Via namage.com
Frank Schilling, one of the world's largest domain name registrants, recently posted some general traffic statistics for his portfolio and claims between 7 and 20 visits per second across all 300,000 domain names he owns.
Doing some rough guesstimating, I figure he is averaging something like 14 visits per second on average. Now that we have this basic number to work with, we can establish approximately how many visits in aggregate Frank receives, how many visits per domain, and also the revenue per visit he is generating.
14 (visits per second) x 60 (seconds per minute) x 60 (minutes per hour) x 24 (hours per day) x 365 (days per year) = 441,504,000 (visits per year)
Now, these are probably not all unique visits, but as the majority of Frank's sites are not particularly sticky (simple 'parking pages'), I would guess that less than 20% of his visitors are return visits, leaving 80% of them as unique.
Therefore, Frank is probably getting somewhere in the neighbourhood of 350,000,000 uniques per year (or around 30,000,000 uniques per month).
This is basically on par with the traffic claims of some of the other major players in the industry (ie. Geosign before the arbitrage collapse, Marchex, etc.).
If Frank has 300,000 domains under his belt, that means that per day, he is averaging between 3 and 4 unique visits per domain (350,000,000 visitors / 300,000 domains / 365 days) - not as many as I would have thought.
It has been reported that Frank does $20 million in annual revenue, therefore he would be averaging approximately 5 cents per unique visitor ($20,000,000 revenue / 350,000,000 unique visitors) - again, less than expected.
So, it would seem that the real key to Frank's success is simply scale. There are hundreds or thousands of people out there generating more revenue per unique visitor, and there are lots of portfolio holders that generate more than 4 uniques per day across their portfolio - but there are few out there who are doing either on the same scale as Mr. Schilling does - especially with so little work or cost.
At $6.75 or less per domain, the cost to maintain Frank's portfolio would be approximately $2 million per year. Mind you, he did pay more than that for many of his names - at the minimum, a $60 fee through the expired domain name brokers and more likely, many of thousands of dollars in auctions or from private sellers (he recently paid $4,100 for RumCakes.com for example).
He would also have some bandwidth and server/administrator costs, but this is probably under $200,000.00 - hardly noticeable in the grand scheme of it all.
Although the price of domain names continues to rise, I still believe the space is tremendously undervalued, and I believe it would be very wise for wealthy individuals or corporations to invest heavily in acquiring premium, generic domains with type-in traffic - as Frank writes regularly on his blog, for a couple of billion dollars, you could buy up a huge swath of the world's most visited domain names and control more traffic than the largest websites, while having next to no expenses and millions of properties with resale values that are increasing at a greater rate than any other asset type on the planet.
