Should domain brokers disclose renewal fees to buyers?

In case you missed it, last week two well-known folks from the domain industry, Andrew Rosner (Media Options) and Ryan Colby (Outcome Brokerage) had a disagreement, that went public on NamePros last week. The thread seems to have been taken down, but here’s a quick recap of what happened:

Andrew bought a domain name for $5,000 from Ryan, and it turned out that the domain name has a $1,000/year renewal fee. So as you might imagine, Andrew wasn’t very happy about the surprise renewal fee and asked Ryan for his money back. Ryan responded and told Andrew that he was not responsible for telling Andrew about the renewal fee and that as the buyer it was his responsibility. The two had a bit of an exchange and since the post was taken down from NamePros I’ll leave it with this high-level summary.

I personally do think that domain brokers owe it to buyers to disclose critical details like this, period. A premium renewal fee of $1,000+ is quite rare and this is definitely information that as an investor, you would need to know to make a decision. But that’s me, now I want to hear from you.

Do you think domain brokers should disclose things like premium renewal fees to buyers? Comment and let your voice be heard!

{ 17 comments… add one }

  • Anthony Kirlew April 2, 2017, 8:00 pm

    I believe that the renewal fees should be disclosed if it’s outside of what one would expect traditionally ($35 or less). Not everyone is aware that some of the new TLD’s have significantly larger renewal fees. For anyone who is a domain professional, I would consider this as full disclosure. One could say it’s the responsibility of the purchaser, however I also believe that integrity says you take the high road and ensure that your buyer knows what they are purchasing.

    On a related note, I was shocked when I learned that .auto domains renewed at $2,399 per year!

    Reply
  • Domainer April 2, 2017, 8:54 pm

    Yes seller should disclose, even marketplaces disclose if names are IDN’s , no difference here, scammers sell IDN’s all the time in eBay and say buyer should do research.

    What is even more disturbing is the fact that namepros took down the thread?????

    Reply
  • Mark Thorpe April 2, 2017, 9:35 pm

    Domain name brokers should always disclose everything that needs to be told about domain name sales, period.
    But i am surprised that Andrew didn’t already know about the domain renewal fee before he bought the domain.
    But either way, Ryan should of disclosed the renewal fee, even if he thought Andrew already knew about it.

    Something like this should not be happening, especially between two brokers in the same Industry!
    Makes me wonder what end-users are not being told about in some domain name sales.

    Hopefully this will be something to learn from for other brokers, as there seems to be a lot of new domain brokers now.
    I am just surprised this happened between two known domain brokers.

    Reply
  • Michael April 2, 2017, 9:44 pm

    Yes they should .com is $9 a year no one is ever going to understand new gTLD’s a $1000 can get most people a nice .com

    Reply
  • Julio Maysonet April 2, 2017, 10:32 pm

    Personally I do feel it’s the sellers responsibility to say if the domain is registry premium and how much is renewal feel in a sales post.

    Reply
  • Nick April 2, 2017, 11:13 pm

    Without a doubt, intentional or not, material facts were withheld.

    Reply
  • Darko April 2, 2017, 11:14 pm

    The seller should always disclose all positive and negative details about a domain. Especially from a broker I would expect transparency!

    Reply
  • Albert April 2, 2017, 11:35 pm

    All that I can say is “WOW”!!!

    As a real estate broker, I know that I would have had to disclose something like had it been a property transaction (assuming that I knew about it.)

    But then again, Andrew is a domain broker himself and the courts would certainly take that in consideration.

    Having said that, Ryan is a broker, not the seller. So why would Ryan have to fork over $5,000 since he did not personally pocket all of that money.

    On a little different note, I believe that these new GTLD’s are too risky for anyone to invest in or even use.

    I know that’s a bold statement, but let’s face facts:

    1.) increases in renewals are a promise
    2.) scattered use at best, if any

    In other words, you get the picture.

    Reply
    • Nick April 3, 2017, 12:23 pm

      .TV is not a new gTLD. Its a ccTLD (country = Tuvalu) and its been around for over 2 decades. Given all that, renewals on most of the 2-letter .TV names arent $1000 and Andrew knows that. So the assumption would have not been an exorbitant renewal cost. Perhaps Ryan also assumed “normal” renewal rates for .TV also.. Unless we hear from Ryan, we will just be assuming what his position is.

      Reply
  • Jon April 3, 2017, 12:58 am

    Ryan is a broker, his job is to sell and sell at the best price possible. If he were to mention the renewal fees, then no doubt the deal with Andrew or anyone else would be dead before negotiations even started. Only reveal the renewal fee if the buyer asks the question. It’s down to the buyer to do the research and ask the question. Everyone does this. Look on flippa, no one reveals the renewal fees if it’s high. I bid on travel.agency and the renewal fee wasn’t revealed. Good thing I didn’t win the bid.

    Reply
    • Albert April 3, 2017, 10:00 pm

      I agree about buyer bewar.

      But, there are also fiduciary issues.

      Further, Ryan would not be paid if Andrew did not buy.

      So, is Ryan working for Andrew or the seller in this case.

      At any rate, how much is it to renew travel.agency?

      Reply
  • Tauseef April 3, 2017, 2:12 am

    Yes, the rate of renewal should be disclosed.

    Reply
  • Albert April 3, 2017, 2:27 am

    What was the name or, more important, the extension?

    Reply
    • Darko April 3, 2017, 4:22 am

      It was a two letter .tv domain!

      Reply
  • Joe April 3, 2017, 11:42 am

    You’re partly right.

    I think that an expert Andrew should never trust another one of his same market in the same there is much at stake that is money and should have asked for information from Ryan who is a broker and also a brokered with premium domains

    In a domain.Com never in all these years see renewals of $ 1,000, this is different is the gTLD domain name example Xyz renewal can be $ 1000 or more.

    If you do not know which extension to buy Andrew for $ 5000 we will not know the reason for this $ 1000 renewal.

    Reply
  • Albert April 3, 2017, 12:09 pm

    Okay.

    I have to ask:

    When will Mike (from DomainSherpa) have Ryan and Andrew on to talk about this(?)

    Reply
  • Morgan April 3, 2017, 7:43 pm

    Thanks for all the comments everyone. Looking at the 15 comments that I’ve had since writing this post I think it’s safe to say that the vast majority of people do think brokers should disclose this kind of information.

    Anyone want to get up and defend the other side?

    Reply

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