With more details now out in the open, it seems that NBCU might have had a serious bluff going on with the hand they were dealt while they were out looking for a new name for The Sci Fi Channel. In the end, a small, fan-run website seems to have received the short end of the stick.
Read on, you’ll see why I say that.
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Back on March 16th, I reported that The Sci Fi Channel was changing its name to Syfy. I came out of the gate slinging from the hip questioning this name change. The name change gave them the umbrella brand they were looking for and could expand on, not to mention copyright.
The other facts that were being revealed that day were that they were using a consultant company called Landor Associates and that they had 300 possible names to choose from.
Amongst all the fanfare and angst that was starting to rise up from the seething lines of the Internet, I had noticed that a website I had been reading, called SyFy Portal, had changed its name to Airlock Alpha during this same time frame.
Further digging revealed that SyFy Portal had indeed sold their SyFy brand name to an undisclosed entity.
I also questioned whether they made a buck or two off the this brand name sale?
In short, yes. They made $250,000 to sell their “brand” name to what eventually turned out to be NBC Universal. Sound like a lot of money? Read on.
Michael Hinman, the creator of SyFy Portal, has written an open letter to Michael Engleman, President of NBC Universal, the parent company of the Syfy Channel, and it’s not a glowing congratulatory letter either.
Micheal calls out a quote by Engleman for saying that “with a ballpoint pen and a piece of scrap paper, Syfy was born.“ Huh?
He calls him out because, in fact Michael Himman coined the name 10 years ago for his own website.
He made mention that NBC didn’t approach them directly, but used a shell company called New Fizz Corp to buy the domain name. New Fizz also ponied up for all branding references related to the domain name, such as SyFy, Sy and even Sy.
He’s also miffed that they got away with him selling his long-owned name for only $250K when the real buyer behind the process made $16.9 BILLION in revenue. I’m thinking that he may not have sold for only $250k if NBCU wasn’t hiding behind a shell company. At least I would have tried for more income.
But the idea that NBC hid behind a false front to make this transaction with Himman seems sneaky to me.
Despite being short changed, Michael did say this in his open letter:
“And we are big fans of what SciFi Channel and now Syfy does. We like Warehouse 13. We like Caprica. We can’t wait for Stargate: Universe.”
“And to be honest, we even like you for taking the chance with such a different name, and weathering the short-lived, if not heavy, typhoon of criticism that hit you.”
“But what we don’t like is when you try to drown out the fans. When you try to stomp us out. When you take from us for next to nothing, and then do what you can to make sure we can’t even get our voices heard above the media machine you have created. How are fans supposed to take that?”
He finishes off by saying:
“But to those of us who are struggling to do the things we do … it’s yet another example of how mega-corporations do whatever it takes to make money, even at the expense of the little guy.”
If I were in his shoes, I’d feel ripped off too. Shame on you NBC/U, shame on you.
Source: Michael Hinman’s open letter (I recommend you head over there for a lot more detail on this.)
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51 Comments
The Studios play by they’re own set of rules, and big media spins big wheels…
His complaint is that he didn’t have the information that he would have used to extort money from a large corporation. I don’t feel bad for his greed.
I don’t see the gripe. No one put a gun to his head to sell. He agreed on the price that he obviously thought was fair.
Corporate America isn’t exactly looking out for the small guy, but this guy acts like it was stolen out from under him in a shady deal when he agreed to a great price that is way, way above market value. It just wasn’t enough above market value to him when he found out it was NBC.
It’s not like NBC is using branding he built or his client base he built up over time. They just wanted the name. He kept his client base, will still run his business the same as before and pocketed the excess. Premium names usually goes for about $5,000-$10,000, not $250,000. Take me to the cleaners for 50x market value.
I find it hard to feel sorry for him. He just sounds greedy. He got $250k, got to keep his business and is now generating all sorts of publicity for himself.
He’s probably the same guy who complains when he has to pay for his share of the dinner tab when he goes out with a friend who has a lot of money.
