Domain Appraisal

Warning! The free automatic service for the soon-to-expire domain appraisal has been operational since 1 March 2010 in the test running mode.

Domain Cost Appraisal
Soon-to-Expire Domain Appraisal
Premium Domain Appraisal Specifics
Information for Experts

Domain Cost Appraisal

A domain name, or, to be more precise, the right of use thereof, is, in its essence, an intangible asset which has its value, but has no material content. The domain names, just as any other intangible assets, are used in business and are capable of generating a revenue. As the innovative economy develops, the appraisal of the domain names as intellectual property objects becomes ever more momentous with every passing year.

At present, in Russia there are no officially approved methods for Internet project and domain name appraisal. Therefore, various appraisal companies are applying in-house development practices for domain assessment. As the domain name appraisal methods based on three classical appraisal approaches: profit, comparison and cost-oriented are extremely diverse, automatic domain appraisal services taking into account in the first place the technical domain parameters gained wide popularity.

RU-CENTER, jointly with the leading Russian experts active in the area of the intellectual property appraisal, is developing in-house domain name appraisal algorithm, while relying on the global experience and the results of looking for many years into the Russian domain aftermarket deals. Since March 2010, RU-CENTER has started providing free service for soon-to-expire domain cost appraisal in test running mode.

Soon-to-Expire Domain Appraisal

Appraisal cost of the soon-to-expire domain given on its website is the parameter of the most likely domain name value on the Russian domain aftermarket obtained as a result of the domain automated assessment using a unique algorithm for a domain automatic cost calculation.

The above algorithm has been developed by RU-CENTER experts on the basis of several years' studies conducted into the Russian domain aftermarket, exposing the critical factors affecting the domain name value and developing a system accounting for these factors' "weight".

A domain name value is assessed by the special attendance free software. The appraisal has in its basis profit-oriented methods (domain user traffic availability factor), as well as comparison-oriented methods (automated data collection and processing/analysis on any domain aftermarket sale deals).

There are many factors affecting the domain name cost. These factors allow making a judgement on the potential traffic attraction possibilities. The revenues generated by the domain use can be received in the form of a cash flow due to advertisement placed on the domain, for instance, at the domain parking service.

Among the basic factors which affect to the maximum degree the domain value, RU-CENTER experts single out the following ones:

• aggregate search results (English and Russian domain name demonstration number in the search engine statistics);
• domain entry analysis results (quantity and quality);
• total characters in a domain name; and
• comparable sales within the whole history of observing the Russian domain aftermarket, etc.

Premium Domain Appraisal Specifics

RU-CENTER does not currently provide assessments of the premium domains, i.e. the domains featured by extra attractiveness due to their consonance with the geographic names and directions, proper names, well-known terms, etc. Premium domains also include the domains matching any words in general usage. Their cost is well above the one obtained at an automatic valuation as to their technical parameters, because any such domains, as a rule, serve as a powerful marketing tool.

In a generalised case, the domain cost should be determined proceeding from the effect produced by the domain in terms of the Internet project profit generation or non-generation. The higher the effect, the higher the domain cost is. Needless to say, the above approach is a considerable simplification and cannot be applied for an exact appraisal of many domains.

The application of the automatic assessment methods to the premium domains might yield incorrect results. Using the statistical models for the assessment of any such domains is inconsistent. The deals involving their sales are rare, that does not allow for accumulating the data sufficient for an automatic comparison. Professional specialised appraisal companies should be consulted to determine the value of any such domains. In this case, the assessment is to take into account basic features of a domain positively affecting the demand for it:

• domain name uniqueness from its association and pronunciation viewpoints;
• briefness;
• memorising simplicity;
• associatedness with a business, product, service, etc;
• lack of any domain claims from other companies;
• lack of any punitive measures recorded to the domain in the search engines;
• domain recognisability parameters: Yandex topical quotation index, Google, PR, etc; and
• domain usage area in the past, etc.

The so-called 'single-event domains' should be excluded from the premium domain category. Today's popular news means forgotten domains in the year to come.

Information for Experts

In the recent years, the domain name appraisal has been becoming ever more in demand on the market. It is by far most demanded today in the businesses conducted in the Internet. The domain assessment technologies have been rapidly developing to accommodate the expanding private purpose variety and the domain utilisation situations. The number of the methods and parameters used by the appraisers in their assessments has been on a constant rise. Quite a few of these methods have undergone their practical testing by the licensed appraisers and shown themselves to good advantage. However, the issue related to the methodological devices of determining these or those domain cost types depending on the appraisal objectives requires a more specific treatment.

The domain appraisal algorithm developed by RU-CENTER is protected in the commercial secret mode. At the same time, the algorithm is being constantly improved.
We are open to co-operation with the experts active in the area of intellectual property appraisal.

In any issues related to providing the soon-to-expire domain cost assessment, please, contact us by e-mail at: info@nic.ru.