Strange and Beautiful
JUST GOOD FRIENDS by RayMorris1, on Flickr. This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.
Beautiful is domain renting,
Lessee and lessor I see smiling.
In mutualism they both are thriving.
If You Cannot Flip it, Rent It!
If you let Burger King build their store on your idle lot for rent, why not do something similar with your idle domain?
Burger King by a n i. Y., on Flickr. This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License.
In my previous post, Domain Flipping – Flip it Like You Mean It I talked about domain flipping as a possible viable business. Domain flipping is buying domains and selling them quickly for a profit. It does not require a large capital and can potentially make you lots of money fairly quickly. There are situations where selling the domain may not be easily reached. In these situations, domain renting might be a good alternative.
Why Would a Sane Person Want to Rent a Domain?
I do not know. I am not a sane person. Though, that is a valid question. Why would anyone in his right mind want to rent a domain when buying or registering a domain for yourself is inexpensive and can easily be done?
An excellent domain name can make or break a business. Let us suppose you own a new business. With the perfect domain for your business, tons of traffic can be easily directed to your business and thus potentially propelling your business to success. What if that perfect domain is already owned by someone else? You contact the owner and ask if you could buy the domain. Naturally, for such a golden domain the selling price the owner would ask for it will also be golden. Because you are unwilling to pay such a golden price for the fear of being unable to see your return of investment should your business not succeed, you buying the domain might not be practicable. Entering into an agreement between you and the domain owner that will let you use the domain in exchange of a reasonable monthly rate might be a win-win situation for the both of you. You get to test your business while not committing to a major investment and the domain owner gets to receive continuous income while not giving up his ownership to the domain.
The Strange Part
Strange is domain renting because it is a relatively uncommon internet phenomenon. If you come to think of it, domain renting should not be strange at all. Domains are analogous to traditional, brick-and-mortar business addresses. It is not strange for a business address or location to be rented out. In fact, your slick office with a breath-taking view of the metropolis where your digital butt stays glued all day might very well be just one of those properties which companies rent to call them their office. What makes domain renting a bit strange is the fact that what is being rented cannot be seen or touched and if I may correctly say, abstract. Because you cannot see or touch (or lick) a domain, you begin to wonder if the lease agreement for domain renting is going to be the same as the one for traditional rental properties. The domain rental lease is just like any other rental lease – or is it?
From Poet to Lawyer – Lease Agreement
From that little poem at the beginning let us now put our lawyer shoes and be a lawyer. Let us focus our attention to the lease agreement. What are the things the lease agreement must contain? I have questions about the lease agreement that is very important to be addressed so as to avoid getting into trouble should unexpected events happen in relation to the lease.
- What will happen if the lessee wants to continue leasing the domain after the stated term? Does the lessee have the option to continue the lease? If yes, what provisions will apply?
- Does the lessee have the rights to purchase the domain? If yes, when can he buy it and at what price?
- What will happen to the rights of the lessee if the lessor decides to sell the domain to another party during the term of the lease? Does the lessee have the so-called, right of first refusal?
- What if a third party wants to buy lessee’s business? Can the lessee assign or transfer his rights in the agreement?
These are just some of the questions which are important to be addressed. If you cannot address these questions, it is alright. Did you really think those shoes can transform you from poet to lawyer? Come on. In that case, it is imperative that you consult a real lawyer and have these kinds of questions addressed in the agreement.
Domain renting can be a good alternative to domain flipping. Some of the important issues regarding domain renting may not be properly addressed by a traditional rental agreement. Care should be exercised in forming the domain lease agreement. Consult your doctor lawyer.
