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New gTLDs Will Affect *All* Portfolio Owners

Posted on 15 April 2014 by Andrei

Now sure, the “super premiums” probably won’t be affected but let’s be honest, not even the best domainers have portfolios that consist only of amazing domains. Pretty much everyone has “so-so” domains and it’s precisely those domains that will be affected by new gTLDs.

Let me explain why.

Put yourself in an end user’s position and let’s assume you want to buy a great insurance domain.

Now of course, Insurance dot com would be your number one choice, no question about that. Even new gTLD operators will agree that the category killer dot com is definitely the best choice.

But how many end users could afford Insurance.com?

Not many.

The result? They’ll have to settle for another domain, let’s say YourInsurance.com.

Here’s where things start getting complicated because what if that person has a choice between let’s say YourInsurance.com and Insurance.web at similar prices?

Deciding between them would definitely not be as easy as deciding between Insurance.com and Insurance.web, not by a long shot.

And YourInsurance.com is actually a good domain, definitely not a medium or “so-so” one.

What if the choice would have to be between YourInsuranceOptions.com and Insurance.web?

Now if I’d have to choose between YourInsurance.com and Insurance.web, I honestly don’t know which one I’d pick but if I’d have to choose between YourInsuranceOptions.com and Insurance.web at similar prices, I’d pick Insurance.web without even blinking.

So there you have it, this is the point I’m trying to get across.

Will the owners of category killers such as Insurance.com be affected by new gTLDs? Probably not.

Will the owners of good domains such as YourInsurance.com be affected? Probably.

Will the owners of medium/mediocre/so-so domains such as YourInsuranceOptions.com be affected by new gTLDs? Definitely!

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7 Comments For This Post

  1. Ron Says:

    Your wrong as most category killer names are being gamed or reserved in sunrise, you would be surprised how few options end users have. If a term is taken, it is taken, and back to square 1.

  2. Savio D'Silva Says:

    I previously thought that domain investors and end users would benefit from most of the new gTLDs but now I have been observing that most registrars are cunningly keeping almost all major keywords reserved for themselves or to sell at ridiculously high prices. The registrars seem to making money since some fools are willing to cough up thousands of dollars for these new domain extensions. However, in the long run, dot coms will once again be the main attraction since registrars cannot afford to manipulate a market as big as the .com.

    On a different note, it’s much easier to reach page 1 of major search engines (for long tailed keywords) with any aged, high DA website. I’ve seen most major websites are ahead of most generic keyword domains both on Google and Bing with just a standard page written about the topic. Quality matters most at the end of the day.

  3. Brad Mugford Says:

    I have a different take on things…

    Most end users who are interested in new gTLD are going to want premium terms. The problem is virtually no premium terms are on the market as they are either on the ICANN collision list or are being hoarded by the registry. Basically the registries are only willing to offer crap terms for reg fee.

    The handful that are available come with premium prices and premium renewals. Not only that but the whole process is confusing – you have renewal fees that vary widely in the same extension.

    I can see an end user wanting a top term like Wedding.Photography, Car.Insurance, etc. for the right price. However, if available, they will not be cheap.

    So the choice comes down to if you want to be cheap you can register a .COM/NET/ORG for under $10 a year. Most of the reg fees in new extensions are $20 – $50 a year.

    However, if an end user does decide to pay a premium then I expect
    the majority to go after moderately priced quality .COM and ccTLD vs. some obscure extension with no awareness.

    Brad

  4. Domenclature.com Says:

    Andrei!

    WOW. In March, you covered Domain Industry Fallacies, which you described as “… basically an argument that isn’t backed by sound logic or a logical error/mistake, if you will”. It’s only April, and you’ve committed all 8 errors -in one post: Middle Ground, Cherry Picking, False Dilemma, Straw Man, Red Herring, Ad Hominem (by insulting dot com), Non Sequitur, and Appeal to Authority.

    You just launched a new project, Megasites.com, why didn’t you wait for Mega.Web?
    *

    Crickets

    *

    Why are you still using .com for your blog?, and most importantly, why is Berkens not using his The.Domains?

