Most domain name investors are living on hopes and dreams. They want to buy low, sell high, just like everybody else. Every day they put in countless hours of research, considering the risks of specific domains and investing the little money they do have to fulfill this dream of making it big.
I’m that guy too!
I love domains. I get the butterflies in my stomach when I see “a good one” at auction. I get excited trying to win it and feel the pain of wasted time and dreams slip away when bidder 3 or First or whatever bidding alias or lack there of, shows up besides mine.
How did I lose? Was it just because of money? Is the auction system broke? Is somebody playing outside the “rules” followed by majority?
Likely all of the above is the reality!
My minimal budget is peanuts to companies like HugeDomains, DomainMarket, BuyDomains and the countless other companies and individuals in the domain investing market. It’s not their fault, nor mine, it’s just the way it goes.
What I don’t like is an unfair advantage over any other bidder on any auction system. Yes, finances will often be the largest barrier but when “other” factors come into play… it’s simply not fair.
Is it ok that you are manually bidding against somebody using an API with computer metrics bidding against you? Maybe you didn’t even think of API bidders? It happens both at NameJet and GoDaddy, maybe more services. The two largest domain name auction services, it happens at. NameJet & GoDaddy. These API bidders can bid on 10, 20, 30 or 100’s of domains at a time, when you are left focusing on one or two at best, manually.. refreshing the page with frantic eyes.
The API bot bidding tool doesn’t flinch, nor have to “keep refreshing the page” to see if new bids are placed or you are outbid, that’s automatically done for it and more! You may “miss an auction” because life happened, when the API bidding bots life, is beating you.
Is API bidding fair? Is API bidding providing a “level playing field” for all?
I reached out to Paul Nicks of GoDaddy with a few questions and his thoughts in regards to API bidding. Here are my questions and his response:
Paul, as VP of GoDaddy’s Aftermarket Division, do you consider API bidding as providing a level playing field for all bidders on GoDaddy Auctions?
Yes, both API and manual bid customers have the same information and capabilities. However, the API is provided to customers to allow them the ability to scale their operations by providing the inventory and opportunity to bid on several hundred domains at a time (and which requires use of sophisticated software to keep track).
For manual bidders, we do provide the option of Proxy Bidding, which, if the bidder were to enter a maximum bid amount, would also automate the process in our bid system (up to the maximum).
Can you provide any stats related to how many entities are using API bidding on GoDaddy Auctions and GoDaddy Closeouts, compared to manual bidding.
We are unable to provide specifics, but we do have more manual bidders than API bidders.
How is a GoDaddy Auctions customer able to obtain API access to bid on auctions? Are there any fees, limits or development costs in using the API?
API access can be requested by emailing our support team at firstname.lastname@example.org. There is no fee to use the API, just the time and resources it takes to get set up on the bidder’s side. If someone is interested in the developer guide, they can contact the support team.
Within expiring auctions, there is a “comment” space and at times makes mention of “Automatic Bid Placed”. If a $12, first bid is placed and has a comment of “automatic bid placed”, does this indicate a API bid? (I would assume, in general, Automatic Bid Placed is related to a “proxy bid” but I wouldn’t expect GoDaddy to reveal this “strategy” on a first bid.)
When someone places a product bid above $12 on a domain name and they are the first bidder, the note for “Automatic Bid Placed” will appear.
I have also seen “Bid placed by Back Order process-Bulk” which is the results of a $10, 1 bid situation. I have also seen “auctionMerge”? Is there something that explains these “comments” and the reason behind each of them?
Thanks for highlighting. Though we do not currently have a page like this set up explaining the different comments, our team is working on getting something put together.
What does GoDaddy do with expired domain name auctions that the winning bidder defaults on? Does it go to the second highest bidder? I’m sure there are situations when there was only 1 bidder or the second highest bidder doesn’t want it, then what?
We do not keep any GoDaddy expiring domains. All domains that expire from GoDaddy or GoDaddy resellers go through the exact same Auction process regardless of the quality of the domain.
If the 1st bidder fails to pay we erase their entire bid history and offer the domain to the 2nd highest bidder at the price they would have paid if the 1st bidder never existed. If the 2nd highest bidder doesn’t want the domain then we treat it as if it never got any bids and let it drop.
- Bidder 1: $12
- Bidder 2: $20
- Bidder 3: $30
- Bidder 1: $50
- Bidder 3: $100
- Bidder 1: $150
If Bidder 1 doesn’t pay, then we offer it to Bidder 3 for $30 instead of $100 since we determined that all of Bidder 1’s bids were fraudulent.
-End Of Q&A with Paul –
I personally think that API bidding on domain name auction platforms does not provide a level playing field for all, which the auction services should be striving for. I do not consider proxy bidding and API bidding on the same playing field. Closeout snipping is also heavily at an advantage of an API bidder, who can send several calls to “buy” per second, when a manual bidder can not do that.
I also asked NameJet GM Jonathan Tenenbaum questions in regards to NameJet’s API bidding, but I have not heard back from him after asking 3 times.
The house always wins!
I’m not exactly sure how I feel about service providers that have interest in both sides. Aka, are you the auction house or are you the domain investor? GoDaddy provides it’s auction service, but they are also domain investors (NameFind). They can buy domains, let them expire and still turn a profit in the expired auction. We can’t do that. They also have direct data that a customer doesn’t get to see. It is not known that GoDaddy or GoDaddy employees purchase any domains on GoDaddy Auctions and I do not suspect them to do that. It may happen on some scale but it’s not likely big. It certainly could be happening since whois is really “who do you want to be”. GoDaddy “could be” Paul Smith of Plano, Texas with the gmail address of email@example.com . Nobody would really know. Whois privacy greatly aids in the unknown. No bidding alias on GoDaddy auctions doesn’t help with this matter, nor the way the current whois system works.
