I've gotten two requests from Moniker to lower the reserve for table.com, the first from my sales rep, and the second from Monte Cahn, their CEO.

It was fun to correspond with Monte, who's sort of domain space royalty (between his companies and the Domain Masters online radio talk show).  But this reserve lowering stuff is a disappointment -- I chose Moniker in part because I felt Domain RoundTable was pushing me towards too low a reserve. 

I'm beginning to  get the uncomfortable feeling -- from my experience and anecdotal evidence -- that everybody does this.  Reserve lowering may just be a consequence of the form of the domain market and how the major auctions do business. 

Domain sale information is asymmetric.  Above and beyond the possibility that the auction house may have better price expectations that the average seller, they certainly know more about the number and quality of potentially targeted buyer prospects who will be attending the auction than the seller does, which is not in their interest to share.  They know more about their negotiations with multiple sellers than the sellers know about them, so they are in a better position to negotiate their wishes into reality.

The auction house has several incentives to ask everyone to lower their reserves (regardless of whether the price is right), so that it can get credit for any "bidding wars" that occur, and so that it can market its auction to more paying attendees.  Secondly, a lower reserve minimizes the risk that the auction's domains won't sell.  That's a big risk for an auction that limits, but less so for a seller who is willing to wait for the right buyer.

On the other hand, domain exchanges probably do know more about the most likely sales prices than many domain sellers, who from first-hand experience I can say frequently have unrealistic or inaccurate expectations, so in some cases this is really a valuable service for all involved!  Since domains don't typically sell a bunch of times in quick succession, it's hard to say.

What do you think?