Monte welcomes Andrew Conru of FriendFinder and Gary Kremin of Sex.com

[Commercials]

Monte: Hello, everyone. Welcome to Domain Masters. Sorry for the late start. Just had to get our first guest on the phone and as I put it on some of the forums, we have the founder and CEO of Friend Finder, Inc., which is Andrew Conru. He's going to be on in just one second. And we're going to talk about the success of FriendFinder.com. It's a huge network of 15 Web communities and over 20 million registered users, so it's a pretty big site. They have lots of domain names and we're going to talk about the successful domain name acquisitions they've made to help their online identity be successful. And the second will be the former owner of Sex.com. As everybody read today, and maybe heard yesterday in the big news, Sex.com sold for between $12 million and $14 million. And we're going to talk to Gary Kremin, who was the former owner of that domain name. It's a famous domain name. It has a hell of a story behind it. And now it's even more famous, 'cause it just sold for a record-breaking domain sale. And so, we're going to have Gary on. I'm not going to be rolling into a commercial since we started late but . . . so I'm going to roll on right with my first guest, Andrew Conru. Andrew, are you online?

Andrew: Yes, sure, here.

Monte: Hey, how are ya?

Andrew: Doing good.

Monte: So, I understand that you started Friend Finder in 1996 and why don't you tell us a little bit about how you got the vision to start an online community like this and a little bit about your background.

Andrew: Yeah. I started the precursor of Friend Finder back in '94 when I was doing my PhD at Stamford and it was just back then there was almost nothing on Internet and I felt this was a great opportunity to enable people all over the world to meet each other and find dates.

Monte: That's great. And so, in 1994 it was just a concept or you actually brought it online in some form back then?

Andrew: Yeah. I had the first online dating site or at least web dates called Web Personals, which then I sold it a year or later. Then immediately when I got out of the non-compete started Friend Finders.

Monte: Wow. Wow. That's great. And so, tell us a little bit about the network, how big it is and what's its doing currently.

Andrew: Yeah. Since the last 9+ years we've grown it from just one site, which was just a single domain name, FriendFinder.com; now we have about 20 different kinds of sites. Each one, there's a separate database behind its own domain name.

Monte: So, give us an example of some of the other sites that are out there. I guess you went into some niche strategies there and decided to hit different areas within the dating community?

Andrew: Yeah. We found that each dating community had their own look and feel and membership. Like one kind of unique one is called Amigos.com, which our Spanish-speaking, Spanish language site. We have another site called Passion.com, which is a more kind of saucier, sexier version of Friend Finder. Alts.com for alternative lifestyles. Things like Out Personals for our gay communities. Sites like BigChurch.com which is for our Christian communities. And we have about 20 other domain names that we use for different sites.

Monte: Great, great. Now, tell us a little bit about your domain acquisitions and how you are able to acquire some of these domain names, 'cause some of them are very . . . what would be considered very high quality premium domain names, like Passion.com, the single word domain names with meaning. Did you go and buy those in the aftermarket? How did you seek them out? Tell us a little bit about what you did there.

Andrew: Well, many are domain names that we bought early, which is kind of a . . . you know, you can't roll back the clock – I wish we could. So we got some pretty deals going after the original owners of the sites, back like five, ten years ago when we purchased some of these the sites were fairly small. Now, Passion was one we did a couple years prior, I think three years ago now, which we bought it the old fashion way, with cash.

Monte: So, what was the . . . like, what was the most expensive domain name that you've purchased in your portfolio?

Andrew: Well, since we're privately owned, we don't necessarily talk about it but we've gone into six figures.

Monte: Okay. And, can you say which name that was for without being specific on the price?

Andrew: Let's see, I'd have to say . . . 'cause sometimes the sites had more than just the domain name on it. That's kind of hard to say whether or not you bought it because of the name or because it had members in it. We did a fairly . . . definitely our biggest one we did was actually a stock purchase that we did for a merger with a company called Cam, Cams.com.

Monte: Right, right, right. That's right. That was something that happened recently, correct?

Andrew: Yeah, earlier this year, we merged the two companies and that was one in which the owner had already had a pretty substantial business behind the site and so it was a natural win for some of the other communities that we had.

