We have been talking about the new gTLD program for well over 6 years and over the weekend we noted that the number of new gTLD registrations passed the 2 Million mark.
So we thought this would be a good time to give some thoughts about where the program is at and where it is going.
Since we have been writing about the new G’s we have pretty much said the same thing, we don’t know how they will do or what effect they will have on the .com aftermarket.
After the launch of 194 new gTLD’s into general availability and 2 million registrations, we still feel the same way. While there is certainly some good data available from which we can draw some conclusions, for the most part the jury is still out.
In my opinion the jury is going to remain out until the third quarter of 2015, at that point we will have the first renewal period for those new G’s released in the first and second quarters of 2014. Considering the amount of domain names that carry premium renewal fees, I will be very interested to see how high the renewal rates are.
I have also said its going to take 5 years at a minimum for heavy user adoption and an active aftermarket.
If you are going to be registering new G’s for the purpose of resale, unless you are happy making a very small profit on a domain registration, by in large you are going to have to be prepared to hold the domain for at least 5 years.
My thoughts on that have not changed.
As we sit today the new G’s have been dominated by Donuts who have launched 119 of the 194 new gTLD’s in general availability. Their “partner” in some strings Rightside have launched 14 and Uniregistry have launched 9 new gTLD extensions.
So out of the 194 new gTLD’s that are in general availability, three registries have launched 142 of them.
There has not been a non-IDN launch of a new gTLD by the three largest other applicants for new gTLD’s, Minds + Machines, Google and Amazon.
So as we sit today there are still plenty of arguments for both the proponents and opponents of the new G’s.
We have known for a while that the trademark holders are not playing in the new G’s.
We can see outside of the registrar channel that very few registries are spending money visibly marketing. .Club, Uniregistry and Radix are the rare exceptions.
I still haven’t seen a television commercial or any other advertising in any major media outlet for the the new G’s. So far nothing from registries or registrars, other than 1and1.com’s campaign last year before the new G’s even launched.
Arguments for proponents of the New G’s:
1) The big Geo’s are yet to come, .London, .NYC should add significant numbers of registrations and publicity for the new G’s.
To date only one big Brand applicant (Axa) has “launched” its new gTLD and none have begun advertising campaigns around a new gTLD domain whether they own the extension or not.
2) The “better” new gTLD extensions haven’t launched.
Almost all launched new G’s to date were single applications placed only by one company. In the case of the few extensions that were settled by private auctions and are now launched, .club and .photography are ranked 3 and 6 respectively, in terms of domain name registrations.
The new gTLD’s with the most applications not only haven’t launched, but they haven’t even been settled, these include .web, .music, .books, and .app to name just a few.
Neither Google or Amazon which applied for 101 and 74 new gTLD respectively have launched an extension (Google launched an IDN)
Although the number of reported new gTLD aftermarket sales have been very small, Godaddy/Afternic is in their quiet period for Godaddy’s IPO and they haven’t released sales figures of any domain sales in over 2 months.
3) According to a study by Sedo, which we chat more about below, only 40% of people are even aware of the new G’s and over time that number will grow substantially, as other registries launch and maybe will spend some marketing dollars.
Once again the new gTLD’s launched so far have been dominated by Donuts and Rightside. These registries have a premium registration and renewal model, we don’t know what a lot of the other registries have in store, nor do we know the pricing if they do go the way of the premium domain route.
4) There are Millions of domain names that are not available for registration due to ‘Collision”. ICANN prepared a collision list for each extension which they are not allowed to sell or allow to be registered.
Most of the collision lists runs into the four figures of domain names, but some lists are into the five and even six figures of domain names.
Therefore the number of domains are artificially low due to the collision domains being unavailable to be registered. Once those domains become available to be registered, the overall registrations numbers will shoot up.
5) Two charter domain registrations in new gTLD are not yet allowed. Although many registries have applied to ICANN to allow the registration of two character domains, as we sit today no one can register a domain name containing two characters (two letters, two numbers or a combination of a letter and a number, which has taken thousands of domain names off the market for new gTLD’s
For the opponents of the new G’s, there are plenty of arguments for them as well:
1) Out of the 2 million new gTLD domain registrations, 500K or more of the registrations have been given away for free.
Registries have registered over 100,000 of their own domain names and reserved them for future sale or development, so the “real” number of paid new gTLD’s is probably under 1.4 Million.
.TK which has been offering free domain registrations for several years is now the second most registered TLD in the world, only .Com has more registrations. I have never seen a .TK domain name sell on the aftermarket, nor have I seen any big marketing campaigns around a .TK. We wrote a cover piece on the .TK registry back in March 2012 when they “only had” 8 million domain registration. according to the latest Verisign report .TK now has around 25 million domains at the end of the 1st quarter of 2014.
Giving away free domains is not a problem. There are plenty of takers.
2) Other than luxury.estate and few .club domain names, there have been no notable sales of new gTLD domain names and the number of reported aftermarket sales has been very small in relationship to registrations.
3) 2 Million new gTLD registrations is still less than the number of .Biz domain name registrations (2.6M), less than half the number of .info (5.6 M) registrations and just slightly higher than the number of .US registrations (1.8M), none of which have had much of an aftermarket over the years. Personally after holding internet.biz since the day the extension launched, I sold the domain for $20K this year.
The number of new gTLD registrations is also 1/10th of the aforementioned .TK ccTLD.
4) While many point to the brands as the game changer for new gTLD’s, the fact that only one of the .Brands (Axa) that applied for their own new gTLD have launched. So while the supporters of the new G’s are looking for .Brands to lead the way, those .Brand applicants don’t seem to be in any rush to launch or use their new gTLD’s.
Bottom line there are no major advertising campaigns that are currently running in mainstream media, using a new gTLD.
5) Premium pricing and renewals are pretty aggressive and in many cases have priced domainers out of the market.
It is pretty tough as the early investors in .TV found out to pay $1,000 a year renewal fee and sell a domain name for significant dollars that carries such a fee. Many domain names carry registration and renewal fees in the four figures and as we wrote about today, now well into the five figures.
6) The Sedo International new gTLD Awareness Report for 2014 did not contain a lot of great news for new gTLD’s:
“”Among marketers in the U.S. 75 percent said that new gTLDs would make the Internet more confusing”
“This is a much higher number than a year ago, when only 62 percent of U.S. marketers said new gTLDs would make the Internet more confusing.”
“The underlying theme throughout all the results is that awareness and acceptance of new gTLDs is still the biggest hurdle for them to ultimately be successful”
Today, the europeandomaincentre.com published views by others in the industry including Frank Schilling and Rick Schwartz. I was asked to participate but declined as I have my own vehicle to share my thoughts and I’m sure you have heard enough from me. You should check out that post to see what others think about the 2 million mark.