Let the Bidding Begin: Sex.com Domain Name Up For Auction

By: Timothy McFarlin | Published: May 25th, 2010 | Category: Bankruptcy

Domain names have become quite a business. Without having to worry about actually building a site and generating traffic to it, one can simply purchase a domain name then turn around and sell it high—to those in desperate need of the domain. For instance, during most major political campaigns through the past ten years, a few select folks out there have taken it upon themselves to purchase domains with the names of the candidates. Then, knowing there’ll be plenty of knocks on the door with offers, they sell them high to the candidates who know full well, nothing beats the simplicity of “www.yournamehere.com”.

Recently, the California-based Escom LLC and its creditors reached an agreement to sell the highly valuable, “sex.com”. Escom bought the address four years ago for a reported $14 million. It is considered to be the most valuable domain name in the world.

Back in March, the Escom foreclosure auction was supposed to take place and stopped abruptly when three Escom creditors filed an involuntary bankruptcy against them, saying they were owed, collectively, over $10 million.

A settlement agreement filed between both the company and its lenders/creditors said a sale “should occur as expeditiously as possible.” The “sex.com” sale will occur under Section 363 of the bankruptcy code—allowing bankrupt companies to sell their assets clear of liens and other encumbrances.

It will be interesting to see how much the domain will sell for, considering today’s economy. We are four years removed from its initial purchase by Escom. A lot has changed. Who knows, the web address may even be bought outside of America; yet, the notion of selling a domain name, in its own right, seems very American.

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