Business 2.0 magazine’s December 2005 issue features an article on inveesting in domain names and their monetization through direct navigation traffic and ppc advertising systems:
The secret? It has to do with what’s known as type-in traffic, or, in Wall Street jargon, direct navigation. Though it may seem odd in the era of powerful search engines, it turns out that millions of Internet surfers don’t use search at all. Instead, they type what they’re looking for right into the top of their Web browser.
The article indicates that venture capital companies are also starting to enter the market:
Boston-based Highland Capital paid $80 million to acquire BuyDomains, a company with 500,000 names, according to people familiar with the deal. Says Highland principal Richard de Silva, who wouldn’t confirm the price, “These are profit machines.”
While the size of the direct navigation market is open to speculation, Business 2.0 reports:
No one knows for sure how much Web traffic comes from type-ins, and Google and Yahoo execs won’t discuss it. But privately, during one of the late-night parties at the Traffic conference, one Yahoo official estimates that type-ins could make up 15 percent of its search business. Marchex, a Seattle-based public startup whose strategy rests largely on type-in traffic, estimates that it accounts for nearly 10 percent of the global paid search market, which is projected to soar from $9 billion this year to $23 billion in 2009.
You can read the excellent article, written by Business 2.0’s Paul Sloan, on the magazine’s website by clicking the following link:
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