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Chinese Domain Market Newsletter

For a long time I did not know the difference between schooling and education. I just studied hard, went to good schools, and got good grades. I even received a number of scholarships. After I left college, I finally realized that I was well schooled but poorly educated. Like many Asian students, I only memorized stuff but never digested it. That's the time when I finally started to educate myself. Here's the post.

July 19, 2016 (Tue)

YK.com and future of Chinese domain market


It's in the news! YK.com was just sold to China. Naturally, we wonder who actually bought it. What's the reason of this purchase? And, what does it tell us about the future of the Chinese domain market?

A Whois check reveals that the new owner is 徐俊 (Jun XU, also known as Cai Jun XU), founder of 4.cn. The company name is 多麦 (Duo Mai), which owns 4.cn. The registrant email confirms the buyer is related to 4.cn.

Xu is both a serial entrepreneur and investor. A college dropout, he has founded Duomai.com (ad exchange), Haimi.com (overseas buying for Chinese consumers), and many other internet startups. He is also a successful domain investor, owning many premium names such as Game.com which he purchased for $3.4m in 2014. His domain portfolio is estimated to be worth $100m.

Why did he buy YK.com? The hint may come from what Xu said in an 2014 interview after he acquired Game.com: "I hope I will have the resources to develop it in the future. However, I may be tempted to change my mind if a very attractive offer comes." Game.com has not been developed and is accepting offers. I think YK.com will follow the same path. (You can actually make an offer at https://www.4.cn/buyer/apply-brokerage/DomainName/yk.com.) Xu is both an entrepreneur and a domain investor after all.

YK is an excellent acronym. It may mean 优课 (excellent class), 优酷 (Youku), or 游客 (tourist). Both education and tourism are big money businesses in China. Most importantly, YK stands for Youku, a major video site in China. Youku was listed on NYSE in 2010 and then bought out by Alibaba early this year. It's official website is Youku.com. An upgrade to YK.com will be sensational, just like the examples of JD.com and Le.com.

According to George Kirikos's tweet on July 17, YK.com is the 148th LL .com moved to China in recent years and China now owns 22% of all LL .com domain names. This purchase is the continuation of a trend of Chinese entrepreneurs and domain investors buying up very short .com names.

China is experiencing a startup boom, encouraged by government policies and helped by the internet and mobile phone proliferation. A very short domain name on .com is taken as a symbol of business success and global player. Chinese startups also understand from examples such as JD.com that a good domain name is an investment returning in the form of valuable publicity and reduced expenses in search engine placements. The trend will continue as more and more companies follow the examples of JD.com, LE.com, and many other successful startups built on short .com names.

ps: Look at the address of the YK.com registrant: Zhejiang province. If you are in the business of selling domain names to China, then you need to remember the name Zhejiang. According to the World Domain Conference held early this month, China accounts for 40% of the global domain sales and more than half of it is concentrated in the Zhejiang province.