What is a domain name?A domain name is a website name like google.com or vurg.com or blogger.com. In the early days of the internet all the possible domain names became available on a first come first served basis. Since a domain name requires up to 53 characters and the characters are typically a letter, a hyphen or a number this leaves over 37^53 possible domain names. .COM Domain names typically require a registration fee of $7-$17US per year and so it can easily be seen that there are always more possible domain names than there are those that are registered.
Since everything on the internet that is software based is moving towards getting cheaper and cheaper (e.g. email, hosting websites, voip, etc... ) and the participation rate on the internet is growing faster than most businesses, it stands to reason that the attraction of having the better domain names is growing. Many domain names have been sold for millions of dollars such as Wallstreet.com and others. Good domain names sell high as they attract people who are curious to know who has them and they are effective in drawing people to a site. (Somebody interested in potatoes will be more attracted to potatoes.com than good-potatoes.com) Many well run websites with good domain names reach a point where they are noticed and have huge growth that can attributed to their domain name.
What is the value in 4 letter domain names?There are 26x26x26x26(~450thousand) combinations of possible 4 letter domain names and some people like myself believe that these domain names are a possibly a very good buy. The fact of the matter is that over 75% of the four letter domain names are owned by different people leaving the remaining domain names available for registering. With majority purchased and the trend in domain names that there are more domains being registered per day leaving people to believe that they will run out soon!!
My discussions with different people lead me to believe the 4 letter domains will probably run out within the next 2.5 years. Historically when certain types of domain names run out, they become more valuable. A few years ago a guy bought out all the remaining 3 letter .info domains. At the time people thought he was crasy. Today those who want 3 letter .info domains are willing to pay a premium to get one. This was not a crasy decision. When the 4 letter domains run out those who want them will pay more.
Why do people want 4 letter domains?The fact that they are short makes them easy to remember
Those that are available are often unique and short and unique makes a good brandable term
They often make up a good acronym
They are a potentially good investment
One of the characteristics of short domains like 4 letter domains is that since there are so many, the variability in the value of the domain is reduced. This is a positive thing for investors as they know that they can get a higher minimum value for their domain than other types of domains.
What to do now for those interested.Buy the better 4 letter domain names. Either search through the possibilities and pick the best ones or buy off somebody who has. I have spent large amounts of time finding the better domain names and I sell them at competitive prices. Many of my customers buy my domains and then list them for sale at a higher price.