Don’t forget .BIZ, .MOBI and Many More gTLDs Are Profitable…Just Not For Domainers

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Ah the new gTLD debate, it dominates the headlines in the Domaining world now and for a very good reason. The domain world is changing and like it or not, it’s coming like a freight train and there’s not a chance it’s going to slow down. Think it’s a fad? Think again.

What has been interesting to me as this unfolds is how some investors are only looking at one side of the equation. I personally am a HUGE fan of the new gTLDs, I am really excited about them, just not as a Domainer. I think that the people who will make money with new gTLDs will be the owners of the gTLDs and the winners will be startups and small businesses all over the world.

Disagree with me? If you’re a Domainer I’m sure you do, if you’re a startup founder you might be jumping for joy…and if you’re running a gTLD I think you’re getting ready to ring the register.

We all like to call TLDs like .MOBI and .BIZ a flop but both actually represent very profitable businesses for the owners. Sure you probably won’t make much money buying and selling .BIZ domains but we’re talking about a multi-million dollar business for the operators.

The reason why companies like Donuts were able to raise hundreds of millions of dollars is not because PE firms thought that Donuts would sell millions of domains to Domainers, it’s because there’s a low threshold to profitability and the potential for them to own and operate hundreds of profitable businesses.

So next time you poo poo new gTLDs just remember, they really aren’t for you, stick with .COM that’s where the money is for Domainers, leave the gTLDs to all the people all over the world who are just starting to use the Internet and are looking to carve out their piece of it. As for big money being made with gTLDs, it’s going to happen, it’s just going to be the folks running the gTLDs who will do it.

Like what I have to say? Hate it and want to tell me I’m a complete idiot? Do it, that’s what the comment section below is for!

Photo Credit: ST33VO via Compfight cc

{ 20 comments… add one }

  • Domenclature.com November 7, 2013, 10:01 pm

    Now, this is a plausible argument. All my comments, and thoughts about the new gTLD regime, has been geared towards the domain name investment prerogative ( entitlement, right, privilege, advantage).

    If any blogger, or Registry presents the debate in the form above, I will have no qualms with it at all.

    I am not against the success of these Registries at all. I wish them well. If they succeed, we have an opportunity to join in future string offering.

    My concern, not misgivings, possibly doubts, and certainly reservations, center around returns on any investments by domainers. Period. When I use the word success, it all revolves around domain name investors, not the Registries, Registrars, or ICANN.

    I am only concerned with what is true or false.

    Reply
  • Morgan November 7, 2013, 10:37 pm

    100% agreed @Domenclature and well said! Like I said in this post and I’ve said in conversation many times with other Domainers – the new gTLDs are a terrible investment opportunity for Domainers but an amazing business opportunity for the people who run the gTLDs and all the people around the world who are just getting started on the Internet.

    Reply
  • HowieCrosby November 7, 2013, 10:56 pm

    @Morgan So you wouldn’t invest in used.car cool.blog etc ?

    Reply
  • Robb November 8, 2013, 12:32 am

    So if there were no new gtlds coming, would all the future start ups not be happening, or would they just have chosen an existing extension? No matter what happens I still see confusion happening, some new gtlds failing, and successful start ups upgrading to .com if possible. There will be investment opportunity for domainers in names like loan.web or Newyork. Homes IMO

    Reply
  • Joe November 8, 2013, 3:17 am

    Yes you are a complete MOBiiiiiii ! is best if you do well and I understand Biz .

    The gTLD is like a puzzle with too many extensions that ultimately ended as badly as it started 100% saved at the end only 10% the rest see floating in the darkness of a large market and industry that will be lost with mism time , so beast become the regulator .

    The Business of the gTLD be the same as the principle of generic , I guess this will be like a great discount day is done once a year and to open the doors of the establishment come stampeding to catch all the best pie .

    The smacks to have the best cake and have it regitradoras companies already have anticipated buying two , three and four letters and numbers in portions of this huge pie . These provide keyword save the gTLD that we desire without the price , which at first may be affordable to most income and renewal always surprise many who go with D / B / A is very high unpayable and let expires , this is what we have now and do not change from one year to another .

    The most business and labor have to be gTLD Lawyers, due to the great lack of awareness on the purchase to make many people and startups blind to this economic bubble and the best benefit be trademarks worldwide.

