How is this for a headline?“If The Number ‘5’ License Plate is Worth $6.8 Million, What Is Your Domain Name Worth?”Is it crazy to compare the recent auction frenzy for vanity license plates to the burgeoning domain name aftermarket? According to Traverse Legal, the answer is ‘yes’. I don’t totally ‘get’ the value in vanity plates especially when they are suggesting that a numbered ‘1’ vanity plate would potentially fetch more than ‘sex.com’ sold for. When you compare the potential impressions and reach on a ‘sex.com’ domain name with that of a localized license plate, one has to wonder how these two entities could possibly share a common value? An eye-catching story nonetheless.

Domain names and license plates share some common characteristics. Both allow only one person to own a particular word or number. The supply of good words, vanity words and generic words is finite. Demand for those strong generic or descriptive words is high. Where does supply meet demand on the price curve? Domainers can learn from what is happening in a similar market for – of all things – vanity license plates.The number “5” license plate sold for $6.8 million dollars in Saudi Arabia and another 300 vanity plates sold for another $56 million at last week’s auction. It is estimated that the number “1” will be auctioned next month for up to $20 million dollars.