Monte: And, Cams is more of a live meet, meet the girls or the guys inside their normal living environments, correct?

Andrew: Yeah, it's more of a pay-per-minute service in which people can pay several bucks a minute to chat with someone on Web cams.

Monte: Right, right. That's great. So, you acquired . . . how many domain names Friend Finder, the whole parent corporation, owns in total.

Andrew: Yeah, we have several hundred domain names. Most of them dating related, you know. Some, you know, are dating unrelated, such as like Dine.com, which is an online restaurant guide site.

Monte: Oh, that sounds good.

Andrew: But that one there I registered back in '94, so it's been a little bit easier to get those ones.

Monte: Right.

Andrew: But its more of a case where we've . . . we've . . . we have some domains where we're doing basically what you'd call domain parking, in which we generate splash pages as a traffic force legion.

Monte: Okay. So for example you would set a site that has a splash page and some content and then feed into one of the 20 main sites or so?

Andrew: Yeah, exactly. One example, if you go to Flug.com, would be a case where we have a majority of our websites that we are able to track or so we're able to promote on a single page and because of the way we track it, we know that all our parked domain names we know what sites promote best for that particular domain name.

Monte: Which site was that?

Andrew: Flug.com. F-L-U-G.

Monte: Okay.

Andrew: That's one example of some of our domain names. We have on our site a domain name called Boredom.com, which I was a bit too uninspired to build a site around it yet, so I just put, parked that on that parking page.

Monte: Right, right. And out of all these sites, how many . . . how many unique visitors you guys generate in a single day or month, just as an example from the popularity of your websites?

Andrew: Well, we're the world's largest network of dating sites. All together, I think we're around 15-20 million uniques per month come to our sites, so we're registering 140,000 people every day. So its been a . . . it's a pretty big company.

Monte: And, membership . . . what's the membership? It costs money to join Friend Finder?

Andrew: It's basically a fairly typical model. People can register for free and then there's upsales that happen after the person joins and mostly done by subscription models.

Monte: Okay, great. And I assume you have a pretty big affiliate network behind this as well, and all the people that have related sites that hook up to you get paid as well so the domain names are of course important to them as well?

Andrew: Of course. One of the things that we've made a big push this year is enabling domain owners to build private labels of dating services using their domain names in which power that person up in the back. One company we acquired early this year is called Spring Street Networks out of New York and they power personals for sites like The Onion or Salon.com or Nerd.com and all these partners . . . all you need to do is have a domain name and we can power the personals behind that in about . . . it takes about 1 day to get someone set up.

Monte: Oh, that's good. So they get set up and as long as they have a domain name, hopefully related to something having to do with dating, you power them in the background and give them what they need to hook up to Friend Finder and then how do you reimburse them or pay them? Through sign-up?

Andrew: Oh, it's done on a rev share, which, depending on how much traffic the domain name is getting, it can get more than even 50% of our money goes directly to the domain name owner and we handle all the back end for them.

Monte: Now, how would one go about signing up or getting their . . . getting signed up to this network? I have a couple people in the chat room asking me already.

Andrew: [laughs] Alright. The company, after we acquired it we changed the name over FatCupid.com, which is on the very bottom of the page there is a link for Affiliates. Now they can also email, they can email us directly and probably the best email to go to is HYPERLINK "mailto:affiliates@fatcupid.com" affiliates@fatcupid.com.

Monte: Okay. I'll put that on the board.

Andrew: Okay, great.

Monte: Now, talk a little bit about the linking strategy again. What can some people do who are not in your business but use some of the same techniques that you've been able to do with your domain names, with your hundreds of domain names out there, that are feeding into your 20 domain names? What are some of the techniques and some of the helpful hints that you can provide to other domainers to help do similar things with their main websites from their sub-feeding domain names.

Andrew: Yeah. I guess the number one thing that domainers needed to be able to do is be able to track the results for each one of their individual domain names. And most domainers have hundreds or even thousands of domain names that they park but they have to figure out what type of sites get the most clicks based on what the traffic or what the domain name is. So if they have a dating related one, they should make to a splash page that has lots of different dating solutions, very similar to the Slap.com type of [inaudible]. If they . . . now obviously . . . if they have a domain name that's not related to dating, they have to make that splash page or that park page to automatically change itself based on performance of the links.

