Domain Name Reselling
A couple of weeks ago I got an email notice from someone that the dot com version of one of my dot info domain names was due to expire soon. Today I received an email informing me that the name had come up for auction and that the company was the winning bidder. They were offering to sell me the domain name. There was a link in the email to check their asking price for the domain name. Since the email appeared to be legitimate, not spam, I clicked on the link to check out their offer. A discount domain name registrar sells the dot com domain names for about $30 for a two year contract. The offer from this company was ONLY $458 and they will magnanimously throw in the first years registration. If I don't jump on this deal they inform me that they will put up a site under this domain name themselves.
Is this a legitimate business practice or blackmail? Perhaps it is a little of both. There is a domain name resale industry. People buy names that they think would be very good domain names and then advertise them for sale. I found a name today that was set up in this way. I went to my domain name registrar and searched for the name that I had thought of. The search come back that the name was taken. I was curious to see how the site was being used, so I typed the domain name in the address bar of my browser. I found a parking page with a for sale sign and a group of shopping links on it. This will probably be the fate of the domain name that they are offering to me. Perhaps they will just put up the shopping links in hopes that people looking for my dot info domain will type the habitual dot com in their address bar, and they will get some free traffic to the page.
There is nothing legally or morally wrong with this practice. The company probably needs to make a high profit on the speculative units that they turn to make up for their investment in names that don't sell. They do offer a legitimate service in that they will keep up with the dates and acquire domain names that become available. They include several testimonials to that effect on the page with the offer for the domain name.