Private equity firm Apollo Global Management will take Rackspace private in the all-cash deal.
The retailer will not say if the letters stand for Amazon, Kindle and Zappos.
Amazon.com Inc. has bought the domain names A.co, K.co, Z.co and Cloud.co from .co Internet S.A.S., the registry operator for the .co domain.
Amazon did not say how much it paid for the domain names. However, when Overstock.com bought the O.co domain name last June, the retailer said it paid $350,000.
While presumably the purchases represent shortened versions of Amazon.com, Kindle.com, Zappos.com and the retailer’s Amazon Web Services business, Amazon, No. 1 in the in Internet Retailer Top 500 Guide, has not committed to how it will use the domains, says Lori Anne Wardi, director of global communications for .co Internet S.A.S. As of Wednesday morning the domain names were not yet active. Amazon did not respond to a request for comment.
Overstock.com has said that single-letter domain names offer a unique branding opportunity. Other businesses that have acquired single-letter domain names include Twitter and GoDaddy.
“Single character .co domain names are increasingly considered to be strategic acquisitions by brands seeking a competitive edge in the escalating battle to attract, engage and retain customers online,” says David Taylor, a partner at the law firm Hogan Lovells who heads its domain name practice and assisted in the acquisition. “While starting out as shortcuts to help Internet users access products and services more easily, over time such domain names will likely be leveraged in new and exciting ways.”
Domain names are often sold via an auction format; .co Internet S.A.S., however, says it is taking a different approach by reserving a number of domains—including single letter and two-letter domains, and somewhere between 1,500 and 2,000 other domains, including Cloud.co—for businesses that present the best use cases, says Wardi.
That approach could reduce the chance that speculators will horde potentially lucrative domain names. .Co Internet S.A.S. developed that mindset after it auctioned off its first one letter domain name, E.co, for $81,000. “It was purchased by a investor, not someone who planned on developing the name and as a result that domain remains undeveloped,” Wardi says. “We don’t want to see that. We want to see these domain names used in a massive way. Otherwise it isn’t worth it to release these valuable resources.”
.Co domain names are increasingly valuable, she says, as businesses increasingly market via Twitter, which has a 140-character limit, and mobile devices. “We now live in a world of 140 characters and if a retailer can share a short domain name, they’re not wasting space,” she says. “And, as more people become mobile device users, the shorter and quicker they can get access to their destination, the better.”
.Co Internet S.A.S., which began making .co domain names available to the general public last June, says it expects to have 1 million .co domain names registered by July. .co is also the country domain for Colombia, but the government of that South American country has made an agreement with .Co Internet S.A.S. to license .co for general use. There are 21 top-level domains—such as .com, .org, .edu, .gov—and some 250 two-character country code domains, such as .uk, .fr and .cn for the United Kingdom, France and China.
Scot Wingo, ChannelAdvisor CEO, and Colin Sebastian, Robert W. Baird & Co. analyst, will speak at the Internet Retailer Conference & Exhibition 2011 in a session entitled “How does Amazon do it? An in-depth look at e-retailing's pacesetter."