This guy has him pegged: http://www.tvovermind.com/tv-news/syfy-portal-v-syfy-channel-whats-in-a-name/6417
This is called running a business. He sold the name Syfy for what he thought was a good price and what he thought it was worth instead of how much money he thinks he can get out of someone. Boo freakin hoo.
NBC probably knew that if they had approached him directly, regardless of how much it’s actually worth because NBC is such a big name anyone would have demanded a large sum of money. And as we all know, or should know, any increase in expenses by big corporation in one way or another will be passed down to the consumer.
Good play in my book. If he’s so dissatisfied with the 250k I’ll gladly take it off his hands so he’ll stop crying.
@s edward
Nicely said man.
@s edward:
Thanks for that. A very interesting viewpoint. I agree with “that” writer on this entire issue.
I disagree with you S Edward. It’s not about greed it’s about what the site was actually worth. It’s also about what BCU said about coming up with the name themselves. No recognization of the sale or purchase from the original owner of the name and site. That’s not just harsh but borderline deceptive. A shout out to the guy would prpbably have nipped this in the bud.
YOu’re right 5k – 10k is normal for a off brand site name purchase but let’s say you owned Nike.com or Pepsi.com and both of those companies wanted to buy them from you; you telling me that you’d let them go for 250k? I seriously think not.
Let’s say you own a painting, you’ve had it for decades and it’s been passed down from generation to generation in your family. YOu don’t know it’s worth but someone approaches you and wants to buy it. The offer you 250k for it. You think “Wow that’s a lot of money ok I’ll take it.” Later in the news you see your painting on a report about how some art dealer “found” your painting in a flea market or something and it’s a Di Vinci and worth 16 million. Tell me…would you just sit there and say “Oh well, they got me good” No you wouldn’t, you’d be in the press showing pictures of that painting in your family’s possession over the years.
Something to think about.
If the complaint was about theft over the name, then he should have put up a fight or taken them to court. Or better yet, just not have sold the name. But he did. He told the world what the name was exactly worth when he cashed their check. His 10 years of work was worth exactly 250K.
I know that buying it under a shell company is sneaky and underhanded, but that’s big business. They have quite a bit more to pay for and had he known who was really buying the name, he’d have demanded more. If he takes them for the 16B (i’ve lost the number), then who suffers for it? The fans. So his argument is flawed. All he did was piss and moan over the money in his letter.
I doubt he was as committed to it as he says he was. It was about the money and his own greed. Plain and simple.
Yea gang, anyone could have done anything different – my motivation was focused on how this process was done from NBC’s side.
But as you’ve said, it’s big business and that’s how they do things. From behind the brow of their hat, hoping you don’t see them coming.
I can understand both viewpoints but I just keep thinking: What did/do the native Americans think about the Europeans buying Manhattan Island for less that .01% of it’s worth? Were they hoodwinked or did they just make a bad decision?
@Paul Young:
And most people would say that you should have done some research in the painting before selling it.
Call what NBC did underhanded, but the guy was foolish for letting a domain name like that go for 250k, no matter who the buyer was. There are plenty of services out there that can help you appraise a fair market value for a domain. He didn’t bother to use them.
He also obviously thought that the last ten years of his work was only worth 25k a year. Again, that was a chance for him to do an honest appraisal of his efforts, and he obviously thought that was a fair price. If he thought it was worth more, then he should have asked for it.
You shouldn’t change your price based on who is doing the offering. You should honestly evaluate what it is worth to you, what it is worth in the market, and then set a price. If the buyer can’t afford it, such is life. But to say you got ripped off once you realized the company that wants it has billions of dollars at their disposal is bull.
Actually, take that back. You did get ripped off. Not by the company, but by your own actions. And so you have no one to blame but yourself.
I also believe he’s just whining because he could have stuck it to NBC/U more if he knew they were well, NBC/U.
I don’t like the analogy of the painting for this, because in that case, the owner of the piece could have said ‘let me have this appraised first’, but instead sold it cheap.