    *

    More Crickets

    *
    Why are you speaking about these news gTLDs in the abstract? They are here now. At least one set of end-users are aware of their existence, the domainers. How come no blogger, or domainer is using the new gTLDs? Will all consumers listen for a whistle, and then dive in? Or will folks start using it a trickle at a time? What gTLDs have you bought? An article like this should cite some examples.

    Comparing “yourinsurance.com” to “insurance.web” is improper.

    When will people start using the new gTLDs? Over 500,000 has been sold, almost 100 extensions launched.

    *

    Crickets

    *

    When dot co launched, even Elliot Silver developed Bahamas.co!

    So, we’ve got end-users in the world today, we’ve got new gTLDs available now for over 4 months, they’ve been in the making for 10 years, when will they spark? Give us an idea.

    No, YourInsuranceOptions.com will NOT be affected because it’s actually end-users favorites. End-users own the worst domains in the world; mom and pops, private enterprises etc. The sophisticated big companies will either keep buying dot coms or they’ll operate their own TLDs.

    If you postpone the time frame when end-users will get educated about new gTLDs, then you have a dilemma, because now you’ll have to tell us how you rule out introduction of “dotless” internet by ICANN in the coming years. That is more likely than not. If it’s rumored, or hinted that internet will be going dotless in a few years, pop goes the weasel!

  5. Andrei Says:

    @Ron, Savio D’Silva and Brad Mugford: I agree with you guys that end users will want the “best of the best” in terms of new gTLDs and I also agree that thus far, a *lot* of those are unavailable. However, that will change as time passes in my opinion.

    Dot tv is a good example because it also had premium pricing initially but that pricing model was eventually discontinued and former premiums found their way in the ecosystem.

    But let’s assume that this won’t happen for new gTLDs and that registries always will keep the best domains. I for one don’t think this will happen because (as mentioned in a previous post) domainers are far more important in this equation than most people realize but let’s assume it will. This still doesn’t change the fact that all portfolio owners will be affected by new gTLDs because again, end users will have more options. Now sure, maybe they won’t buy a new gTLD domain from a domainer and will instead purchase it from the registry directly. Does this matter as far as today’s post is concerned?

    I’m sure you’ll agree that the answer is no because the only thing that matters as far as the message I tried to get across today is this: end users will have more options. Whether they buy from domainers or directly from registries at a premium price is irrelevant :)

  6. Andrei Says:

    @Domenclature.com: What I do or what you do doesn’t matter in the grand scheme of things. I didn’t say everyone will embrace new gTLDs. Some will, some won’t but all it takes is “some” end users to start considering other choices and we’re right back to the title of this post: new gTLDs will affect *all* portfolio owners.

    Let’s assume you own 100 domains.

    Let’s also assume that at this point, there are 50 end users who are considering buying one of them from you.

    Will all of them go away now that new gTLDs are live?

    Of course not.

    But there will be pressure on the prices, especially for the lower quality domains. If you own YourInsuranceOptions.com and an end user has the opportunity to buy Insurance.web or other domains of this caliber at the same price, you will probably end up having to reconsider your pricing strategy.

    Also, the reseller market value for various domain categories will be affected even if nobody from your group of 50 end users knows about new gTLDs yet. The market expects people to gradually become aware of these options and I can pretty much assure you that all of this will eventually be priced in.

    The bottom line is that portfolio owners will be affected, either directly (so when it comes to the end users they will be interacting with) or indirectly (when it comes to the reseller market value of their domains, for example). Now sure, we can talk about what the degree to which they will be affected will be but that goes beyond the scope of today’s article.

    Today, I tried to make one thing and one thing only clear: the fact that portfolio owners will be affected by new gTLDs.

  7. Domenclature.com Says:

    “Today, I tried to make one thing and one thing only clear: the fact that portfolio owners will be affected by new gTLDs”. – Andrei

    Good intention, unfortunately you encountered the rigors of logic; as one tries to make one thing clear, facts and other things get in ones way, it’s really a bummer. One dances, and weaves, and sings, and whistles, and dances… except, it’s on molasses, and against the wind. Stubborn things. Facts are.

 
 
         
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