This week it was announced that the domain name sex.com, that has had a rather troubled past was, sold for $13 million to a Caribbean company based in the offshore tax haven of St Vincent and Grenadines by the name of Clover Holdings showing that the old adage of “sex sells” being as true as ever when dealing with domain names. Sex sells. has bid $13 million for the potentially lucrative domain name.The sale still has to be approved by a court after the previous registrants went bankrupt on 27 October, causing a long court battle. The sale was brokered by Sedo with about a dozen offers.Should the sale go ahead, it is likely to be the largest reported domain name sale of 2010, and possibly the largest ever. The largest reported sale to date in 2010 is slots.com, selling for $5.5 million according to Domain Name Journal, with gambling probably being the second biggest domain name aftermarket after pornography.Sex.com was last sold for $12 million to Escom LLC in 2006, the company that eventually went bankrupt not being able to make money on their purchase, and according to Kieren McCarthy who wrote a book on the sex.com saga, “has been unable to make Sex.com sufficiently profitable and was overdue on interest and debt repayments.”McCarthy also writes on his blog that “possibly the most interesting thing, apart from the peculiar behaviour of all parties yet again, is that the domain has gone up in price by only $1m in nearly five years.”McCarthy then raises a number of questions, these being:
- does this mean that Gary Kremen got a great price back in 2006?
- does it mean that the value of dot-coms, even Sex.com, is stabilising?
- or does it mean that the buyers kept Escom down to the original price because they knew Escom had no real choice?
While as of yet he is not sure, McCarthy believes it is most likely the third option that has had most bearing on the sale price.In other major sales over the last five years, Domain Name Journal reports the largest reported sale being fund.com, selling for $9,999,950 in 2008 while porn.com sold for $9.5 million in 2007.There have been other large sales that have included domain names over the years, but these have included intellectual property that was a large portion of the sale price. Two of these are insure.com, which sold for $16 million and insurance.com for $35.6 million.The troubled past of sex.com began back in 1997 when the registrant, Gary Kremen, noticed Stephen Cohen had fraudulently hijacked the registration details with forged documents. A long court battle ensued and Cohen won back the domain and a $65 million settlement. However Cohen quickly left the United States to Mexico leaving Cohen with a mansion and small house in San Diego and Tijuana respectively and none of the settlement.In 2005 Cohen was arrested, served a year in jail, but upon release began hacking the page and making unfounded slurs against Kremen.