technology

It’s success .ai as domain trade rakes in big bucks


OpenAI CEO Sam Altman posted “chat. com” on X without explanation earlier this month. It subsequently emerged that HubSpot cofounder and CTO Dharmesh Shah had sold the domain to OpenAI, indicating that the $15.5 million price may have been paid in shares.

While Shah seemed to suggest the amount was the same he’d paid to acquire it in the first place, domain investing is again becoming a lucrative business that could yield high returns, following the rise of AI. Web domains with .ai extensions have become the third-largest selling category, with sales reaching $9.2 million in the year to date, according to data from Namebio.

This is slightly behind the second-ranked .org, which garnered $9.4 million. The extension .com still rules, at $120.2 million.

The domain you. ai was sold for $700,000. Other top-priced domains included stack. ai, sound. ai and girlfriend. ai, selling at $140,000 to $259,000.

Screenshot 2024-11-18 002228ETtech

Registrars such as GoDaddy allow investors to buy, sell or auction domains that have a high probability of being acquired for a substantial value.

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“Starting in late 2022, GoDaddy saw a notable increase in the number of .ai domain name registrations as a company–a trend that spiked in May 2023 and continues to drive strong interest,” the company told ET.

Interestingly, .ai is a country domain name assigned to Anguilla, similar to .us for the United States, .uk for the United Kingdom and .in for India. The Caribbean island country has decided to capitalise on the popularity of .ai and opened registrations to anyone, much like Colombia did for .co, GoDaddy said.

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“Domain investing has been a niche of many internet enthusiasts who treat it like an asset class,” said Neil Shah, founding partner at technology consulting firm Counterpoint Research. “Just as one buys real estate in anticipation of its price appreciation amid infrastructure development in a city, similarly, domain enthusiasts register new domains during a technology revolution like AI.”

Legal rights

The practice of cybersquatting, widely prevalent during the early days of the internet, doesn’t necessarily work as well now. A Delhi-based developer who owned the jiohotstar.com domain had sought Rs 1 crore from Reliance Industries to fund his higher studies. Given that Jio and Hotstar are already trademarks of two unique entities, Reliance declined the offer.

Meanwhile, the Dubai-based siblings who purchased the domain name from the developer have now decided to transfer it to Reliance “free of cost,” underscoring how this kind of cybersquatting may not end in easy money.

“Domain investing and trading is a smart business model if you don’t infringe anyone’s rights,” said Ankit Sahni, partner at Ajay Sahni Associates, who specialises in intellectual property litigation. “But in case of disputed domains, companies can retrieve them from cybersquatters by submitting a complaint to NIXI (National Internet Exchange of India), which oversees domain disputes for extensions .in and .co .in in India.”

Among the recent domain dispute resolutions by NIXI are wikipidia. org. in, mahindratractor. in, saintgobain. net. in and tatacliqfashion. in etc.

However, these challenges are not always straightforward. “Domains comprising of generic or descriptive words, for instance myapple. com, if used by a bona fide fruit trading business, may not be claimed as one that infringes the trademark of the technology company Apple,” Sahni explained.

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