One investor long Rightside Group Ltd (NAME) wrote a piece on Seeking Alpha that the market does not recognize how the new gtlds will affect the bottom line. The author points out how the margins are much bigger on a new gtld as opposed to something like a .com or .net registration. He also highlights the benefit of the being the house (registry).
The author did put some decent work in on the article (Caveat: He is long the stock) which is 7 pages long. If you are interested in the stock yay or nay, it is worth a read imo.
Here is the summary:
- After quitting low quality ad service the company is bleeding cash with razor thin margins on its current business.
- GTLDs represent a major shift in the way domains are used on the Internet.
- The company bought the right to function as a registry for 33 unique gTLDs which is a major difference from its registrar business.
- Revenue per gLTD domain sold is between $20-$30 instead of $1 for a traditional TLD.
- Because of the tremendous operating leverage within the business model a major % of gross margin expand falls to the bottom line.
Read the full article on Seeking Alpha
Author Disclosure : I do not have a position in NAME, Name.com the registrar was an advertiser on TLDinvestors.com of which I am the owner, that advertising relationship ended at the end of August.