Monte: Okay. And how do you go about doing that?

Andrew: Well, in our case, I guess, if people go to like Slug.com, you'll see that the URL itself has encoded the domain name Slug.com in it so that when people click over to our dating sites from that, we can actually know what is the source of that traffic for that particular partner. And so, as we have . . . we have a lot of domainers who do park their pages on sites like we have the Slug example and then from that we're able to see, well, what type of sites do the members for that particular domain name sign up for.

Monte: Oh, okay, that's good. And then, what about the content part on each of your websites that's having the drop . . . you know, are they, are each of these self-feeding sites indexed in search engines? Are you doing SEO on them? How are they assisting in getting more people to visit them? Or are you relying on just the natural type-in visitor?

Andrew: Yeah. What we found is that while, yes, you want to be able have some extra depth into the splash page, sometimes it doesn't do as much as what you'd think. Like, some are like on Slug.com we don't have a link there currently that lets you go through a directory of locations and types [inaudible] indexed as much as it could. We found that if the search engine hits that site and then goes into the dating sites, you'll still be indexed based on the referring link over to the site.

Monte: Okay.

Andrew: There are ways, there are ways to get search engine placement by having parked domain na . . . parked sites.

Monte: Okay. Okay. And, what other successful techniques can you share with some of the listening audience about your domain name strategy and how you've been successful positioning your domain names on the Web.

Andrew: Yeah. We focus mostly as the contents for these domain . . . for domain names to point to, not necessarily using strategies to promote through domains. So, for example, what we find is that once traffic gets to our dating sites, we're basically working for the domainer directly. So instead of like building up lots of different dating sites or a lot of different domain names, we tend to make it kind of a br . . . kind of a mindless . . . makes it easier for our affiliates or domainers actually promote our sites directly.

Monte: Hmm hm.

Andrew: So its not necessarily we're out trying to build, you know, a thousand different dating sites all under different domain names; we found that it's . . . that our affiliates tend to do pretty well simply promoting the sites directly and sharing the brand of the dating sites that we have. But it all depends on what type of domain name it is. If a domainer has a premier domain name and let's say they don't want to sell it to us, and they want to create their own dating site, we're very . . . we make it very easy for them to jump into the dating space and be up and running and promoting it themselves.

Monte: That's great. That's great. And, what's . . . what are you guys looking at in the near future not only in your business but from a domain name strategy, knowing what's been going on in the whole industry? There's a lot of . . . you know, domain names are a big hot topic right now. Direct navigation is getting the credit for about 13% to 20% of the overall search market right now, which is, you know, typed-in domain names. Tell us what Friend Finders is going to be doing in terms of trying to position itself into the future for additional sites or domain name strategy.

Andrew: Well, we're . . . as it comes to acquiring domain names, we're focusing only on premier domain names and leaving like the second tier domain names for the domainers themselves who are more focused on optimizing or getting money for those domains. So as far as our strategy, our strategy is building quality sites and content behind a premier domain name, so that's kind of our key focus. Actually, a great tool to help make revenue from other domain names but its not one that we're going to be acquiring.

Monte: So, so, from a premier domain name standpoint, when you're saying your looking to acquire a premier domain name so obviously you'd be acquiring this from other people who own those domain names, are you looking exclusively at dating-related domain names or are their other aspects or other niches that you're going to be looking for in the future, so in case anybody that's listening has any one of those domain names, we can possibly hook up some of the domain names that might be of interest.

Andrew: Oh, sure. We're focused on anything that's community-related, such as a block site or a mobile site or a chat type site. So those domain names are obviously easy parallels, verticals, right next to the dating site, so we're always interested in looking at those type of domain names. We've also found, though, as, as . . . we get inspired by the domain names, so given a good domain name, we're always interested in building up a quality site behind that. So while community is key for our . . . community for me means their going to get the most money from us. But we're never adverse to looking at domain names that might be outside that scope.

Monte: Right, right. And what separates Friend Finder from Date.com and Match.com and some of the others that are out there? What are the big differences in your mind?

