The value of a domain name comes from a number of factors including:

• its brand connotations, e.g. cocacola.com
• its familiarity (or 'generic-ness')
• the number of direct visits (type-ins) it receives
• the ranking of the domain within the search engines for high value terms
• how much someone is willing to pay for it

Tagged as an Internet-age land grab, many people are registering domains as an investment, in the hope that someone will eventually want the names enough to pay for them. This is increasingly popular in Australia since the announcement by auDA (the governing body for .com.au registrations) that the current ban on domain name trading will be lifted in June '08, opening the doors to a potentially very lucrative market.

Much of the value in domain names comes from their indexing in the search engines, which can only occur with live websites, but most people wouldn't want to go the effort of creating a full-blown web application. Domain parking is the answer.

With domain parking, you create a basic website with a few paragraphs of interesting information related to the domain name, add some jiggery-pokery internet magic and sit back and wait until someone with an idea to develop the site offers you a few thousand bucks for your domain. Not a bad return on investment as .com.au domain names cost less than $50 for a 2 year registration. It's been likened to a good old fashioned 'land grab', because once you've registered the name it can be yours forever. And all the while it's sitting there, you can actually earn advertising income from Google through their AdSense system. The more generic the term, the more likely the site will also benefit from direct visits, also known as 'type ins', where visitors have speculatively typed the domain name into their browser address bar.

Registering domains for use in this way is not a guaranteed road to riches. Sometimes you'll get nothing, sometimes you'll get enough action to make it worthwhile, and sometimes, if you really hit the big time, you can earn A LOT of money. The highest reported domain name sale was $11.5million for 'fund.com' and even 'bedroomfurniture.com' recently sold for over $280,000^†. It doesn't matter how cool, generic or otherwise the domain name is - they all cost the same to register, and once they're registered they're yours for as long as you're willing to pay for the renewals (unless you happen to contravene any trademark laws, of course). If you think all the good ones are gone, you'd be wrong. Ironically, I was able to register 'domain-parking.com.au' just a week or two ago - and there are supposed to be professionals out there doing this for a living! There are literally hundreds of variations on generic terms (think pluralisations, etc) still available. Whilst some are obviously better than others, every name has a value to someone.

Not wanting to miss an opportunity, I've created a new website to make the domain parking process very easy. Once you've registered the domain name it should take less than 10 minutes to have a website ready to go and everything should be live within 24 hours. It will be even quicker by the time I've completed the new site (currently in beta stage) as you'll be able to register domains on the site, too (you can currently check availability only).

The new site, domain-parking.com.au is not 100% complete, yet, and there's litte in the way of documentation to tell you what to do to get your domain listed, but I hope to have this completed in the next few days. If you can figure it out, or you know what you're doing, you can still use the site to create your 'one page wonders' whilst I'm finishing up.

^† Source: "The big internet land grab", The Sun-Herald, March 30, 2008