Berkeley, CA (PRWEB) April 3, 2006
DomainMart, a leading provider of quantitative and analytical domain-name services, introduced today a service to estimate a domain name’s liquidation value.
The report points out three important concepts of value: intrinsic, market, and liquidation. In a well functioning market, the intrinsic value and market value converge.
There are two major distinctions between a fair market value and a liquidation value, according to the report. Liquidation creates a situation where the sale must occur within a specific, short period of time and when there are no motivated buyers for the domain name at the fair market price. Thus, the seller needs to offer a reasonable discount to attract buyers. The liquidation value is an estimate of such a discount price.
According to DomainMart’s report, current domain name appraisal models have been developed to estimate the fair market value. The lack of a liquidation-based model is due to the current demand for appraisals being driven primarily by motivated buyers and sellers, and by the nonexistence of a robust scientific approach to estimate a domain name’s liquidation value.
“This is the first scientifically robust model to determine a domain name’s liquidation value,” says Alex Tajirian, DomainMart CEO.
Due to a number of recent litigation cases involving domain name liquidations, Tajirian anticipates a sharp rise in the demand for such a model.
To estimate the liquidation value, DomainMart has extended the application of their statistical classification model, which predicts the likelihood of a sale for a specified ask price. Thus, to adopt the model for liquidation, they reverse the inquiry logic to ask what is the highest ask price that would generate, say, a hundred percent likelihood of sale and the ask price for, say, a seventy percent sale likelihood. Thus, these two estimated ask prices represent respectively the lower- and upper-end liquidation prices.
“The model provides a fair and reasonable estimate of the discount that needs to be offered to motivate buyers to transact in a liquidation environment,” adds Tajirian.
DomainMart is an industry leader in providing domain-name secondary-market products and consulting services, including appraisal, escrow, private investment management funds, protection, valuation, and parking traffic monetization management since 1996.
For more information, visit http://www.domainmart.com/news/Domain_Name_Liquidation_Value.pdf or contact:
Tom Saitori, Marketing Specialist
Tel: +1 (415) 905-4234
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