Andrew: Most of those other domain names are one-size-fits-all, so that no matter . . . like Match.com is kind of like the plain vanilla, dating site out there. It doesn't have a lot of flavor. In our communities, each community is tethered to its own niche, so like people who are into swinging will find what they're looking for and Passion, for example. People who speak Korean will go to Korean Friend Finder and find what they're looking for. So we're much more a niche based system. But that enables us to make sure that the community is properly targeted for them. And have higher conversion rates for our affiliates.

Monte: Right, right. Okay, great. Great news. And, where do you see the overall online, you know, adult and you know, mainstream industries going in the next 1 to 5 years, given everything that's going on? I mean, obviously today, well, you heard about the big Sex.com sale. We're going to be talking to Gary Kremin later. But you know there's a lot of changes and transitions and a lot of consolidation. Where do you see things from your standpoint?

Andrew: Well, we've been around for almost 10 years now. We've seen lots of changes and almost every year, there's always talk of consolidation in the market. And we've seen throughout the last ten years, we've had consistent growth year after year and has actually are doing more than we ever done in terms of traffic and sign ups. We do hope this trend continues obviously. We're looking for this year to do a lot more acquisitions than last year. Last year we completed 3 acquisitions and this year we're on target for about 12. Because we see that right now we have over a half million affiliates promoting all of our dating sites . . .

Monte: Wow, that's a lot.

Andrew: Oh, yeah. It's one of the worlds largest affiliate networks out there.

Monte: Now, is this from all over the world?

Andrew: Of course. Yeah. We have a Chinese site, for example, Chinese Friend Finder or Italian Friend Finder and obviously the . . . based on . . . we rely heavily on the ingenuity of all the different people on the Web. So we found we can do our own promotions, there's no one more resourceful than the people who actually have direct control over their traffic. For example, there are blogger domainers out there; they know that they live and breath every single day of trying to get the most things, most cents per click they get off of their site . . .

Monte: Right.

Andrew: . . . and so we're definitely, we understand there is a lot of advantage of building a big affiliate program.

Monte: Wow, that's great. That's great. So you see, you see just nothing but good growth and everything still building. Obviously, more and more people getting on the Web every day. So for businesses like yours and of course, Match.com has been very successful and of course, e-Harmony's advertising all over television as well and a lot of these sites and people are actually meeting people and finding great relationships online.

Andrew: Yeah. We found a key thing as our company grows and the size of our database grows, the conversion rate of that database, websites, improve. So what we're starting to see is that in the future while there's going to be . . . there's always going to be tens of thousands of dating sites out there, the ones that are going to have the biggest legs are the ones that have the most critical mass and we're seeing that trend continuing as we continue to pull out our [inaudible] some of our other competitor base.

Monte: Well, that's great. That's great.. Well, Andrew, we really appreciate the time that you've taken tonight and you know, the helpful hints on how to link up the sites and make sure that you're measuring where the people are coming from, going to, can be very helpful to everybody that's listening regardless of . . . if they're in the friend finding business or the dating business or just in the domain business in general. So we really appreciate your time.

Andrew: Thanks. And anyone who's listening they can always email us at affiliates@friendfinderinc or any of our sites that we have online.

Monte: Okay, great. Great. Well, thanks for your time and we look forward to speaking with you again and hearing about the more successful stories from Friend Finder.

Andrew: Thanks. Always here.

Monte: Okay, thanks a lot, Andrew. Alright, well, thanks to my guest, Andrew Conru from Friend Finder. Sounds like they been very, very successful on the Web and several hundred domain names, all really funding and filling a major, major portal online; the largest online relationship and dating site on the Web. We're going to break for a commercial and be back on with the Sex.com story. Hang on.

[Commercials]

Monte: Hey, guys, welcome back to Domain Masters and this is going to be the second half of my “Sexy” show. First half, obviously, was Andrew from Friend Finder. My next guest, who I've had on in the past – its been about six months, I'd say, is Gary Kremin. Gary is the founder and CEO of Grant Media, which is one of the largest online traffic aggregation and search companies but formerly, as just a couple days ago, officially, I guess, Gary also owned the famous domain name Sex.com. Sex.com, as everybody remembers, was involved in one of the largest domain theft cases in the entire world and Gary actually one a lawsuit against the former, I guess the thief of the domain name for $65 million and Verisign and Network Solutions had to pay him some money. And now he just sold the domain name Sex.com and so we're going to learn a little bit about the sale. Gary, you on board?

