It is bad style to pass a law in the middle of the night – and it stinks

Thursday night, after 11 p.m. (!), the German parliament will discuss an amendment of copyright laws that will harm the Internet as we know it. Some traditional news corporations and their friends in the current government want Internet news aggregators to pay licensing fees to ailing news providers. Making a long story short, they require Google to share some of its profits with them.

So far so bad.

The unintended consequence of this poorly designed policy are disastrous. It will kill one of my dearest projects.  Since 1999, my brother and I have been offering a free news service called, which displays the top headlines of  major and regional news sources. Since then, millions of readers have relied on this plain and easy service.

We play fair. gives users the clear overview they are looking for – and channels readers to the news provider’s websites, without any detour. If this isn’t a classical win-win situation, what is?

Apparently some editors are not content: They want the readers that the news aggregators provide – and money on top. We cannot do this. Our income is hardly covering the server costs, leaving no slack that can be passed on. So if this law really becomes reality, we will have to close down.

In a sense, will be collateral damage in a war between the old and new elites of the news business. It speaks for itself that this law will be on the parliament’s agenda in the wee hours. Shady business thrives at night.

More information here (in German)

Quiet summer: Secondary market for domains slow in July

Trading at secondary domain markets is traditionally slower during the summer months than in the rest of the year. This July was not an exception, as the most recent update for the Internet Domain Name Index IDNX shows: Prices paid for domains decreased by 0.5% compared to June. Total trading volume was slightly lower than in earlier months as well.

Does IDNX spoil the sales pitch to investors? — A response.

IDNX is an excellent benchmark for the domain industry and investors endorse more transparency.

Last week, I had the pleasure of announcing that my Internet Domain Name Index (IDNX) was added to Bloomberg and Reuters. I received support and a lot of positive feedback from the domain community. The overall sentiment is that this is a great step forward in terms of visibility and transparency in the market for virtual space. Nevertheless, some reputable industry heavyweights also voiced concerns, which I would like to address.

Concern 1: “IDNX is based on too small a dataset to be representative”.

The data used by IDNX are one of its core strengths. It is the only index for domains that is exclusively based on market data. In fact, it relies on more than 200,000 real transactions. Real sales are much more reliable than opinions or estimates, since a buyer and a seller not only agreed on a price but also made the trade happen. An opinion only talks the talk—a sale also walks the walk.

IDNX is also very transparent with regards to the underlying data. Unlike many other projects, you really know what you’re getting. The database includes a broad variety of TLDs which represent the distribution of TLDs in the market fairly well. Admittedly, it draws only from sales at, but no other marketplace can currently offer a higher number and a better variety of domain trades. Nevertheless, I am open to and looking for other reliable data sources to have a broader foundation.

Furthermore, I agree that very expensive domains do not occur in the data very frequently, which could indeed mean that the high-end segment of the market is not well represented in the index. But neither are the millions of low quality domains that never get sold. You can compare it to a house price index that is geared towards the bulk of single-family homes: it does not focus on villas, palaces, deserted shacks, but it is nonetheless representative of the market as a whole. The only way to improve this representation would be adding more data on these high-end sales, and estimating the share of domains that will never be sold and that only bloat renewal fees. Asking people for their opinions about price changes of individual domains is not a solution.

IDNX does not calculate average prices but tracks changes in sales prices for individual domains. So returns are not artificially depressed by having the bulk of transactions in the mid- and lower price range. Admittedly, if high value domains rose faster and fell faster in value than mid- and low-priced domains, IDNX would not be a close benchmark for this subset of domain. But as long as the high value sales remain unpublished, nobody can track their prices in a more reliable fashion.

Concern 2: “IDNX makes domain investments look bad”.

Another line of criticism suggests that IDNX discredits domains, showing them as a bad investment with low returns, high risk, and a strong correlation to other asset classes. This perception is dead wrong.

IDNX shows that domains have a solid economic foundation. They are not part of a “new economy” where fortunes can be made without hard work and substantial risk-taking. I trust the majority of domain investors share this perception of the market.