NameJet… well, NameJet is owned now by Tucows (eNom prior but Tucows recently purchased them) and has been part owned by Web.com for awhile. Web.com actually owns another domain auction house too, SnapNames.
Both companies (Web.com & Tucows) have been known to warehouse domains. Nothing new or against any rules put forth by ICANN. Warehousing is something I’m very strongly against, because it creates an unfair advantage for the registrar, not allowing other parties the chance to acquire the expired domain in a public auction at no reserve. Only directly from them at the price they set. Both Web.com and Tucows are domain investors and hold large domain name portfolios.
What happens to PendingDelete auctions when the bidder doesn’t pay or a charge back occurs after the auction? I’d hope the auction would be rerun after the non-payment and the “the house” doesn’t just get to keep the domain for basically free (reg fee). Are fake bidder accounts created just to initiate a non-paying bidder? I don’t know but there is always the potential. Even if all things are legit and the high bidder just can not or does not complete the transaction, should the auction service just be able to keep the domain? I don’t think so.
Let’s consider these domain names, auctions and whois movements that hold some questions with them as to what is going on. The following is research used with current whois data, whois history and a few other sources for reference:
MXGB(.)com expired and was grabbed by a Web.com controlled registrar on the drop and auctioned on NameJet April 5, 2017. The domain is won for $1,250 by bidder: tmsues1 (blog.goldname.com bidding winners tracked)
Whois records after the auction completed then show THOMAS SUES, firstname.lastname@example.org (assumed paid for since it transfers to them?) after the auction but then switches in whois records to New Ventures Services Corp (according to whois) and listed with a buy now for $1,077 on Sedo currently (less than it “sold” for on NameJet)? Odd.
PPDA.com is another domain that was won by the tmsues1 bidder on NameJet on January 30, 2017 for $1,015 (source), so that one needs to be watched yet but currently displays Thomas Sues in whois records. Did Thomas “pay” for this one?
KVCP.com, won on NameJet by bidder “Markins” on November 21, 2016 for $404 (source) with whois showing Mark Kartasasmita and email of email@example.com in whois after the auction… then switching in whois on April 3, 2017 to New Ventures Services Corp, which remains now. Domain is listed with a BIN on Afternic for $777. Whois updating to New Ventures Services Corp on 4/3/2017, similar to several domains below!
I reached out to Jonathon, GM at NameJet to see what happened with MXGB.com and KVCP.com specifically.
I followed up with SnapNames/Web.com aftermarket on this as the auctions you initially referenced were not won by NameJet customers. Since the SnapNames/NameJet integration allows both of our customers to participate in the same Pending Delete auctions, SnapNames bidders are given NameJet bidder aliases to track their bids in real time. For example, MXGB.COM was won by “sn–tmsues1”, which is a SnapNames customer, not a NameJet customer. But either way, I checked with them, all of those auctions you ID’d in your original email involved a default or chargeback, which is why the domains did not end up with the winning bidder.
I have asked why these domains were not re-auctioned or offered to the second highest bidder but I did not get a response to that question.
It is important to note, New Ventures Services Corp, is a subsidiary of Web.com, which is part owner of NameJet and sole owner of Snapnames. I make it very clear here that New Ventures Services Corp is a subsidiary of Web.com Group, Inc. I mention this because Web.com has stated many times that they are not associated with New Ventures Services Corp!
I reached out to Web.com Group Inc. with specific regards to the two above mentioned domain names with the following question:
Why were mxgb.com and kvcp.com not reauctioned on NameJet and were taken into ownership directly by the auction house providers ownership, while currently being offered for sale by New Ventures Services Corp?
After a couple weeks, I received a response from Web.com to my question:
Web.com does not comment on individual accounts, but we can assure you that Web.com companies (including NameJet and SnapNames) do not bid against our customers in any auction on our platform.
I thought I was pretty clear with my question, with my main focus on the reason why the domains were not reauctioned and ownership went to New Ventures Services Corp? I didn’t feel my question was answered and I did not receive a reply to my follow up question, as to why. If they can’t comment on individual accounts, that’s understandable but the domains moved to an account owned by the company? My question wasn’t about bidding on domains on its platform, it was why they took ownership of the domains after the auction.
Let’s look at some more suspicious activity based on whois records for some more pending delete domain names. I included the following domain names to Web.com in my question, if they could provide the reasons for the movements, with most appearing to be auctioned and then New Ventures Services Corp appearing in whois afterwards according to whois records. The above quoted statement was the only one I received from Web:
SXRS.com. The domain was grabbed on the drop (11/13/2016), whois showed a ANDRE HAGEN BJERKE firstname.lastname@example.org (11/29/2016) after the auction, then whois switches to New Ventures Services Corp (4/3/2017), then sold on Sedo 4/22/2017? I didn’t see this one as being sold to a bidder on NameJet but this does show a high bid of $150 http://www.namejet.com/Pages/Auctions/BackorderDetails.aspx?domainname=sxrs.com so it would appear this domain was auctioned on SnapNames?
So this makes me question, what’s happening at SnapNames?
jluz.com similar situation as SXRS above, with same whois movements (not sold yet), now showing New Ventures Services Corp in whois. The whois update showing New V happened the very same day (4/3/2017) as SXRS and KVCP.com? If JLUZ.com and SXRS.com were non-paying bidders or a charge back, why 5 months later that whois changes to New V? Did they buy these domains from the non-paying bidder? Not likely IMO. Why so many changes on 4/3/2017 by domains from different owners, that were auctioned on platforms owned by Web.com?