Gary: I sure am. By the way, I'm standing in that former guy's house right now.

Monte: Oh, that's right. So, the last time I had you on . . .

Gary: I'm sitting by the pool.

Monte: . .. you were searching all over the world for this guy and I guess, well, first of all, tell us, just give us a little bit of brief history about what just happened with finding Cohen and . . .

Gary: [laughs] I'd love to tell you; its so funny. He's in jail now.

Monte: So he was, he was found in Mexico or where was he found?

Gary: Yes. And we convinced . . . the authorities saw why it was in their best interests to take him to San Diego where the U.S. Marshall's took him into custody and right now he's in Santa Clara County in Silicon Valley in jail and kind of the main, general population.

Monte: Wow [laughs]. [inaudible]

Gary: [inaudible] . . . Google the word “Elmwood Prison Facility” and look at the fifth link. It's a great little expose on how bad it is there.

Monte: So you ended . . . so you ended up on the winning end of the $65 million injunction because he stole the domain name, so you actually got the keys to his house and whatever property were you able to take ownership of?

Gary: Oh, I'm working . . . some property in San Ysidro, California, which is near the border. He was actually using it to transmit Internet into Mexico. Working on some properties in Mexico. Working on a lot of off-shore bank accounts.

Monte: Yeah?

Gary: So, no, I didn't get $65 million, you know. No way. It's $83 as of today, I think – up to $83 million.

Monte: That's owed to you or that . . .?

Gary: That's owed to me.

Monte: That's owed to you.

Gary: Yeah. But I guess . . .[inaudible]

Monte: [inaudible]

Gary: . . . [inaudible] $85 million I wouldn't be on the phone.

Monte: [laughs] Oh, so, only the fact that you only got well either $12 million or $14 million for the sale of the domain name, which is, I guess, the big news out on the street . . .

Gary: Ahh, what's that? You know?

Monte: Yeah, what's that.

Gary: What's that? 182.

Monte: Yeah, yeah. I know you do, I know you do.

Gary: But, can I give a plug for you guys? Did you know . . . I don't even know if you know this? Those MarchX names, did you notice the registration change?

Monte: No, I did not.

Gary: And they're being hosted with you.

Monte: Oh, great. So you have your . . . you have a lot of your names here at Moniker then.

Gary: 5,000.

Monte: Wow. 5,000 names. Fantastic.

Gary: That's $35,000 to you every year – is that why I'm on the show? No, just joking.

Monte: No, I didn't even know it. [laughs] So there you go. That's called a busy CEO, huh?

Gary: Right. Right.

Monte: So, so. Can you tell us a little bit about the sale that just occurred with Sex.com, because its all over the news obviously and there's a big discrepancy of whether it was $12 million, $14 million, whether there's stock involved, if there's performance quote involved. Can you . . . what can you share and what can you let everybody know about?

Gary: Uhm. Yeah, I'll talk about it. Actually, there's no one really wrong on the numbers. It was a combination of cash, 90% cash and some stock, and it depends on how you value it. And the question is, is stock performance based? Well, in a way it is. Is it like, something else? No. So, actually, everyone is really right . . .

Monte: Okay, so . . .

Gary: It just depends on how you slice it up. I don't know why people are fighting over it.

Monte: Yeah, so its like . . . you know, there's a big debate: well, was it really 12 or 14. To me it was, you know, one of the largest sales ever reported and obviously it's a very important and very important domain name.

Gary: I think the higher sale was Business.com at $7.5 million.

Monte: Yes, yes. And you know, it surpasses that from a public sale standpoint. There's been some private transactions that have actually been in excess of that. But the good news is, is that this has been a famous domain name that you lost, got back, and . . .

Gary: Let me put it this way. It could be as low 12, it could be as much as 20. It depends what happens.

Monte: Okay, great. So somewhere between 12 and 20.

Gary: . . . [inaudible] performance but it was mostly cash.

Monte: Good. Good. So, tell us a little bit about how this particular sale came about and why you decided to sell it after all the famous hype on the domain name in getting it back.

Gary: Well, you're in the domain name parking business, correct?

