Are .AI domains worth the carrying costs for Domain Investors?

.AI domain names

A couple of years ago I bought five .AI domain names, my go-to for ccTLDs like this is 101Domain as they tend to have the best pricing. Still, .AI domains aren’t cheap no matter where you get them, at $159.98 to register and $179.98 to renew, the carrying costs are high. If you do the math, those five domains cost me $800, and to renew, my costs would have been $900.

The way I picked the names I bought then was looking at one-word .COMs that had sold for over $250,000, and I bought the same in .AI. I did get some offers on my names but all under $1,000 – when it came time to renew I reached out to the people who had made offers, by then they had already picked a different name. So I decided not to spend the $900 to renew.

Could there be a profitable model for domain investors to invest in .AI domains? Sure, but I’d say it comes at a much higher risk profile than most extensions, but that could balance with the increase in demand, it’s hard to say and as I’ve just explained above, I have very limited data so am not pretending to be the expert here in any way.

Here’s the last ten .AI domains that sold, compliments of NameBio:

volcano.ai997 USD2020-05-17Whois.ai
post.ai974 USD2020-05-17Sedo
tow.ai756 USD2020-05-17Whois.ai
lingerie.ai510 USD2020-05-17Whois.ai
g9.ai445 USD2020-05-17Whois.ai
n8.ai310 USD2020-05-17Whois.ai
fib.ai310 USD2020-05-17Whois.ai
audiences.ai305 USD2020-05-17Whois.ai
wishes.ai210 USD2020-05-17Whois.ai
spaced.ai130 USD2020-05-17Whois.ai

Looking at these, the average sale price was just around $500. Also one of these domains, Post.ai which sold for close to $1,000 whereas Post.net sold for $26,000 and I think we can all agree Post.com is worth six or maybe even seven figures. Of course, there was just a big .AI domain auction so maybe this is deflating the averages a bit, in reality, these would have sold for more via an inbound offer than through a bulk domain auction.

The highest .AI sale in 2020 was Think.ai which sold for $21,988 in the same Whois.ai auction that these other names sold in. The second highest .AI sale this year was Surge.ai which sold for $10,500 at Sedo.

So it seems reasonable that a solid one-word .AI can sell in the say $10,000 – $20,000 range. The question is, how many of these do you need to own to have one at the right time where the right buyer comes along, with the right budget, and buys it? Well given that most investors sell 1% of their portfolio a year, but just to give it a shot here let’s say you have a totally kick ass year and sell 5x of the average so 5% of your .AI’s sell.

You’d need to have 20 .AI domains in this scenario to sell one, which would cost $3,199 to register. Now if you sell one of them for $10,000 – you’ve tripled your money, you win, but sell closer to the average for a .AI which is under $1,000 and you’re making a losing bet.

This is why I’m not investing in .AI myself even though I see them as hot domains that more and more startups are gravitating towards. Maybe I’ll change my tune but for now the math doesn’t work. The reality is, you’re probably only going to sell 1% of your .AI names, not 5% which means you’ll need to have 100 names to sell one. That’s $15,998 in registration fees to make one sale in an extension that normally sells for under $1,000.

Well that my two cents, what do you think? Are .AI domains worth the carrying costs for domain investors?

{ 7 comments… add one }

  • Fat Anon May 19, 2020, 8:27 pm

    Still, .AI domains aren’t cheap no matter where you get them, at $159.98 to register and $179.98 to renew

    https://tld-list.com/tld/ai

    Reply
    • Fat Anon May 19, 2020, 8:28 pm

      The statement above is a quote of Morgan, looks like quotes aren’t highlighted in this blog

      Reply
  • Domenclature.com May 19, 2020, 9:42 pm

    Hello Linton,

    What do you think about:

    VlogAi.com

    Reply
  • Emeka May 20, 2020, 12:06 am

    Not worth it.I wont invest in them.Leave it to the companies with deep pocket to bear the cost.Most will wait for extra years to sell the names for little profit.

    Only few will pass the test of time.Too high.Sticking to what works for me .Domainers should stop wasting money and feeling the .Ai registrar.

    Reply
  • Dk May 20, 2020, 6:55 am

    I think name makes sense. I do agree that current acquisition cost is very very high. I had big sale in .ai last year (25k) but the word was super premium, and even considering that sale i am no longer acquiring .ais as i think they are very inflated in wholesale market (and holding price is 60$ a year at pork bun but you do have to pay transfer in fee) which is still very steep. The premium .ai one words will do well, the problem with that is you have to pay very high wholesale premium to acquire them. Sometimes higher then .io , and i think .io is a lot more retail friendly.

    Reply
  • George In Miami May 20, 2020, 9:34 am

    Those 10 DN you showed came to $ 4947.00 averaging $ 494.70.
    I can purchase much better .com DN and for less that amount.
    I personally, prefer to focus just with .com and not diversifying my
    efforts with other TLD.

    Reply
  • Logan May 20, 2020, 7:08 pm

    I’ve found that end users understand that .ai costs more, are harder to find and buy, and therefore are willing to pay a premium for them. Single-word .ai with commercial value can sell to corporate or funded start-up end users for five figures easily. Simply making them easier to buy is a value that a domain investor can provide to end users.

    Reply

Leave a Comment