Sedo’s experiment with IDNX is interesting but the thing is, the domaining industry has certain particularities which make the job of someone who is trying to create a domain price index almost impossible.

Let me try to explain why:

Each domain is different, it’s not like with gold for example where anyone can say things like “why should I pay you 2x more when I can buy the exact same thing at a lower price somewhere else?”.

If you’re a mechanic from Chicago, you can’t just tell the owner of ChicagoMechanic.com “sell it to me at $x or I’ll buy BostonMechanic.com which is listed at a cheaper price”… to a mechanic from Chicago who wants the best possible domain, the fact that BostonMechanic.com would be available at a cheaper price is irrelevant because he has no use for it.

Oh and it’s important to understand that there different types of domain sales, so you can’t just analyze everything as a whole. Some domainers never sell at reseller market prices, so for that specific transaction, quoting past similar sales that occurred between resellers would be pointless.

In other words, as a buyer, quoting past reseller market sales during the negotiation process won’t help your case one bit if you are dealing with a seller who never sells at reseller market prices.

As a conclusion, trying to create a domain index can be an interesting experiment (it can generate publicity for the domaining industry as a whole which is great) but for many reasons such as the two I referred to in this post, I don’t think we can ever have a domain price index that’s as relevant as those that exist for other types of assets.