There are many uses for domain names, both active and passive.

1. Domain names can be used to establish a unique identity in cyberspace
Companies often choose a domain name that corresponds to their company name. For instance, IBM's web site is at ibm.com and Microsoft is at microsoft.com.

	People who register domain names that are or contain common trademarks belonging to other companies are known as cybersquatters.  BEWARE: there are more and more cases of large companies winning back the rights to "their" domain names - and in some cases cybersquatters have faced very hefty fines (US law currently provides for up to $100,000 in damages if a cybersquatter is found liable of deliberately infringing a trademark)

2. Generic domain names are popular
A generic domain name is one that would not immediately be associated with a company, but instead is a name that defines an entire category of business. Some examples of generic names include books.com, music.com and art.com. Companies have gone on to create successful brands based on a generic domain name, and these names tend to be very valuable if the word is a common one.

3. Domain names can be resold, leased and bartered
As well as being used to identify a website, domain names can be resold to other companies or people, leased or even bartered for other names or for goods or services. A whole industry has sprung up around the resale of domain names, with domain brokers acting as middlemen in the sales process. The profits from a successful sale can be enormous compared to the original value of the name, since some domains have sold for over $1 million - and cost under $100 to register!

However, there are many more sellers than buyers, and the market for domain names is still relatively immature, making it difficult to locate a potential purchaser for a given domain names. There are also too few quality names, so that they often get buried in a mass of worthless listings on domain brokerage sites. If you want to dabble with making money from domain names, go ahead and speculate... but don't expect a quick return unless you have picked some exceptionally good names!  THE MAJORITY OF DOMAIN NAMES ARE JUNK AND HAVE NO COMMERCIAL VALUE!

4. Domain names can be used to give yourself a unique, permanent email address
Many companies will set you up with email forwarding, where messages sent to @yourdomain.com will be redirected to your existing mailbox as provided by your ISP. This lets you choose a truly unique email address and keep the same email address regardless of which ISP you use to access the Internet.

5. Domain names can be used to improve a site's ranking in certain search engines
Although the rules by which search engines "rank" sites when returning search results change often, some search engines have recently been favouring sites with their own domain names over sites that do not have a domain name of their own. Some search engines even give increased relevancy to domain names that contain "keywords" that people search for. For example, a search engine might rate a site with the domain name "freestuffguide.com" more highly than a site with the domain name "freebieguide.com" for the search "free stuff" since the former domain name contains the search terms being searched for.

Time to finish this introduction with a look at why you should consider buying a domain name...

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