From The Dot Nxt Conference: The Top Auction For A New gTLD May Top $50 Million

I moderated a panel on from the Dot Nxt conference yesterday and asked the panel how much they predicted the highest price of a auction  new gTLD extension would go for.

As you may know if more than one application is received for the same string, the string maybe awarded to the high bidder in an auction.

The panel was entitled “Show Me The Money” and the panelist certaily thought the highest price paid in an auction will run into the 8 figures.

The panelist were; John Matson the COO of Architelos.com, Jose Rasco Managing Director at Straat Investments, which is the holding company for .CO Internet, Adrian Kinderis CEO and co founder of AusRegistry International,  and Steve DelBianco Executive Director of NetChoice

The panelists predictions ranged from $20 Million – $50 Million.

$50 Million for a gTLD extension?

I can say I have sat with several applicants who indicated they were willing, ready and able to spend up to $10M for the string of their choice, so I certainly think $20M-$25M is possible.

So I’m opening up the poll to see what you think.

What will be the highest auction of a gTLD.

You can make your selection on the right and any comments below.

 

Comments

  1. says

    would you sleep well knowing that you’ve taken someone’s hard earned $3,000,000 on a $8 domain.

    hhhmmm

    stress can cut your life short.

    Our mayor in our city was caught red handed visiting gay dating sites from his office and within 1 year he crocked. I kid you not.

  2. says

    Jothan Frakes gave a presentation several years ago where he said he knew of 11 different interested potential applicants for .WEB. And, looking at pre registration requests at United Domains it probably has the best potential for a new super generic. It could go for a lot of money. But, most the panel and experts don’t think many contention sets will be resolved at auction. Rather, power plays and deals will be made. Applicants will be intimidated by, bought out or absorbed by the ultimate winner, which could be a cooperative formed by the most well funded applicants.

    An applicant would need to be HIGHLY motivated to have ABOLUTE CONTROL over a string to opt for a $20 – 50 million auction bid. And, that applicant would have to be up against ANOTHER highly motivated applicant to drive the bids up that high, without working out some sort of compromise. Something like this could possibly occur in highly valuable niche TLD, like .insurance, .games .loan, .poker, .realty – where the applicant is looking at the possibility of controlling a vertical TLD namespace in their industry.

    Nobody knows, but IF these TLDs begin to see any significant SEO benefit, they would be worth hundreds of millions $$.

    But the risk is great, as was mentioned during the session, the money you would spend at auction would be much better served in a marketing effort than handing over to ICANN.

    Don’t think too many auctions will occur but there will be some exciting times post May 1 2012 when applications are made public and ‘DotDomainia’ officially starts.

  3. says

    .WEB – the ultimate winner, which could be a cooperative formed by the most well funded applicants.”
    =====

    Why would they fool with .WEB when they can take .ORG with an existing base of 10,000,000 domains ?

    Is ICANN.ORG trying to distract people away from the obvious low-hanging fruit?

    Cutting the ISOC out is an instant $26,000,000 savings.

  4. Jack says

    @Robert Cline

    Seriously… where do you come up with these things? Sometimes I think you enjoy pulling things out of your butt.

    Just my thoughts.
    Cheers

  5. MHB says

    David

    To be clear I’m not saying there won’t be gTLD’s that will fail, there absolutely will.

    Just like for the next 1,000 restaurants to open in the US a fair percentage will fail or like any other business.

    At the end of the day running a registry is running a business.

    But I don’t see a new gTLD registry that applies in 2012 failing and closing up shop in 2014.

    Let’s have a gentleman’s wager of a bottle of Blue on it.

  6. MHB says

    Robert

    Can you tell me what the hell Rick Schwartz or the sale of candy.com has to do with the topic of the post?

    BTW can I have your address.

    I have a pretty big bandwidth bill to send you for the last 1+ worth of comments

  7. MHB says

    Tom

    Is correct the panel didn’t think a lot of extensions would go to auction, but would be resolved by some agreement of the applicants.