The high correlation of IDNX with other financial indices is also a good sign, since it documents that both real and virtual economy are driven by similar fundamental factors. Common sense and economic reasoning suggest that domains are not detached from the economy in general. Denying a link might sound appealing in a pitch to investors, but the numbers tell a different story. Despite the substantial correlation to other economic sectors, domains still offer a great diversifying potential. Just do the math: even with positive correlations, the overall efficiency of an investment portfolio will increase if domains are included in the asset mix.

Does IDNX suggest that buyers should walk away from domains and search for other investment opportunities? Not at all. For the skilled investor, domain markets offer rich opportunities to prove their adeptness at picking and pricing their assets. With experience, the availability of solid numbers on which to base a judgment, development skills, and a handy bit of luck, money can be made. We will see many more people grow wealthy through domain trading. On the other hand, it is not an alchemist economy that provides money for nothing. The same critical distance that makes us question any of the “make 10K a week from home” job offers in your inbox should be applied to too-good-to-be-true online investment promises.

IDNX increases transparency and accountability

Summing it up: IDNX is a good benchmark for large domain portfolio holders and for the market in general. It is based on a well-documented methodology and good data. It is not only transparent but brings transparency and accountability to the industry. Snake-oil sellers, beware.

News aggregators and news providers are friends, not foes

At last Friday’s NetInstitute Conference, Lesley Chiou presented her paper Copyright, Digitization, and Aggregation. She shows that news providers benefit from allowing their content to be shown by sites aggregating news from multiple sources. Retreating content from news aggregators like Google News leads to significantly lower in depth news consumption by readers and fewer advertisement opportunities for news providers.

I have only anecdotal, but similar evidence from my site, a service that shows the current top-3 headlines for hundreds of newspapers. In 12 years, not a single newspaper demanded to be removed from the site – but dozens asked to be listed.

Domain prices are back at pre-crisis levels: Will the upswing continue?

The February update of the Internet Domain Name Index IDNX shows a continuation of the strong and steady recovery of domain prices. Prices paid for domain names at secondary markets are almost back where they were before the financial crisis left its mark on the ‘virtual land’ values as well.

Domain prices climb back to pre-crisis levels

Will these high prices for domains last? Or is this just a bubble that will bust sooner or later? Dividing the Internet Domain Name Index (IDNX) by the NASDAQ100 or an index for online advertisement revenues sheds light on the relative over- or under-pricing of domains. Long-run ratio between domain prices and stock prices are not “out of balance”. If there was a bubble in domain prices, then it is a bubble not only for domains but for the IT industry as a whole.

Furthermore, advertisement spending in the US outgrew increases in domain prices. Domains are likely to catch up further to reflect this better business climate. Compared to ad revenues, domain prices are rather under-priced and definitely not too expensive right now.

Ratios of Domain Prices over Tech-Stocks or Ad-Spending are not out of balance

Neelie Kroes' explanation on why she believes von Guttenberg to be a good advisor for Europe's "No Disconnect Strategy" strategy

Last week, I mailed Mrs. Kroes, inquiring about her peculiar choice of advisors. I wasn’t the only one taken by surprise, it seems. Please find her reply below:

Thank you for responding to the announcement of my invitation to Karl-Theodor zu Guttenberg to assist me in our “No Disconnect” Strategy. We have had many reactions and some very useful suggestions, but I am not able to respond to each one individually. But I take them seriously, I value the opportunity the Internet gives you to voice those concerns, and I believe they deserve a response.

First, what is most important to me is the No Disconnect Strategy itself. Because my focus is on people who are suffering, and people whom we can help.

My invitation to Karl-Theodor to help me take this work forward is my choice, and it’s about how we can help people who struggle without the most basic rights you can think of. In the past I’ve worked personally with him, and I know he is capable of coming up with and delivering excellent ideas. I also know that we need someone with his international outlook and contacts to help us push these issues forward: someone who understands the highly relevant security and foreign affairs world. This does not preclude other people and ideas from being involved; far from it, I want to build grass-roots coalitions and capacities.

