Devoted to online marketing, viral marketing, and web marketing

The recent announcement about business.com being put up for auction brings some online issues to mind that are worth taking a look at. The online business web directory is projected to auction off from between $300 to $400 million. The domain name was originally acquired for $7.5 million.

The first, obvious value in the company is the domain name itself, which represents a secondary market that's been flourishing somewhat quietly in the backgroud for years. Some people make a lot of money on being resellers of domain names.

What I do like about this particular company is its simplicity. When you go to the site it's just a page that lists a number of categories of interest, which when you click on them give you Google-like search results. It doesn't have any fancy images or video that I have ever seen.

The important part of that is people are still hungry for fast and easy access to information connected to their interests. It isn't too hard to find it. One down side is it doesn't really seem much different than using any other search engine to find what you're looking for.

What it does do is put together categories that are interrelated that someone may not have thought of looking for. That's a helpful feature.

But when it comes down to it, it seems the value of the company is in the domain name in the eyes of the current owners; an online business built around that reality.

The site has also grown a lot since its start in 1999, reportedly reaching $15 million in revenue last year. The visits have also grown strongly since last year, bringing in a little over 20 million visitors for the first quarter of 2007. That compares with 13.3 million the Website drew last year.

I think of MySpace when I see this deal, in the sense that the original owners didn't have the resources to take it to the next level. when News Corp. (NWS-A) bought it, users soared in numbers. This probably will be the reason someone would pay the amount suggested for the company.

The company in its current state isn't worth the pricetag, but there's the element called "good will" that is included in the price of any business. Some of that is related to future growth and potential, which this company has a lot of room for.

There is a lot of things that could be done with this site to make it more valuable. Those that have the resources to do that could make this look like a great deal in a couple of years. They just may get the types of prices being thrown around for this reason alone.

It's the future and "good will" connected to the company that would make it worth it, not the domain name or current services offered.