An auction (or a series of auctions) is fast becoming an important part of any new TLD. .MOBI has used it successfully, .ASIA has done the same, and most recently ICANN has approved the use of auctions both a a tie-breaker for new TLDs (PDF, comments here), and also to profit from fairly distribute one-letter domains (PDF, see p. 18).

Although auctions naturally favor the moneyed classes, they may be the best way to allocate valuable names. Better, for instance, than hundreds of thousands of people jockeying for position in registrar queues, or creating new registrars just for a better chance — methods already used in the .INFO and .EU landrushes, with very poor consequences.

Auctions may be especially useful for community-based TLDs, because you can attach a stipulation to the sale of a particular names. For instance, HOTELS.BERLIN (a made-up example) might come with the requirement that the winner prominently list all hotels (instead of just the advertisers), and include free contact information — thus achieving a public good, that tourists have a reliable location to find and compare hotels.

Of course, the obvious reason to have TLD auctions is that it brings in revenue for valuable names that might otherwise go to a speculator. Not that speculation is bad per se, but an unsurprising 100% of new TLD aspirants think that they could make better use of the funds.

Leaving aside (for the moment) the question of HOW to implement an auction in a new TLD, is the question of WHO is going to do it.

Just as you probably don’t want to build your own registry system, it might be wise to hire out your auctions to people with experience in the area. And, just as with registry operators, there are a number of candidates who have thrown their hats in the ring.

Here they are (see note below):

Sedo
Pool.com
Oversee.net (Moniker and Snapnames platforms)
NameJet

Each of these providers sent back (well, I’m still waiting on one) answers to a thorough questionnaire, which I will publish in their entirety. Instead of the quick-and-dirty answers used in the registry-operator series, I’ve encourage longer responses. This has the bad effect of encouraging marketing-speak, but does have the advantage of providing deeper answers.

First up with my next post: Sedo

Note: There are other auction providers, e.g. Bido.com, who are not candidates for TLDs, because of their business model or inclination. I think I’ve separated these out correctly, but my knowledge of auction providers is not comprehensive. If there’s a company that should be included on this list but isn’t, please let me know in the comments and I’ll get in touch with them.

Posted by Antony in: Domains, Guide to new TLDs