    I think that after a year of going to the website and find expired domains gTLD million some with good price and other with traffic , this is what we have now and what we have in abundance later.

    Great Weekend.

    Reply
  • BBB November 8, 2013, 5:58 am

    Quote: “So next time you poo poo new gTLDs just remember, they really aren’t for you, stick with .COM that’s where the money is for Domainers, leave the gTLDs to all the people all over the world who are just starting to use the Internet and are looking to carve out their piece of it.”

    The new TLDs are not for domainers.
    The new TLDs are not for end users. (partially explained below)
    The new TLDs are for the registries only to make money.

    Morgan, you say you are super excited about the new TLDs?

    Are you excited about how all the servers have to replumbed all over the world to just be allowed to receive emails from the new TLDs? It’s the equivalent of ripping off sheetrock in your house b/c you forgot to add the pipes to allow water. That’s just silly to build an empire on a new TLD where communication is hampered.

    On top of this don’t forget the .com will be getting a lot of the email from the new TLDs. Let’s take .club as example: love.club , love.club.com . The latter will get much of the email when surfers type in john@love.club.com by accident instead of john@love.club

    Are you excited about the traffic leakage to .com ? It’s going to be such a problem many sites won’t ever get off the ground.

    It can’t be much clearer with the famous O.CO and O.COM 61% traffic leakage example. .CO leaked 61% to .COM in this instance. Although I don’t expect it to be this high with the new TLDs but even 3% leakage to .com is unacceptable to a business and might be enough to take away the gravy, meaning the profit margin, and put a company out of biz.

    Are you excited how they will be less memorable on a grand scale, meaning that consumers will need to remember thousands of individual extensions just to navigate?

    Are you excited how everyone will need also remember exactly where the dot goes ?

    Are you excited at how, unlike .com domains which have a fixed price for the next six years, and then limited prices hikes after that, the new TLDs can have their price raised from $10 a year to $10,000 the next? Would you be willing to spend money to rebrand if that happens? Would you choose another new TLD or would you go .com at this juncture? There are ZERO price controls on the new TLDs.

    Are you excited about how much more money it will take to brand these so that people know not to type in .com at the end?

    I respect you Morgan for speaking your mind about the new TLDs, even if it is not popular notion among domain investors. Every argument needs two sides to make it compelling and thoughtful.

    I also hope that you’ll admit you are wrong or right, some years down the line when it is clear what the then-present and future appear to be. 🙂

    Reply
    • Morgan November 8, 2013, 11:25 am

      @BBB – thanks for sharing your thoughts, it is always welcome! Sounds like we definitely have a big difference of opinion, I know tons of startups doing millions of dollars in business on .CO and .ME domains and not one of them has complained to me about traffic leakage. O.co is an isolated case and I think there are a lot of complexities there.

      In summary, “Yes!” I am very excited about new gTLDs and I think a lot of the things you are saying like people not remembering where the dot goes or having to remember other TLDs is are just assumptions, not real validated problems.

      Agreed there are two sides to this issue and I think Paul and the team at Donuts are some of the smartest people on the planet. They, along with many of the other gTLD owners like Daniel Negari and Frank Schilling are going to show the whole world what a success “some” of these new gTLDs can be.

      Only time will tell but at this point in time I am damn excited about the new gTLDs, bring em’ on! 🙂

      Reply
  • Konstantinos Zournas November 8, 2013, 6:54 am

    @HowieCrosby
    Most of these domains are going to be treated as premium and are going to be auctioned or sold at prices that will be far above the current market value. ie You will not be making money on these for the next 10-20 years. I for sure don’t have money to waste on such “investments”.

    Reply
  • Ms Domainer November 8, 2013, 9:43 am

    *

    The great thing about gTLDs like .biz and .info, you can occasionally hand register a premium term.

    I recently registered a geo domain in .biz. (major historical location). I thought it was a good risk.

    However, registering lesser names in non-dotcoms is probably not a good investment plan.

    *

    Reply
  • Kassey November 8, 2013, 3:16 pm

    Exactly, Morgan!

    Reply
  • Joe November 8, 2013, 3:19 pm

    @ Morgan When you write ” I think Paul and the them at Donuts are some of the smartest people on the planet . They , Along with many of the other gTLD owners like Daniel Negari and Frank Schilling are going to show the world what a success wholw ” some ” of These new gTLDs can be” truly confuses me this part of your answer.