Some of you have already suggested names of activists we should get in touch with: thank you for doing so, we will follow up. I congratulate those who are working in this field, especially those on the ground. There are individuals who are so brave and resourceful, and organisations doing great work. This invitation does not diminish their achievement in any way; nor should it inhibit their work. Part of Karl-Theodor’s role will be to reach out to those people, to ensure that their work gets the proper support and recognition. And so I hope those people are able to share their ideas and experiences.

Second, others have taken issue with actions or decisions Karl-Theodor has taken in the past. My invitation does not mean that I condone plagiarism. I leave him to answer questions about his PhD thesis. But I do know that all of us make mistakes we regret, and that the only way individuals and societies can move forward is through recognition, forgiveness and focussing on good things that can be done in the future. He has paid the price, resigning from all political offices and being stripped of his doctoral degree. So my invitation is about what Karl-Theodor can do for suffering people in the future, not what you or I think about his past.

Meanwhile, one does not need to agree with all his past statements about internet policies while he was German Minister for the Economy. While all serious people share the goal of tackling child pornography, I accept that there are different views about the right way to do so online. And this debate needs to be calm and rational precisely because it is a very emotive topic.

But I hope you would agree this is far, far from the situation that people continue to face in non-democratic countries. These are people whose access to communications networks has been inhibited, blocked or spied on merely to repress fundamental freedoms and silence political dissent. And it is this that will be the focus of his work.

Third, let me clarify the conditions of his position, as I stated on Monday. There is no payment, no staff, no special treatment. He will be providing advice and assistance to me in a personal capacity. We will keep costs to a minimum, and I can assure you I’ll squeeze him for every good idea and every piece of feedback he has.

So I’d like to put this issue in its perspective. Across the digital agenda spectrum, quite a few people already advise and assist me in different areas, on media freedom and pluralism, young entrepreneurship, cloud computing, media futures, and others. People from Germany and across the world; people from all different political parties and those of none. Because I believe in taking advice from a wide spectrum, and linking together the many different stakeholders from different areas of expertise – whether that expertise is in technology, Internet activism, foreign affairs, healthcare or whatever.

So, please see my invitation for what it is: adding one more person with talent to the good ideas and the momentum for internet freedom. Don’t let this one choice determine your overall view of this strategy, nor of the Digital Agenda, nor the European Commission. The world is more complex than that. Judge Karl-Theodor ultimately on the quality of the advice he provides. Judge me, and hold me accountable, for the decisions I take on the basis of that advice.

Kind regards,

Neelie Kroes

Moving to Boston, working for SEDO, researching at MIT

It’s been in the making for a while, but now everything is final: In January, I will move to Boston.

I will work on automatic domain appraisals and price design at (great data, great product, great company) and will be visiting at MIT’s Center for Real Estate. My research will be all about “virtual real estate” – needless to say that I am thrilled about this opportunity.

Seminar at University of Amsterdam

On June 14, I was invited to give a presentation of my working paper on local price dynamics within cities at the University of Amsterdam’s Real Estate Group. The seminar was a great trigger to work on the paper again and to implement some new ideas beforehand (check the latest PDF). But even more, I am very grateful to the feedback provided by Peter Englund, Marc Francke and all other participants of the seminar. I greatly benefited from their discussions, comments and suggestions – UvA, Thank you so much!


On March 25th, I defended my dissertation titled Beyond Booms: Fundamentals and Mechanisms of Housing Markets in Decline.

I would like to thank Maastricht University, my family, my friends and colleagues for making this day a wonderful final chord for my years in Maastricht.

I am very grateful to prof. Franz Palm, prof. John Quigley, and prof. Peter Schotman for serving on my evaluation committee and for their invaluable feedback. The esteemed members of the corona, prof. Yongheng Deng, prof. Antoon Pelsser, prof. Dennis Bams, prof. Stefan Straetmans, prof. Jaap Bos, and dr. Sanstad, are thanked for their time, friendliness and, above all, for their challenging questions.