@ S. Edwards: Thanks for the link, it was a good read.
@ Bruce: If you haven’t read the article linked, you should.
Sure, NBC/U was likely trying to get out of the deal with a fair price (instead of it getting inflated) AND to keep the name change on the down-low. I mean heck, I just put in ’syfyportal.com’ in my URL and it went to….? Airlock Alpha. NOT syfy.com. So not only is NBC/U not using it, they are forwarding traffic to Mr. Hinman’s new site!
I did Evie. Thanks.
It does make great points. I based my first response around that article because I was writing not towards the decision Michael made, but how it was done to him.
Since I have not been in the position of being offered a lump of money for the websites I own and run now, a lump sum that would make the next few years of my life seem like easy street, I can’t talk to any perceived mistakes the Michael made.
We’re all fantastic arm chair coaches on most anything, and I’m not knocking anyone for it. It’s what humans do, whether it be in business, entertainment or sports.
Heck, even after some decisions I’ve made in my life, I made the best decision I could at those times, with what info I’ve had. Looking back on them, knowing now what I do now from my experiences in those situations, there are a few that I’d love to go back in time, slap myself upside the head and say, WTH ARE YOU THINKING!?
It’s not always as cut and dry on one side of a scenario, as it is once you’ve pushed through the “event horizon” of the choices made.
Everyone here are making great points and thanks to all for chiming in. We like seeing what everyone has to offer on the issues at hand.
Sorry … I keep forgetting that blog comments don’t allow me to quote like I typically would when there are no other options to do it.
So if what is said above doesn’t make sense, I wish I could edit it.
But I did copy before I submitted, so Bruce, if you wish to remove my first comment, I am replacing it here:
His complaint is that he didn’t have the information that he would have used to extort money from a large corporation. I don’t feel bad for his greed.
I’m sorry, greed? If you put the house that you own on the market, and you get four offers for it, are you going to take the lowest offer, or the highest offer? And if you sit and wait for a higher offer, are you going to accuse yourself of trying to extort?
If you had something that belonged to you, and someone offered to buy it. Say you created DOS, for instance. The financial value to you is really light still, but for someone like, say, Bill Gates, it could be worth millions. He comes in and buys it for a few thousand dollars, and instead he makes billions.
Who in that scenario is extorting who?
One issue I have about talking about all this with fandom is that we all tend to think about this in context of our own lives. Even I do that, because hey, in the end, I’m just nothing more than a fan.
However, a transaction like this — especially with a multi-billion dollar company that was looking to exploit this mark to brand a division that is making hundreds of millions of dollars per year — is much different.
If I came to you and convinced you your house was worth $50,000 when in actuality it’s worth $500,000 — tell me who would be screwing who.
Corporate America isn’t exactly looking out for the small guy, but this guy acts like it was stolen out from under him in a shady deal when he agreed to a great price that is way, way above market value.
I’m sorry, you’re a trademark/brand appraiser? I’m just asking because you just indicated the sale was “way above market value.”
Market value is set by buyers, not sellers. If I want to buy your house, and you don’t even have it for sale, it is up to me as the buyer to look at what I think the house is worth and make an offer.
It’s not like NBC is using branding he built or his client base he built up over time. They just wanted the name. He kept his client base, will still run his business the same as before and pocketed the excess. Premium names usually goes for about $5,000-$10,000, not $250,000. Take me to the cleaners for 50x market value.
Premium names? What are you talking about? What brand has ever been sold for $5,000?
We’re not talking about a domain name here — I am not sure why I have to keep explaining this. This was a BRAND SALE primarily, not a domain name sale. A domain name was included, but was not the crux of the sale.
I find it hard to feel sorry for him. He just sounds greedy. He got $250k, got to keep his business and is now generating all sorts of publicity for himself.
He’s probably the same guy who complains when he has to pay for his share of the dinner tab when he goes out with a friend who has a lot of money.
