NetQuote.com Just Became the Highest Price Ever Paid for a Domain Name at $40.9 Million Beating Sex.com

Aug 23 2011

Some are going to immediately scoff at the price as merely an accounting price, as NetQuote.com was a fully functioning business and not just a domain name.   But if you go over the SEC filings of Bankrate.com‘s recent purchases you’ll see that that of the $92 million paid for the company,” Approximately $92.0 million was recorded as intangible assets consisting of Internet domain name for $40.9 million, customer relationships for $46.0 million, and developed technology for $5.1 million.”.   So officially, the $40.9 million allocated for the domain crushes the old record price of $13 million paid for Sex.com.

There were several other names purchased by Bankrate that now make the top ten according to their allocation of costs for the domain name as a percentage of purchase price.

CreditCards.com $26.5 Million

CarInsurancequotes.com $7.5 million

Bargaineering.com $2.7 million

So now brings up the big question. Can a domain with a business behind it be counted as the highest price paid for a domain or does there need to be new rules.  Sex.com had good revenue as well and officially was a business and a domain name.
Although I’m no accountant, I assume there is a reason they put certain value on the domain name as an asset but what keeps a company trying to use the purchase as publicity by saying they paid 99% of the purchase price for the domain and the rest for the business?  Well, other than the IRS.

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Outsmarting the Dumb, Outworking the Smart

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10 comments

  1. dcmike77

    Gimmie a break.

    I’m no longer reading your blog with that type of non-sense for a headline.

    It’s clearly just an tax benefit, not to be confused with the actual cost of the name to the company.

  2. owen frager

    And if a headline read Bank spends $92 million for lifetime advertising everyone would be saying “what a steal.” Well domains like these are lifetime advertising!

  3. Elliot Silver

    “I’m no longer reading your blog with that type of non-sense for a headline.”

    Damn… wish I had done that myself 😉

  4. Adam

    RE: the myth of lifetime advertising ? I’ll let you advertise and shout out your message, play your jingle, put on a song and dance in my forest out in the middle of nowhere for the lifetime of your business for $92million . . . what’s that going to get you in ROI ?

    We’ll likely never know why they chose these specific values as part of the overall transaction but clearly with names like netquote and bargaineering there’s much more to the BR valuation numbers than a pure domain.

    Would you pay 10% of the value they placed on those domains if the company went bust and there was nothing but those domains left ?

  5. Eddie

    Great headline! It’s a good lesson in copywriting. The content is controversial so it’s a good lesson about blogging.


    1. Post author
      ShaneCultra

      Snoopy,

      I always forget. You make the calls on nonsense and sense. It’s been a while since I had your negative ass in the comments and had to be reminded.

  6. Troy

    “Nobody is going to buy this nonsense.”

    Shane, please post your paypal address. I would like to send you $1 to buy this nonsense.

Comments are closed.