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Beating a Dead Horse (II): new gTLDs

2011 September 4
by Nat


I don’t expect that the new gTLDs will have a widespread impact.  But they could be successful even if they aren’t widely adopted.

There are different ways to measure success for the new gTLDs.  Even if a new gTLD develops a niche following of no more than 50,000 registrations, this could still be highly profitable for the sponsoring registry.  Let’s assume the start-up costs for a new gTLD are $1 million, and the annual profit margin on the 50,000 registrations is $10.  Then even a gTLDs that only has 50,000 registrations would generate $500k in profit a year, for a recurring 50% return on investment for the gTLD sponsors.  This would be counted as a big success for the gTLD sponsor even though the extension never has more than a small number of registrations.

As a domain investor, I don’t see the need to jump into the new gTLD space.  The key to success is marketing and partnerships, and those aren’t my strengths.  So I’ll leave the new gTLDs to more talented people.

I don’t see a great demand for new gTLDs so my guess is that most new gTLDs will flame out quickly.

Perhaps there are a few uses.  Mayor Bloomberg is excited about .nyc. That could be useful for local businesses to be able to get their exact match domain in an .nyc extension.  Here in Washington, DC, businesses often just add ‘dc’ and ‘.com’ to their name to come up with their domain name.  Tryst is at, Bombay Club is at  Sequoia is at, Hook is at, RIS is at, and so on.  Works just as well and you don’t need a new extension to get a decent domain.  So we’ll see how much demand there is for .nyc.

.me has some adopters, as does .fm, and .info.  I expect many new gTLDs will find their niche as well.

But it depends on your point of view.  A new gTLD could be a success from the sponsor perspective and could have many happy registrants.  But my perspective is as a domain investor.  Since I’m not going to sponsor a new gTLD, I’ll wait to see if any of the new gTLDs are a success in the marketplace before deciding whether I will sink my money into buying any domains in that gTLD.

The greatest potential in new gTLDs is for non-English language uses.  Verisign will use the new gTLD process to obtain .com and .net variations in the major languages, so that there can finally be fully native language .com and .net domains.  This is the one clear and powerful use for new gTLDs.

10 Responses leave one →
  1. September 6, 2011

    excellent post Nat.

    Will you be investing in Verisign’s .com and .net variations in “foreign” languages ?

    Moreover, do you think any of the new gTLDs will get good, quality, traffic ?



    • Nat permalink*
      September 6, 2011

      Hi JS,

      Thanks for the comment. Yes, I will be looking to invest in non-English language domains. It may not be necessary to separately invest in the .com and .net variations. My understanding is that current IDN registrations in .com will be aliased to the new extensions once they go live. For instance, if you own a (chinese character word).com, then you may also be able to alias (chinese character word).(chinese character version of ‘com’) to your existing .com registration.


      • September 6, 2011

        Great, I guess you’ve already begun your research then.

        Good luck


  2. September 6, 2011

    What does the future hold for ICANN’s new TLDs?

    Bearing in mind that ICANN won’t allow applications from individuals or sole proprietorships, effectively ignoring the interests of the vast majority of Internet users worldwide. Add in non-refundable deposits of $185,000 per extension, $500,000 for “integration” plus potentially unlimited annual costs and expenses etc, and how many new TLDs will actually see the light of day? Is this a commercial venture or simply a loss making exercise in vanity?

    ICANN’s main aim has always been to convince Internet users they’re the only game in town and to try and herd everyone into a tiny part of an otherwise infinite universe….but that’s like telling people that the only place they can shop anywhere on Earth is a “convenient” Kroger store in Cincinnati. Yes, the current ICANN Internet set-up may be “convenient” right now, but then some years ago sending a telegram was convenient and sending an email meant inventing the computer (and World Wide Web). So….before making any “investment”, it’s worth considering whether instead of bringing organisations to the forefront, ICANN’s new TLDs will actually isolate you. It’s also worth considering that the Internet is evolving with more fitting and less expensive options coming on-stream.

    Increasingly ICANN finds itself under pressure to modify. The rules have changed and Alternatives are already available; for example as well as “Dotcoms”, there are now free “Dashcoms” (eg: domains like “sports-com” or “happy-birthday”). As ICANN realises that competition is finally at hand, the true value (or the true cost) of their TLD “opportunities” will become all too apparent. Still, look on the bright side, at least ICANN and their associates will have made money from your efforts.

    Disclaimer: Author provides dashcom (not dotcom) domain names.

  3. Fero permalink
    September 10, 2011

    There is very little information about the domains of foreign languages in .com extension , would you buy them ?

    • Nat permalink*
      September 14, 2011

      Hi Fero,
      As I mentioned in my reply to LS above, I am buying some (IDN).com domains. But you are right that there is very little information, there are also many risks and it is highly speculative.


  4. September 14, 2011

    Your understanding that current IDN registrations in .com will be aliased is incorrect. Wants and wishes should never be confused with facts. Maybe yes. Maybe no. Time will tell.

  5. September 14, 2011

    @LS Where can i find anything showing that there is even a remote chance that a registrant other then the same registrant that has the idn.Existing-gTLD will possibly get the transliterated version of that existing gTLD he has the idn registered in?

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