I find it amazing that I am commenting here where right in bold letters above this box says “no profanity or personal attacks.” Without you ever meeting me or anything to that effect, how would you know how I would react to dinner or the like?
Even before this sale, I would always be the one spending money, no matter how much more wealthy my companions were. That’s just the way it is.
If you wish to disagree on something you obviously know very little about, that’s fine. But the attacks on characteristics personally about me that you don’t know about is uncalled for.
Never once have I asked for more money from NBC. The only reason why we talked about the price and did a comparison is because there were claims that I received a lot more money than that, and that I should just clam up about creation credit because they paid a ton of money. The idea was to show tha they didn’t. The actual price that would’ve been negotiated if all parties had identified themselves at the table would be closer to $2.5 million. That’s not a gouge or anything else … it’s just a better appraised value based on the buyer and potential plans that we would have to try and determine on our own.
It’s the way business works. While shell companies can be used to try and stop from being gouged, many times their primary purpose is to allow major corporations — especially public ones — to underpay.
The discussion in the column that prompted the piece on this site was talking about the fact that we had defended the tactics used to acquire the name and even the price — IN SO LONG THAT THEY GAVE PROPER CREDIT TO ITS CREATION.
In terms of the TVOverMind column, they have printed a lot of incorrect facts, and made incorrect assumptions, which you seem to be doing here.
I fail to comprehend how people can speak without having anywhere near the details needed to form an opinion. And instead of asking, just make assumptions and end up coming off as mean-spirited.
Good play in my book. If he’s so dissatisfied with the 250k I’ll gladly take it off his hands so he’ll stop crying.
Once again, there is no “crying” over the price outside of the fact that if you read the column, the MAIN CRUX of it is creation credit. Everything else is just to explain that yes, I have a right to demand creation credit, and that any discussion of how much was paid (that some think should have me keep quiet) is not enough to keep me quiet about it.
Credit is credit. Those who run businesses and deal with intellectual property and have been doing it successfully for years understand this. And I hope you continue to listen to try and understand it as well.
A shout out to the guy would prpbably have nipped this in the bud.
That is correct. Before I wrote the column, I had been doing everything I could to get NBC, and even my regular contacts and liaisons to return my call. The issue was PRIMARILY with the fact that Michael Engleman did two interviews with Variety and Fortune, and in each one either made implicit or explicit that he created the name and that he was the first.
I am not saying that every time NBCU uses the name that they have to mention me. But if they are talking specifically about the origin of the name itself (not their branding strategy or anything like that, but the actual name), they can NOT just sit back and claim they were the creators of it. It’s simply not true.
That was the ONLY issue in this entire mess. The talk about money was to bring up that I have not publicly complained about how the deal went down because I felt the trade-off in the liquid exchange was me being able to say I created a name now used by a major network. When that credit looked to be stripped away, then that trade-off no longer was viable.
NBCU finally reached out to me after the fact, and are actually very good people. We have worked with NBCU for many years, and continue to enjoy a great relationship with them, and we have since resolved the issue. But yes, if they had simply responded when I first reached out, none of this would be discussed right now.
YOu’re right 5k – 10k is normal for a off brand site name purchase but let’s say you owned Nike.com or Pepsi.com and both of those companies wanted to buy them from you; you telling me that you’d let them go for 250k? I seriously think not.
And one thing just to point out (and a very good post, Mr. Young, thanks!) is that this is NOT a domain name sale. This is a brand sale.
It’s not like someone bought Pepsi.com from it … they are actually buying the Pepsi name from me. It’s totally different, and cannot be compared to typical domain name sales, because it’s not a domain name sale. A domain name was included, but that was only to further secure the brand purchase.
If the complaint was about theft over the name, then he should have put up a fight or taken them to court.
Except it wasn’t. The complaint was that NBCU was claiming to have created something original — the Syfy name — when even if they independently created it, there is more than enough evidence that we have used the name for more than a decade in a very similar branding scheme.