    Of course this mind set in and of itself is going to cause game playing at the applicant level but that is another post for another day

  8. says

    @MHB

    oh come on

    I was only responding to someone else’s candy.com post.

    This site does have something like an entertainment feel disclaimer right ?

    Sometimes I wonder if some idiots take things said here too seriously.

    I like posting while I am working on the other half of my 17′ laptop.

  9. says

    Just like for the next 1,000 restaurants to open in the US a fair percentage will fail or like any other business.

    If I want a burger or a steak I can go to another restaurant if my usual one fails.

    If I’ve bought a second level domain for my business and my TLD fails that’s much more serious, because I need to get new branding, new signing, update all my systems and let all of my existing customers and suppliers know my new website and new email addresses.

  10. says

    It never has been clear why a .ORG (as in ICANN or ISOC .ORG) would be getting a cut of .COM

    apparently (wink wink) Verisign likes the hand-shake .COM deal

    What would .COM as a gTLD bring at auction ?

    or, why auction .ORG or .COM when a new DNS Plaform can slide in and take them one name at a time, the old-fashioned way…

    serving 10,000,000 .ORG customers seems like a good business, even if the wholesale price is cut in half

  11. says

    Maybe a dumb question for @Rick Schwartz or anyone.

    How exactly does the owner of candy.com, or NYC.com benefit when the .CANDY or .NYC TLDs go live?

    how does traffic for that specific domain go through the roof?

  12. says

    Maybe a dumb question for @Rick Schwartz or anyone.

    How exactly does the owner of candy.com, or NYC.com benefit when the .CANDY or .NYC TLDs go live?

    how does traffic for that specific domain go through the roof?

    No disrespect but if you don’t know the answer to that question at this stage of the game you need to have a long hard look before you think of investing in new gTLDs.

  13. MHB says

    GPM

    That is one of the reasons ICANN is requiring applicants have funding to operate for three years ongoing so that customers would have plenty of time to move to something else in the case of a failed extension that no other company would come in and agree to take over

  14. says

    @MBH – 3 years is a start but the TLD is so intrinsic to everything in a business ICANN shouldn’t be approving gTLDs which are more likely to fail. The last thing the industry needs is sharp suited salesmen pushing a series of pump and dump TLDs.

  15. says

    “The panelists predictions ranged from $20 Million – $50 Million.

    $50 Million for a gTLD extension?

    I can say I have sat with several applicants who indicated they were willing, ready and able to spend up to $10M for the string of their choice, so I certainly think $20M-$25M is possible.”

    So with these huge numbers being predicted, how does ICANN expect this to be “revenue netural”?

    It was an obvious cash grab from the first.

    Now members who helped this pass will be entering the private industry in an obvious conflict of interest out of their own personal interest….It is already happening.

    Brad

  16. says

    “It was an obvious cash grab from the first.”
    ====

    Consider the total cash-flow since 1998 and all of the companies prevented from entry into the Top Level Domain game.

    Where has all YOUR money gone ? what has it funded ?

    How has ICANN and ISOC pulled that off ?

  17. MHB says

    Brad

    I have called out ICANN out on this as many have done

    You’re right that the budget does not have ANY amount as coming in for auctions, which is just plain silly & yes ICANN will have after the 1st round hundreds of millions in the bank

  18. says

    You guys are thinking like domainers…you guys don’t even count…you guys are .00000001 percent of the world population who uses the internet.

    Rick Schwartz has been preaching this quote for years…hope you have learned it by now!

    “When you see John Jones through John Jones eyes, you will sell John Jones what John Jones buys”

    and your average John Jones is going to be confused and run to GOOGLE….no more type in traffic!!!

    MARK THIS POST!!!

  19. BrianWick says

    Shows how much speculative money there is vs. what will actually put food on the table. i.e. salivating over being the new king vs. good business and pulling out a few good .com’s and making a boatload.
    Good God.

