Still Room for Players in Domain Name Game

Written by Laura Tiffany of Entrepreneur.com

One hundred domains. Sounds like a good, round, impressive number. And 100 felt like a lot for Howard Hoffman, who began snapping up domains like HealthWater.com and SportsWater.com to help redirect Web surfers to his bottled water company's site, taking advantage of what's called "type-in traffic," when users just enter words or a guessed-at domain into the browser address bar.

Hoffman then went on to purchase cityMagazine.com-type domains, like SantaFeMagazine.com and MontereyMagazine.com. Then he found out just how big his new hobby could get: "I emailed or spoke with people who owned a thousand or more domains," Hoffman recalls.

That was more than 10 years ago, and today, Hoffman still runs his water company (recently rebranded as o2cool.com), reinvesting any and all profits in the company, while earning his living strictly from domaining.

"Like most people in the business, my wife thought I was crazy, wasting time and money on domains," says Hoffman, who lives in Palo Alto, California, and also runs PPCIncome.com, a review site for domain parking services. "However, she now understands how good it's been that I stuck with domains."

While the real-world real estate market has taken a nosedive, the domain name market is hotter than ever. GoDaddy.com recently announced its 30 millionth name sold; the company registers, renews or transfers domain names at the rate of one per second these days.

"Domains have held up remarkably well," says Ron Jackson, a domain-name investor as well as the editor and publisher of DNJournal.com, a magazine that compiles statistics on the industry. "In the first six months of 2008, total reported sales in the domain aftermarket rose 11.6 percent over the first half of 2007 when the overall economy was in dramatically better condition than it is now."

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