While there could be some actionable elements of what NBCU did in these interviews, there was nothing we would immediately even consider taking NBCU to court over. We have a good relationship with NBCU, and we depend on each other (more us depending on them than the other way around, obviously), and a lawsuit that is not well-thought out or absolutely necessary would not be anywhere near the list of options for us.
If this matter had not been resolved, we would’ve taken this matter to a different court — the court of public opinion. Of course, I would probably have to explain myself a lot better than we have over the past few days, because this is a very complicated situation, and a lot of misperceptions and information circulating that is not even true or accurate.
I know that buying it under a shell company is sneaky and underhanded, but that’s big business. They have quite a bit more to pay for and had he known who was really buying the name, he’d have demanded more. If he takes them for the 16B (i’ve lost the number), then who suffers for it? The fans. So his argument is flawed. All he did was piss and moan over the money in his letter.
I know exactly what you’re saying, and when I was asked about this a number of times by reporters last March, I said that I understood why they did what they did, and if it were me, probably would’ve done the same thing.
However, it goes both ways. Sure, they didn’t want me coming and asking for $250 million. But then it wouldn’t have gone anywhere, and NBC likely would’ve gone another direction.
But if we had known it was NBCU talking, we would’ve been able to consider better what possible uses they might have with the name, and develop a much more fair price: Probably closer to $2 million to $2.5 million. Even then, we’re still talking about a very minor expense to obtain an established brand that would now become their primary brand.
So yes, shell companies are good because they eliminate gouging. But at the same time, shell companies are good because they can convince sellers to part with property for far less in value.
So if you want to defend them for preventing gouging, I hope in the same breath you attack them for using it to underpay. Both are very fair statements to make.
Wouldn’t you feel that a good faith negotiation is when both sides, at the very least, know who they are? Or is it OK for the seller to be at a disadvantage, because the buyer knows who the seller is, but it’s not vice versa.
It’s not illegal, but just because it’s not illegal doesn’t mean it’s a practice that should someday be addressed by lawmakers.
And you’ll be on board too, someday, when someone tries to buy something you’ve created, and uses a shell company to prevent you from realizing true value.
I guess you have to be a victim of it, or a potential victim of it, to understand. Screen Rant understands where I’m coming from all too well. It might just be the type of discussion only people like us could fully comprehend the ramifications of.
Thanks for letting me comment. Unfortunately, between Airlock Alpha and the upcoming launch (hopefully next week) of our TV news site Inside Blip, as well as Comic-Con next week, among all the things I normally have to do, I don’t have a lot of time to really go into all the details of this like I would typically engage in.
However, if there are any new thoughts or comments, I will try to keep up and answer them. If I don’t, and you would really like an answer, please e-mail me at mhinman@airlockalpha.com.
I wanted to thank Bruce for a great write-up (Which I would’ve said if he agreed with me or not), and unlike two other blog sites that wrote about this over the past week, actually got all the facts correct. I appreciate that!
@ Mr. Hinman: Although I cannot really say what I would have done in your situation, I can’t help but wonder a few things.
Did you ASK THEM what they were going to do with the name? I mean, if some company called ‘News Fizz’ came to me and negotiations went all the way up to a quarter of a million dollars… I know I’d be suspicious of their motivations and would have dug into it a little more.
You said there was a contract that went to legal. Was it stipulated in there that you were to be given credit for creation of the name?
Of course you or anyone else does not have to justify their feelings on the matter. All this kind of thing does is start a massive ‘he said she said’ debate that could be endless with no real resolution being reached.
BTW, thanks for bringing Airlock Alpha (formerly SyFy Portal) to my attention. It is now in my daily bookmark of places to go to read my entertainment news (as I am partial to SciFi entertainment).
I really think that the “hey this guy is just being greedy” folks just don’t have a grasp of what it’s like to be in this arena. And I’m surprised to hear the “business is business” argument as well.
Micheal and Paul are absolutely right in both of their points: NBCU wasn’t just buying a domain name, they were buying a brand – BIG difference. And Paul’s artwork example is a good one as well IMHO.
