Likelihood of Success

Ron Coleman’s pretty good blog

Petty taxes

Posted by Ron Coleman on October 17, 2007

Marty Schwimmer prints an excerpt from this story, about a guy who wants to buy a domain name to start up a new business, but can’t afford the $1000 for the name he wants and which is being warehoused by a domain seller. The would-be buyer doesn’t even counter-offer — why not? He probably could have gotten the domain for under $500 if the starting price was $1000.

The domain seller feels guilty. Writes Marty, “This is an illustration of how the domain name system sometimes function as a tax on small business.”

I guess. A little tax is still a tax. It doesn’t seem “fair” — but in fact, the person who registered that name first got the real estate precisely because he recognized the domain name’s future value. I can’t fathom a small business that doesn’t have $1000 for the “right” domain name that has any chance of succeeding, considering that most small businesses fail precisely as a result of a lack of capital.

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