Monte: Well, that's one of our businesses, correct.

Gary: Yeah, you know something about it. So, what's a domain name really worth? A domain name . . . a domain name is worth one of two things: it's either worth what someone's willing to pay for it; or, its worth [inaudible] what's the value of the type-in traffic? Would you agree with that?

Monte: Yeah, I would agree . . . or a combination of brandability, type-in traffic and you know, with the revenue its generating, yeah.

Gary: Yeah. It's basically, you now, in a lot of cases . . . in 99% of the cases, it's worth the type-in traffic. You now, take the type-in traffic on a yearly basis, subtract out the costs and maybe multiply by 5. That's it.

Monte: Okay.

Gary: That's not an it, that's just what they are.

Monte: Okay. So why did you sell it?

Gary: . . . [inaudible] one penny more.

Monte: Why did you want to sell it?

Gary: Well, because . . . it's . . . it's worth more . . . it's one of those rare cases where its worth more as a brand than as the net present value of the type-in traffic.

Monte: Right. Right.

Gary: I was not doing with the site that this new group is going to do. I was not in any CPA program, for example.

Monte: Right. You were just redirecting at the time.

Gary: To our own . . . to my own advertisers.

Monte: To your own advertisers, right.

Gary: And I'm keeping that business. I'm still in the business of adult advertising.

Monte: So . . . so now that Sex.com is out of that network, how does that affect the Grant Media feed in general if you're monetizing adult names through the network? Does it help it? Hurt it?

Gary: It's only been about 20% of our traffic. Most of the traffic has come in through other type of networks we have and other search engines.

Monte: Okay.

Gary: So, most of our traffic comes from, let's say, we had players that buy ad words on Google and send us the traffic, because we have advertisers that pay more than Google does. Why? Because Google doesn't focus in Adult.

Monte: Right, right.

Gary: When you focus on a very small niche, you can get higher prices than anyone else, because you understand the subtleness of the niche that other search engines don't understand.

Monte: Correct. Correct. So, is the whole network then going to take a little hit of 20%, or are you filling that network . . .

Gary: Yeah. Yeah.

Monte: You're going to fill in the network or your going to fill the network in with other . . . you know, fill it in so its going to make up for the loss of the Sex.com traffic?

Gary: Uhm . . . yes . . . or if not, our advertisers are going to get 20% less traffic, you know?

Monte: Right. Right.

Gary: In giving a penney per click, if you want to give quality traffic, it's always not about volume. You can always generate lots of volume. Its about conversions at the end of the day. So, yeah, we'll work on getting it back in other search engines and stuff like that, but yeah, probably a 20% hit. And that's what it is.

Monte: Right. Right.

Gary: And that's okay. We'll survive it.

Monte: So, so . . . I guess . . . I guess you kind of replaced the Sex.com. You said you just bought four or five thousand domain names from one of our other clients and they're all adult-related, correct?

Gary: [inaudible] clients and you know, that probably replaced, you know, half of it maybe . . . a third.

Monte: Right. So what's your . . . as an owner of one of the most famous domain names in history, what's your outlook on the domain name business in general and what's been going on? Give us just a short spiel on where you see the market today and where you see it going in the near future.

Gary: Uhm, I think its probably . . . I think things are fairly priced in the market for the most part. They should probably be priced if you buy something, you should be able, let's just say its pure type-in, get a 20% return on it, because, in the first year, because there's a lot of uncertainty of what's going to happen in the future, so . . . you know, four to five times cash flow is the most you want to pay for something like that. Anything else is way over.

Monte: Right, right. Which is . . . which is unlike, you know, the actual MarchX purchase of another inventory that was here, where they paid seven-and-a-half times on that.

Gary: But the difference . . . they can pay different as they're a public company and the cost of currency is a little different and maybe they overpaid. Its hard to say. My outlook is 5; and for adult, its even less.

Monte: Okay. And why is it less for adult? Everyone always asks that.

Gary: Because there's no exit route for adult. There's no one to sell your adult company other than to me. You know, or someone else who can write a check. There's not too many people who can write a check . . . who can write a check.

Monte: Right. So in the adult business you're very limited to who you can sell to because you're going to sell to another adult company, obviously; you're all in the same business fighting for the same customers I guess.