I’m far away from being anti-corporate or having the “all corporations are evil” mentality (quite the opposite, actually) but there are ethical ways to go about doing business. Sounds to me like arguments above could be used to defend Enron and AIG, no? It’s just business, buyer beware, etc., etc.
As to the “do your research” part – did you read how much SyFy Portal brought in annually prior to the sale? How much money does a “regular Joe” have to sink into expensive lawyers to do research on something like this? And you’re also looking at it in hindsight – sure, NOW it’s easy to ask why he didn’t do his research – but why would it even occur to Michael that there was any subterfuge going on? If someone approached me to buy Screenrant, the last thing I would expect would that the company I’m negotiating with was a front for a mega-corporation.
If YOU had a property to sell, would you maybe approach the sale differently if a local mom and pop store wanted to buy it as opposed to Wal-Mart? How would you feel if you thought you sold it to that little mom and pop store but it turned out Wal-Mart had bought it and purposely hid their identity?
I’m preparing to sign a contract here at Screen Rant to join an advertising network – I’ll do as much due diligence as I can, but if I get screwed because I can’t afford to pay a lawyer thousands dollars to go over a contract with a fine toothed comb and to investigate the company and I end up getting screwed, are you all going to come down on me like a ton of bricks?
This all just reminds me of people who criticize those who run companies but have no idea of the responsibilities, time commitment and stress involved – because those doing the criticizing worry about nothing more than doing their daily job (not to say that job isn’t important, but it’s ONE thing) and collecting their paycheck. To them it’s all very simple, but I assure you, it’s not. I work closely with the president and CEO of my “day job” and I assure you that they EARN their keep.
Heck, you wouldn’t believe what’s involved in just running THIS site as far as behind the scenes work… that’s why I rarely even write for it these days.
So you might cut this guy a little slack while you’re being envious that he made $250K.
Vic Holtreman
Owner/Editor-in-Chief: http://ScreenRant.com
bottom line, he sold the name for $250K because that’s all he thought it was worth. whether a big company or a small company was buying it or not, in his mind his domain was only worth that much, so he sold it for that much. this sounds like “crying over spilt milk” to me.
@Vic: I understand what you are saying about the bait and switch, but I maintain that if someone was willing to pay a quarter of a million dollars to buy my name. I’d want to know why. For all I know Mr. Hinman DID his due diligence as far as investigating who News Fizz was prior to signing the contract, but from what I have read so far, he hasn’t communicated that fact. Additionally, I don’t see how you have to be a lawyer to do investigative research.
And I also maintain that he simply could have included in the contract itself the caveat that he would be given credit for coining the term ‘Syfy’.
Perhaps Mr. Hinman is guilty only of being a trusting person. And you know you cannot have that attitude in any business, much less entertainment. Maybe I’m less willing to give him the benefit of the doubt because I’ve had to perfect the CYA with my own career (to the best of my ability) so that if something like what happened to Mr. Hinman happened to me, I’d only have myself to blame.
Unfortunately, this is a lessen learned. I, and others hopefully, thank SR and Mr. Hinman for reminding us of this fact and this article will probably help others when they come across similar opportunities.
One point that hasn’t been made is that there were probably other names on NBC/U’s list, and if Michael Hinman hadn’t sold or tried to play hardball with the price, they may have moved onto the next name and someone else would have gotten the money.
Another point is that the SyFy “brand” would only be worth millions of dollars if it was one of the most visited sites on the Web. NBC/U is going to literally spend tens of millions of dollars in advertising and promotion (admittedly through “free” ads on its TV network, but a third-party advertiser would have had to pay tens of millions of dollars) to create a “brand” from the new name. NBC/U has already made a big splash and has gotten a lot of free publicity from the name change. Without the promotion, SyFy Portal was just an obscure Website that only sci-fi fans knew about.
