In A League Of His Own: David Kesmodel, Author Of “The Domain Game”
Posted October 17th, 2008
David Kesmodel, author of “The Domain Game: How People Get Rich From Internet Domain Names” and Wall Street Journal reporter has found himself in an unlikely position. He is currently the default historian of the domain business. Kesmodel recently sat down with us to answer a few questions about his view of the domain space, the challenges of recording a history of such a secretive business and why the sound track of his life is “Itsy Bitsy Spider”.
NameSmash: You’ve created a centralized history of the domain business that doesn’t exist in any other form. It’s a truly valuable tool for all sides of the domain business. What attracted you to writing about such a relatively under the radar industry?
David Kesmodel: I was intrigued by the people who make up this industry. I thought I could write a compelling story about a little-known group of people who buy, sell and park domain names–pursuing a field that few of their family members understand, let alone friends and neighbors. They are a diverse group, but many of them intrigued me because they are risk takers, don’t have much patience for authority and are creative about how they go about making money. They are often irreverent and rarely boring.
NameSmash: How did you come to an awareness of domaining as a legitimate industry?
David Kesmodel: I was reporting on technology for the Wall Street Journal Online in 2005 when someone sent us a press release about a $1 million domain sale–fish.com. I wanted to write about that deal, but I needed to find a broader trend story to persuade my editors. So I started fishing around–pun intended–and stumbled onto several companies that were aggregating domain names and making money off pay-per-click ads. One of these was iREIT, which was attracting some influential investors. I recognized that there was a heretofore little-known business model that was just exploding. Many people had heard of folks grabbing some good generic names in the early days of the Web and reselling them, but the domain-parking business was another world.
NameSmash: Do you hold domain names yourself?
David Kesmodel: I own a few, but I’m not really an investor. Most of my names are for personal use, like for promoting my book.
NameSmash: So you really have a unique window into the domain industry.
David Kesmodel: I think so. It’s really the perspective of a journalist trying to ferret out what’s happening in a complex marketplace.
NameSmash: Was the story you set out to tell about the domain industry the one that ended up in the book or did you find, after spending time with the domain community that the resulting history was not what you expected to find?
David Kesmodel: I didn’t know exactly what I would find when I set out to write the book, but my discoveries lived up to my expectations. I knew there had to be intriguing personal stories about people who made a fortune on domains, and I was right. I also suspected that there was a pattern to the innovations in the industry–such as drop-catching–and that I could weave together those developments to help the reader see that the industry was more unified, more like an ecosystem, than people might think. It wasn’t just a bunch of disconnected people visiting their computer each day to check out domains available for sale and buy a few and sell a few. There is a lot to it. And I have no doubt that I missed many great stories that I just wasn’t able to find because of the inherent secrecy of the industry and the time challenges I faced.
NameSmash: Was it difficult to find people who were willing to go on record discussing the business?
David Kesmodel: Yes, it was difficult to find many people willing to go on the record AND share a lot of detail about the business. There are plenty of people who will talk generally about the domain market, but to right a good book, I needed to find people willing to share a lot of specifics on prices and negotiations and personal challenges they faced. People are very secretive, often for competitive reasons, so information wasn’t easy to come by.
NameSmash: Who was your “in”?
David Kesmodel: I had several. Frank Schilling and Garry Chernoff, two of the investors described at length in the book, were among those willing to provide a lot of detailed information. It really helped that both of those guys have good memories and keep pretty good records.
NameSmash: From what you have seen, and the information you have gathered you have, possibly, the most objective view of the domain business of anyone who understands it. Where in your opinion is the domain industry headed?
David Kesmodel: Oh, thank you. In the short term, it appears the industry will face some challenges from the weaker economy, as advertisers trim spending on pay-per-click ads or fewer users click on the ads. But in general I think the industry is heading toward greater sophistication and will continue to grow in terms of revenue. More sites will be developed, often in creative ways we don’t envision now. There is a limit to the number of desirable domains, so as more people and companies do business online, those names should appreciate in value. Domain trading should increase as more Web users become acquainted with the domain market. It won’t be a huge industry, but it will continue to build wealth for its brightest participants. The international nature of the business will help it endure economic downturns. In general, I think people who are patient about this market and do meticulous research about the opportunities in it can do pretty well.
NameSmash: As a writer for the leading financial paper in the country, how deeply do you feel the economic crisis will intermingle with the domain business. I know you touched on that a bit in your previous answer but I am curious to hear how it stacks up in your eyes to other internet based industries.
David Kesmodel: It will have an impact, undoubtedly, but I don’t think it will be severe, in part because it is such a global field. Also, new companies will form in this downturn–companies that want to seize the opportunity afforded by bearish markets–and some of those will want a good domain name. Also, domain investors to some extent are used to dealing with liquidity challenges, so they may be able to handle going long periods without being able to sell particular names. The challenge will be in reduced revenue growth from ads. Still, one has to think of the opportunities a bearish domain market could afford. That type of market is precisely the one Frank Schilling capitalized on earlier this decade.
NameSmash: How did you find the atmosphere of this past T.R.A.F.F.I.C show in comparison with those you have previously attended?
David Kesmodel: It was upbeat, but a little less upbeat than the show I attended in October 2006. That was the only other one I’ve been to. Perhaps I missed something, but it didn’t appear that Google and Yahoo were as visible at this latest show. Still, one thing that was very similar was I met a lot of domain investors who are very enthused about the field and feel confident they will do well, if they haven’t already. Talking to these people actually gets me more motivated to pursue my interests with similar levels of zeal.
NameSmash: What are you listening to and what are you reading?
David Kesmodel: I have been mostly listening to my two-year-old daughter’s music-class CDs. Songs like Itzy Bitsy Spider. I’m not kidding. We play them in the car everywhere we go. I haven’t picked up my iPod in a month. As for books, I have been reading a short story collection from Richard Ford, one of my favorite writers. And I just picked up a Men’s Journal to read their piece on a deadly mountain-climbing expedition on K2.
Tags: David Kesmodel, domaining, The Domain Game
Posted in Interviews by Kelly Hardy