Gary: No, no. No. It's different because in non-adult, there's all these stock market companies that are public that you can sell to. And there's literally hundreds and thousands of buyers. In adult, there's only a couple buyers. So, they're just not worth as much in adult because . . . there are people who'll pay 5.1 times or 4.9 or 5.3 or 5.4 or up to 7 . . .

Monte: Right.

Gary: . . . in non-adult. But in adult, if you can get 2, you're lucky.

Monte: Right, right.

Gary: Just because there's not as many buyers.

Monte: And . . . how is the adult business going these days, though, even with the limited . . . you know, even with the focused market that we're in? Do you see it growing? Is the adult business . . .

Gary: Again, I'm just talking about the domain names, now, too. You know. They're just not worth as much because there's not as many buyers out there.

Monte: Right, right.

Gary: Because public companies can't buy them and other people can't buy them because they just . . . just because of all the things associated with it.

Monte: Right.

Gary: Also, the people who pay you on the CPA side are flakier and they don't always pay and stuff like that. So, its just not worth as much. How do I think the adult market is? I think its growing, flat, maybe five, six percent a year.

Monte: Yeah. Well, I mean, sex does sell. More and more people are getting on the Web every single day . . .

Gary: Right.

Monte: What's your take (we've got to end in just a couple minutes) but what's your take on the whole government inquiry into Google on trying to release data on what people are searching on the Web regarding adult.

Gary: Ah, ridiculous. We could be spending the money on other stuff.

Monte: Okay. And, what about . . . what's your take and feeling as a domainer on the dot XXX extension that's now revived itself and due out in third quarter?

Gary: Totally not going anyplace.

Monte: You don't feel it's going anyplace?

Gary: No. I'd be . . . I personally will litigate on that.

Monte: Okay [laughs].

Gary: In fact. I'm the only person who's a trademark in sex.xxx. You can got to the PTO. I happen to actually register it before they thought of the name or they were there and I got in the small window, so as far as I know, my lawyer told me I'm the only one with a pre-empted claim on .xxx. I would love it. But I don't think its going anyplace.

Monte: Yeah. Well, the rumor has it and it sounds like its going to revive itself and be . . . be possibly live in the third quarter of next . . . of this coming year.

Gary: Yeah . . . we'll see. I mean, you know. I think that's going to be extensively litigated.

Monte: Yeah. Yeah, probably.

Gary: I . . . you know . . . that, that's a very complex issue.

Monte: Yes, it is.

Gary: Okay. Hey, any time I can help and shout out to your service.

Monte: Yeah, definitely. Well, Gary, we're . . . thanks a lot for being online and thanks for telling us about the Sex.com sale and congratulations. Sounds like it was a good win-win for everybody all around.

Gary: Thank you very much.

Monte: Okay, thanks again.

Gary: Great.

Monte: Okay, bye-bye. Well, there you have it right from the horse's mouth. Gary Kremin, who owned the name. I guess some people asked how long or how long he picked it up. Gary used to . . . Gary actually owned the name from . . . I believe he got it in 1992 or 3 or 4. It was taken from him in the mid-90's and then it got stolen from him. He ended up in a four year fight to get the domain name back, won a litigation case against Cohen, who was the thief, won a $65 million injunction, plus, rumor has it, that Verisign and Network Solutions had to pay something like fifteen, sixteen million to get . . . to satisfy their negligence in losing the domain and Gary just sold it for, you heard it, 12 on the low end, $12 million and up to 20 on the high end, depending on how the stock and the performance of the domain name does. So . . .

I'm going to end up the show. Stay tuned for Power Source with Tim and Jeremy from Yahoo! It's a great show. It's on every . . . the last Wednesday of every single month, usually, right behind Domain Masters and also, Matt Kuttz is going to be on SEO Rock Stars this next week, so there's a lot of really great people coming some of the other shows on the network. Definitely tune into WebMasterRadio.fm and listen to the shows and thanks for listening to Domain Masters. We'll be live at T.R.A.F.F.I.C. Silicon Valley next week and we're going to do a special broadcast from there or do some taped interviews and launch them on our site for Wednesday. So with that, be the master of your domain. And I'll see you next week in Silicon Valley. Bye-bye.

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