My best Christmas present arrived early this month:

Knowing how I coveted this vanity Internet address, a dear pal secured it for me the moment its previous owner let its registration expire in the Internet's global address book.

Before you laugh, it's not too late for you to register a zany Internet domain name--or a personal one like a holiday gift. Vanity domain names may seem as faddish as Pokemon trading cards, but they could become the family heirlooms of the future.

I was only mildly surprised when sold for $7.5 million a few weeks ago to a California incubator for an online business center. I watched with interest yesterday as several entrepreneurs tried to match that kind of money by auctioning, and 600 other domain names in a private, 24-hour sale. Their multimillion-dollar reserves were not met.

But I do agree with Eric Wade, one of the entrepreneurs, who predicts that valuations for short, simple, memorable dot-coms are headed higher. "This is only the beginning," he said. "These dot-com names are the Rodeo Drive and Fifth Avenue addresses of our industry. Once they are gone, they can't be replaced."

Wade is a former stockbroker who, for kicks, reserved in the mid-1990s and wound up selling it this year for a mere $1 million. He has joined the new class of Internet name traders who are banking on dot-com names becoming commodities that people buy and sell like real estate.

So far, the nonprofit corporation tasked with overseeing domain names has taken a dim view of speculators paying $35 a year to register names they have no intention of using. Moreover, Michael Roberts, president of the Internet Corporation for Assigned Names and Numbers (ICANN), questions whether rapidly changing Internet technology and faddish marketing trends will allow ".com" names to retain the scarcity that is making them so valuable.

"It's hazardous to make any guesses about the future of the Internet," he said. "Nobody anticipated all this commercial branding activity that sprang up around the dot-coms, and most of the companies that have spent all this money on Internet marketing still are not showing much for it on their bottom lines. So it is really hard to see where this is all going."

Nevertheless, a nascent market for domain names is struggling to be born at dozens of auction sites, including and Most seem to be faring only marginally better than the domain traders on eBay. I watched a Falls Church resident offer on eBay this week and saw no one bid before the auction closed, despite the seller's upbeat pitch: "Great Domain Name. Can be used by cleaning companies, vacuum companies, humor Web sites, or however your creativity leads you." has its share of lame names among the 188,169 it lists for sale. Then again, it also features (asking price: $10 million) and With 30 employees and several million in venture capital, GreatDomains will soon offer appraisal services, automatic auction bidding and listings for up-and-running Web sites. "Two of our founders are real estate brokers. We are using procedures that were appropriate for that market to create a secondary market for domain names," said President Steve Newman.

Competitor is trying to create an open exchange where everybody can see what values are being established for domain names. The idea is to build trust in a shaky industry. "There are no standards, and some brokers are viewed as not very legitimate," conceded Afternic co-founder John Whelan.

Indeed, cybersquatters who snapped up Internet addresses based on someone else's trademark triggered legislation from Congress this year to protect companies from such profiteering. The Internet community was in a uproar more recently about the reverse--call it cybersquishing--in which trademark owners play legal bully against legitimate Web sites using similar-sounding names., for instance, is trying to oust an avant garde European arts group from its home on the Web:

Internet names, of course, are much more than trademarks: They are first and foremost an address system for computers. Each of the millions of computers online has had a number assigned to it, and domain names serve as a human-friendly way to access those numerical addresses.

Companies such as RealNames Corp. are developing new Internet addressing schemes that match "keywords" to domain names, but I suspect they will merely add a layer on top of domain names rather than bypass them.

So far, more than 9 million domain names are registered in the Internet's central address book, including about 6 million ending in ".com." Analysts predict we could see more than 100 million registered names within a few years. Network Solutions, the Herndon company that had a government-sponsored monopoly on registrations until this year, is handing out 15,000 new ones a day.

The name grab frenzy is intensifying now that 98 companies have been approved to compete against Network Solutions, including the user-friendly Smaller competitors are jumping in and trimming prices. Network Solutions has held firm at $35 per name per year, requiring a minimum of two years' payment up front. Network Solutions will offer new pricing options next month and for the first time let people register for a single year. Other countries are lowering rates and simplifying systems for distributing Internet domains.

Skeptics have long said domain names will lose value when ICANN approves new extensions for Internet addresses, such as the proposed .per, .web and .shop. But ICANN is a long way from tackling such a complex proposal. And the longer it takes, the more dot-com marketing mania will put political pressure on ICANN not to open the floodgates.

Think about it. With an unprecedented river of capital flowing into the Internet industry, what motivation would have to create a competing Or CorporateWorld.web?

With that in mind, I reserved a few of my friends' names as gifts this week. I also grabbed, since my family has two Lews. For now, it will help my retired father with his hobby of selling books and maps on eBay. Eventually, my brother Lew might want it for his rock band, maybe when he retires from his own technology career.

Merry Christmas, Lew! Merry Christmas, Dad!

Send e-mail to Leslie Walker at For a guide to registering Internet domain names, visit