  20. KenH says

    Take any gTLD that can generate a million registrations (.web certainly can) and multiply by $6 or more per name for the wholesale price, you start to get an idea of what the value might be.

  21. abe says

    @Anunt – For the time being there will be a “leak” as Rick calls it to the .com.

    However, more people will resort to search engines due to confusion, and not knowing what is a scam site and what is not.
    They will assume that if a specific site is # 1 in search then they are legit. The value of domains in search engines as a major factor will go down. The solution is elsewhere.

  22. BrianWick says

    @Abe
    “more people will resort to search engines due to confusion, ”

    Actually – more people will resort to typing in the intuitive .com in the command line due to confusion.

    For myself I invest in .com’s so that I do not have to lick SEO anal cavity

  23. says

    In 1998, ICANN was formed to move an academic (IANA) into a corporate structure. That was supposed to help end the academic run-arounds and the back-room-deals.

    If you were to read archives closely from 1998, the idea was also to use ICANN as a Cheerleader, as a vehicle to pull people into the platform. That is how some
    of the legal loop-holes emerged, Proof.of.Concept is a big one.

    Unfortunately, many
    stuffed suits stepped in and redefined the platform and placed themselves into the
    cash-flow streams. Despite their back-room-deal-making system, people were
    still pulled into the platform. Some of the academics have been diluted.

    The stuffed suits imposed a Client-Server (Cntralized Registry) model. They
    now plan to pull more (new blood) into their MLM scheme. There is a FALSE
    presumption that the incumbents somehow “own” the legacy name.spaces.
    .COM .ORG .NET are cash cows. Who really owns .ORG ?

    In parallel with the inflated auctions and cyberspace grabs, there is a need
    to RELAUNCH .COM .NET and .ORG with new companies. The Peer-2-Peer
    DNS model will be used. No auctions or grabs are required.

    While noobs are distracted by the ICANN Cheerleaders with new TLDs and
    auctions and endless debates and conflicts, the Smart.Money will be…..
    Selling to the Market…

    It will be interesting RE-Registering 75,000+ .COM domains to ensure they
    are in the P2P DNS. Ten million .ORG owners are waiting to be serviced.
    Why waste time and money on ICANN’s latest game for noobs?

    Why be a pawn in ICANN’s game ?
    You can own part of the .COM Registry and laugh all the way to the bank with ICANN and Verisign. They do not have exclusive rights to the 80+ million
    .COM Registrants. You can service those Registrants.

  24. Seriously Concerned Reader says

    DEAR MBH

    PLEASE BAN Robert Cline FOR THE LOVE OF GOD.

    HE RUINS EVERY COMMENT THREAD and I’m SURE you are losing readers. Readers that might ADD to the conversation. After years I’m over reading the comments on this blog, always the same illogical arguments that throw everyone and everything OFFTOPIC. Worst trolls ever.

    If someone has such an agenda to take all your stuff offtopic, they might like to go and create their OWN COMMUNITY TO RUIN.

    I can’t be alone in being sick of it.

    PLEASE BAN THE CRAP!

    A robot can be programmed to spout more logical statements, or maybe he is a SPAM BOT (no, seriously)!

  25. says

    I think there is a huge difference from some years ago and now, some years ago I would have gladly paid millions to get .web.

    But its a completely different environment now, when 50,100 or more generic extensions will come to the market at the very same time.

    I think its now worth much less then it used to be.

  26. says

    “I think there is a huge difference from some years ago and now…”
    ====

    Years ago, it was a 5 minute operation to add a new Top Level Domain with a phone call to the IANA – Some people did that and they continue to operate under
    the radar – They have avoided RE-BIDs

    Now you have to Grease all the right people’s palms and stroke their egos and scratch their backs and smooze their cronies and then THEY tax you after you
    have paid them to “like you”.

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