    Reply
  • Konstantinos Zournas November 8, 2013, 3:22 pm

    Morgan haven’t you heard of people not being able to type in a domain name in the address bar? At least 2 people have called me and asked me how to do this. Some people think that the internet is google.com. A lot of people are going to be confused and that is a fact.

    And because someone is not complaining about a problem it doesn’t mean that the problem doesn’t exist. Maybe they have accepted traffic leakage or they just even know it exists. There is traffic leakage within .com itself and people don’t realize it for years!

    Lastly, success means different things to different people. A registry can be successful and totally unknown at the same time. All it takes is to make all the trademark holders to buy your domain names. For me, success in new gTLDs is not merely being profitable.

    Reply
  • Alan Dodd November 8, 2013, 4:30 pm

    From a domainer point of view, and my own mind is open on this:

    Is the main issue whether dot-com will remain an investable property or not?

    I took a coach ride through London a few weeks ago.

    Two things I noticed:

    1) The quality of naming among stores is awesome. Names like “and so to bed..” Really got me thinking.

    2) dot com was comfortably beating .co.uk. That I was surprised about.

    I am looking forward immensely to new tlds! There has to be some opportunity… but the names have to be pure class, like hacks! Like used.cars or whatever.

    One thing, all this choice!! So take a startup seeking a name. They will now be presented with a choice of um.., thousands! Do you think a few might choose to stay with the tried and trusted and avoid traffic seepage?

    Well, we’re about to find out! Looking forward to it!

    Reply
  • Kassey November 8, 2013, 4:41 pm

    “2) dot com was comfortably beating .co.uk. That I was surprised about.” Does it mean you see more .com than .co.uk being used in the UK? Regarding those that are using .com in the UK, do you think it is because of their aspiration to be global, or at least wanting to project the image of a global brand?

    Reply
  • HowieCrosby November 9, 2013, 6:43 am

    @Konstantinos Zournas “Most of these domains…” That’s just your opinion, it’s not coming from any evidence based literature!

    Put it this way all of the best one word domains are now reserved as of early 2011, there is no way going back, that’s investing, and buy 2015 we will see my friend!

    Reply
  • Konstantinos Zournas November 9, 2013, 6:54 am

    @HowieCrosby
    Sure that is my opinion, based on facts. .xxx reserved all the good keywords and is selling them at premium prices. .college and .xyz is already auctioning off domains. That’s the facts.
    Frank may be saying that they won’t have premium prices but most domains are going to be caught by backorder services and auctioned off anyway.

    I don’t understand what you say here:
    “Put it this way all of the best one word domains are now reserved as of early 2011, there is no way going back, that’s investing, and buy 2015 we will see my friend!”

    Reply
  • HowieCrosby November 9, 2013, 7:35 am

    During early 2011 I was able to reserve some catchy one word new glds with United Domains who were running a live service, it was a first come service and you had to keep refreshing your window old school style to see when the next new extension was entering the platform.

    This gave the user the option to reserve up to 500 domains if they wish, it was an exciting time, at a later date you could edit your account accordingly.

    Therefore, present times, depending upon outcome of extension, the user has first refusal to buy the said domain, as it is secured within their account.

    I hope this explains the queried quote you sent, thank you, Howie.

    Reply
  • Alan Dodd - NameDream.com November 9, 2013, 8:23 am

    @ Kassey re London

    The answer is I don’t know! A few things. There are issues with .uk coming out as opposed to .co.uk.

    Not sure what the state of play is on this.

    Another thing: London is such a globalised metropolis now, dot com makes sense for brands 2 advertise.

    On another note on my trip to London: did not see as much dotless as I hoped to. And, with the new Gtlds, there might be a move to publish right of the dot, to avoid confusion.

    Saw an advert in Dublin for spotify and was shocked to see how prominent the dot com was.

    Reply
  • Konstantinos Zournas November 9, 2013, 9:39 am

    @HowieCrosby
    This is 1 registrar out of 1000 and they can’t even guarantee that these domains you registered are going to be available, yet alone that they will get them for you.

    Reply
  • HowieCrosby November 9, 2013, 9:49 am

    Not quite, I don’t think you have all the facts, but nothing is guaranteed, however if you have enough in the pot you should yield.

    Reply

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