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Goldnames find goldmine by banking on the com

The Sunday Business Post

(Aug27, 2000)

An Israeli internet company which recently launched an `investment bank’ offering clients the opportunity to invest in domain names raises some interesting questions regarding the potential of local country domains to compete with their com, net and org cousins. Goldnames, which is based in Jerusalem, has 40 full-time staff who are busily registering names in 12 languages on the com domain. As com becomes saturated with English addresses, other languages offer new possibilities. Because com names are available internationally, the new company has a potentially huge market and is eyeing up Asia with particular relish.

This will bring Goldnames into direct competition with the local registers in each country it earmarks. At the moment, the company is selling dozens of domain names every week, according to Danny Oberman, vice president, who believes the com suffix leaves the local domain names far behind in terms of international worth. “The com domain is internationally known and is generally the first port of call for someone undertaking a search,” he says, suggesting that Ireland’s domain registry has an uphill job marketing the ie tag. At present there are seven top level domains (TLD): com, net, org, gov, mil, edu and int, as well as the domains used for individual countries, such as ie for Ireland.

Frank Cronin of the Irish Internet Association (IIA) agrees that the com domain is viewed as “the” international business address. However, he feels the ie domain has plenty to offer Irish business. “The ie address has two particularly appealing features that the com cannot match. Firstly, it displays a national identity, whereas a com can be based anywhere geographically.” Secondly, because of the IE Domain Registry’s (IEDR) managed system here in Ireland a company can be fairly confident that a ie trading entity is above board in its dealings. “The com equivalents can be any rogue trader selling out of their garage,” says Cronin.

Aside from generics like or, a domain’s ultimate value will reside in how well it’s known. “If the concept or proposition is solid and it is promoted effectively, it is not solely reliant on the choice of domain as to whether it will be a success or not,” says Cronin. Goldnames, which has a `corporate portfolio’ of 40,000 names, is doing on a grand scale what several small internet companies are attempting in Ireland, and the company shows there is still a market for catchy internet names despite recent cyber squatting court rulings, which have tended to go against companies registering domain names to just sell them on. John Menton, a solicitor with Arthur Cox specialising in internet law, says cyber squatting becomes an issue when domain names incorporate a trademark that belongs to someone else. For example, anyone registering would end up in court very quickly and would be likely to lose their right to any domains with this ending. “This is true even if the registration of a domain name is not followed up with the establishment of a website that trades under the domain name and merely involves an attempt to sell the domain name,” according to Menton.

A precedent covering this scenario was established in Britain in 1998 when the high court condemned the unauthorised registration of a domain name incorporating British Telecom’s trademarks. Menton believes the Irish courts would follow the ruling if a similar situation occurred here. Rather than face lengthy court battles over contentious names, Goldnames registers generic domains which it says are not covered by trade mark. For example `ready2wear’ is one of its current offerings and is causing great interest among clothing companies world-wide. Bidding for a name like this would start at around $20,000. While the IEDR is the only body, in Ireland, with the authority to assign website addresses in the ie domain, the indigenous internet service providers (ISPs) act as a kind of domain name reseller channel and offer customers names in the ie and com domains among others.

This has several benefits, according to Frank Cronin, as companies who wish to apply for a domain but who do not know the technical complexities involved can get assistance from the ISP. ISPs make little profit on the actual selling of the names but they provide additional domain services such as virtual servers, hosting, leasing lines and ISDN. Goldnames on the other hand simply provides services regarding the buying, selling and leasing of names on domains where the ultimate reselling price is not fixed. While it has had no inquiries from Ireland to date, several other companies are now offering com domain names to Irish businesses. Mike Fagan, manager of the IEDR and the man charged with marketing the ie domain, is confident the national domain can fend off the competition. “Saying you have to have a com domain to successfully market your company on the internet is like saying you need an American telephone number to succeed in normal business.” “While there are many stories about individuals selling domain names for millions, 99 per cent of these stories are just hype,” he says. Fagan, like the rest of the internet community, will just have to keep an eye on Goldnames to see if this is true.

The Sunday Business Post