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America.com, thought to be one of the most valuable domain names, has frustrated its owner by failing to sell at auction.

Last week bidding reached just $1.7 million, far short of the seller's expectations. Before the auction there was speculation that America.com would surpass the $12.5 million paid for Sex.com.

The record price paid for a domain was last year's sale of Business.com to a phone directory publisher for $350 million.

The America.com auction was conducted by domain reseller Sedo for an undisclosed owner. Nora Nanayakkara, the company's director of business development said," The fact America.com didn't hit its reserve price belies the fact bidding did reach a huge valuation but the seller understandably has very high expectations for that domain," The Register reported.

"However, sometimes it is just a case that the extent of the paperwork and due diligence required on the part of the most determined buyers is simply at odds with the time left to bid in the auction," said Nanayakkara. "Buying a multi-million dollar domain name is not quite so easy to reconcile on the spur of the moment as buying concert tickets on eBay, even when the business case is rock solid."

Some view America.com's failure to sell as an indication of a global economic downturn.