This whole issue reminds me of producer Sam Phillips selling Elvis Presley’s contract to RCA for $35,000. Everyone says he was crazy for selling Presley for so little, but Phillips didn’t have the money nor the organization to make Elvis a national star. Phillips sunk the money into Carl Perkins’ song “Blue Suede Shoes” and made that a national hit. But he couldn’t have done it without the RCA seed money.
Another example is when you sell your home. If your home is worth $250,000, is it worth more if a celebrity buys it? Well, a lot of people think so, which is buy celebrities use buyer-brokers. But really, it doesn’t make the house worth more.
The only time the domain name, or the “brand name,” would have been worth more is if a company had already named itself and then went out to buy the domain name. For example, the search engine AltaVista had been calling itself that for years until it decided to actually buy the AltaVista name. Price for that was a million dollars, and the company that owned it actually was relieved, because their website was getting a million hits a day, which was costing them money.
Candy.com just changed hands for $3 million, but we’re talking about a really hot name, and thousands of people a day were hitting the site despite the fact there was only a placeholder page there.
I think $250,000 was a really good price for an obscure name and Michael Hinman should continue on and make Airlock Alpha the best Website he can.
@Dan Zee
Exactly what I was thinking you just said it better than I would have.
Bottom line
Mr. Hinman made a choice to sell. He made money on the deal. It’s OK to be upset. Morally what NBCU did was atrocious, but business wise it made total sense. The person you should be upset with the most is yourself.
DAN:
They said they had 300 possible names to pick from…
Et Al:
You have got to stop equating this to home selling! That is such a different beast… A home can’t be over valued when no comps exist for a like structure within 2-4 miles, regardless of who buys it.
And almost to a tee, every single person I’ve helped buy or sell a home always felt like they could have made a better deal. But they don’t because the bargaining table is an interesting place that mucks with your mind.
Period. It’s like Poker and the better bluff wins.
And I can’t say if I were offered a quarter million, if I’d question it. really, you would? I think if you were in the middle of this kind of scenario, it would be different.
INK: Exactly!
All good points though, regardless of my rant!
Okay, rejoining the debate and there are a bunch of false assumptions out here (especially after reading Clarissa’s article.)
First, NBC didn’t buy a brand. The brand was worth relatively nothing. I know this because my own website is many times bigger than his and makes more money and MY brand isn’t worth that much. His brand isn’t worth very much.
NBC didn’t buy his brand, they bought a NAME that they could transfer their branding on to and own.
If you run an internet business like I do (not that successful BTW,) you actually have to do balance sheet accounting for brand value and I guarantee you this guy didn’t value his brand on the books for 250k.
NBC bought a name, not a brand.
This guy actually got to keep his brand and make it more valuable.
Companies with deep pocket always use fronts so that they aren’t gouged based on their name and can negotiate at relative market rates.
This isn’t underhanded. The seller still got to pick a price he was comfortable with. He negotiated back and forth and came to a price he thought was fair… and… far above anything he’d been previously offered.
Sure if he knew NBC needed the name he could have held them hostage for more money, but NBC rightly took that out of the equation.
He was able to value it independently and received a price far above his previous offers. Good for him. He did well.
Here’s where his thinking logic falls apart.
1. He assumes NBC bough a brand… they didn’t. NBC could generate 100-times the brand equity he built in an hour with one announcement. NBC is not using his brand equity. He had no brand equity that NBC cared about. His brand equity, though big from our perspective, was nothing in the scheme to NBC. They just wanted a name they could own.
2. He believes he’s entitled to more than fair market value because it’s NBC. Look, if I’m selling my house and a rich buyer comes in and outbids everyone by a huge amount, I’m happy.
And that’s what happened here.
Only a jerk thinks, “Oh, I could have got so much more money out of them.”
3. It’s not anyone’s right to charge the value of the property that could be used by someone else unless they know that.
Their value is what they feel they’ve put into it.
And they were obviously were tickled with the price vis-a-vis their input into the site to that point.
4. It’s not sneaky to withhold deep pockets from any negotiation, just common sense, as that will ultimately skew the view of the fair value of the site. In other words, if someone knows this information the will, because they’re greedy too, use it to extort more money from he process.
