was a bit of luck in actually grabbing them. We got Hobart, Parramatta, Batemans Bay, and a few others.”
While Lye had approached the city of Hobart last year about a possible sale, they declined. “They’re not entirely easy to convince,” he says.
“They also have the opportunity to get a .gov.au domain, which sometimes they want, although in my mind it can be inferior.”
Website hosting company Barkhost, led by Hamish Palmer, picked up the domain. The company owns several others.
Palmer was contacted by SmartCompany this morning, but was unavailable before publication.
But while $65,000 is a hefty sum for a URL, Lye says the domain was sold for what many in the industry would consider to be a bargain price – and that it has something to do with the difficulty in developing geographic-based domains.
“Everybody knows Hobart.com.au, but it’s actually quite hard to develop because people are looking for all different things. If you buy ‘car insurance’ then people know what you’re doing, but Hobart.com.au is a lot broader.”
“That actually makes it quite hard to develop as a website.”
There have been several expensive domain sales this year, including many worth more than six figures. Lye suggests more are hitting that top-tier selling territory – and the space is becoming much more popular among tech-savvy investors.
“This year there have been several, including ‘carinsurance’ which actually sold on eBay for $250,000. There have been a lot more six-figure sales lately.”