In the Marchex (MCHX) earnings call today a question was asked about how the new gTLD’s will effect .com’s values specifically those domains held by Marchex. and how the continued movement of consumers to smart phones will also effect the values.
Here is the question which was asked by Andre Sequin of RBC Capital Markets, LLC, Research Division:
“In terms of the value of the domain portfolio, how do you think the introduction of the new gTLDs, which will be happening here in the next 2 months, will impact the value of the domains you hold? And then coming at it from a slightly different angle, does the shift to a more mobile world and a broader use of smartphones have any impact on the value”?
Here is the answer by Russell C. Horowitz , Founder, Chairman, Chief Executive Officer and Treasurer of Marchex
“We’ve done exhaustive due diligence as part of our process with Archeo. And in looking back at the new TLDs and potential impact,
“I think I’d liken it to the fact that, in the past, when new TLDs have been introduced, whether they’re .biz or .info, they really haven’t impacted the value of generic commercial .com domains.
“When we look at the new TLD introduction, it’s possible they’ll grow the market to some degree.””
“But the feedback we’ve received from folks who have both made investments in that market and other folks in the domain space, as well as based on our own experience and the fact we continue to see very high demand in terms of the Archeo assets, it kind of tells us that commercially relevant .com domains continue to have substantial value, and we don’t believe the new TLDs are a significant factor that impacts that value.”
“In terms of taking kind of the question further into mobile and its importance, what we’re seeing is that publishers with multichannel strategies really require a key domain to be part of that strategy.”
“And so even with mobile and the evolution, it doesn’t seem to be impacting, again, the value of commercial generic .com domains. ”
“The .com generic domains are really key elements of any large brand and for any new business coming online.”
“And we think it’s important as they look at kind of multichannel opportunities that include mobile that, that continues to be a key part of it. ”
“Nothing’s happened that changes our view.”