This guy got a great deal and is now publicly trying to get more publicity for his site on top of that. He didn’t lose anything, he gained hard dollars in the worst economy in decades, got to keep his business and up his profile tremendously.
He’s in an exponentially better position than he was a year ago thanks to NBC. He’s just upset at the opportunity cost of not being able to use NBC’s deep pockets against them.
His attitude now is exactly the attitude he’s accusing others of. He wishes he had the corporate knowledge exploit a situation, exactly what he’s claiming happened to him.
Talk about hypocrisy. Ugh.
Well, it seems to me, from Mr. Hinman’s comments, that this has been resolved.
Sorry for typos. The hypocrisy is that this guy wishes he had the knowledge to act as if he were a big company. He wants to be what he’s accusing them of. Just be happy someone gave you more money than anyone else had previously given you in the worst economy of our times.
No wonder people are unhappy, they look for reasons to see how they lost. This guy won more than most of us internet schlepps will and still is building his original business bigger and gaining notoriety.
It’s the best thing that could happen to him and he’s complaining as if he were entitle a a share of NBC’s corporate profits.
Coming where I’m coming from, I wish I could get ripped off the same way.
Finishing up and moving on. Credit is another weak argument. You got 250k worth of credit. If you sell it, that’s the value you placed on it. The bottom line is that no credit would be necessary if NBC weren’t looking for something they could own. If you want credit for SyFy you should have kept it and built it. You and I both know you would have never got any credit if that happened because you’re not big enough to have an impact. That’s just how it works.
You got paid out and negotiated that payout and it was higher than you were offered before. I just don’t see the “Wa” factor.
Just whining because you think you could have got more: recognition/money/etc. is just selfish and greedy.
You had the option to stick it out on your own and see if you could get those things, instead you sold out.
Happens all the time.
You got a price you were happy with to sell out. If you didn’t want to sell out, you shouldn’t have.
This just seems to damn simple and unfortunately pretty good example of entitlement thinking.
Best of luck to you.
It is possible that Sci Fi came up with the name, then realized someone else owned it. So they hired a branding firm to create something else, didn’t like any of them and then decided to buy Syfy.
As others have said, NBCU had no obligation to make sure Syfy knew its buyer had deep pockets. When you walk into a store do you announce, “I’m rich so you can charge me more!” NBCU was watching out for its bottom line and apparently $250K was a good price to Syfy at the time. This guy should stop crying.
Okay class….
What have we learned here (All what ifs and legal jargon aside…)?
1. This above all else…to thine own self be true.
2. The big fish in the pond often becomes bait when introduced to the ocean.
3. Jealousy breeds contempt.
4. Money is the root of all evil…(Unless we have more than the other guy…)
I love this site because ALL opinoins are voiced and considered here, and the “regulars” more times than not make the blogging even more compelling than the original post by way of feedback and interpretation. My only reservation to that statement is directed towards those who would ridicule someone they don’t personally know. I don’t feel that its EVER appropriate to involve character assassination or harsh judgments of a person’s integrity while excercising your right to post an opinion.
Great post, Bruce! Keep up the good work.
Props to Mr. Hinman for having the stones to answer (without rewturn flaming…) those who brought his MORALS into question. I wish him nothing but future success and hope that we all actually learned something from his situation.
@nowhereman
Here here! Except it’s “The love of money is the root of all evil”, not money itself.
Look out for yourself in business deals is very valid and obvious.
Money isn’t the root of all evil, it’s a way to value things. Greedy people tend to want more than their value.
I don’t think this guy was bait at all. I think he got a very good price. He could have got more if he new the real seller, but that doesn’t change the fact that he thought the price was right.
The only contempt is for whining about not getting more money after the fact as if he were somehow taken advantage of. That makes legitimate claims less powerful.
I’m thrilled he got the deal he got and if he got a million I’d be thrilled for him as well.
Good for him, he just shouldn’t be trying to make a big deal out of this.
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