Domain Industry: Predictions for 2012 | DomainInvesting.com
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Domain Industry: Predictions for 2012

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I don’t really enjoy making predictions for the new year, so I thought I would get off easy this year and do the asking this time. I asked a number of domain industry colleagues and professionals if they would be willing to share a prediction (or a few) for 2012, and many people were kind enough to offer their insight. Hopefully, this will be helpful to you as you close out the year.

I invite you to post your domain industry predictions in the comment section and/or provide feedback about some of these predictions as well.

2012 Domain Industry Predictions:

Paul Goldstone, iGoldrush – My prediction for 2012 in the domain business is a substantial increase in education and public awareness about domain names. Over the past year the business world has heard more about domain names than any other period in time. They learned about the possibility of new domain extensions, they heard from those for and against the new extensions, they heard examples of new extensions, and they heard about some of the players. With all this talk of domain names, what they have still yet to hear much about is how domain names can actually be of measurable value to their companies outside of a virtual street address.

Whether their opinions of domains, the players, and the potential of new extensions are positive or negative, once thing is for sure – we have their attention. I believe that 2012 is going to be a significant year where smart domain companies will join us in our mission since 1996, by educating the business world as to the value of using domain names to improve their bottom line. This newfound understanding and public awareness will in turn increase the overall value of domain names, a win-win situation.

Bill Sweetman, YummyNames – There is going to be an increase in the number of domains sold to buyers in Asia, especially China. The Chinese market is huge and rapidly-growing, and I see a bright future for domain sales into this market.

The Honorable Neil Brown QC, UDRP Arbitrator and Mediator – My prediction is that there will be more applications for new gTLDs than has been anticipated. There has been a widely held view that many companies will hold back and just keep an eye on other applications and see if there are any that affect them. So it has been thought that there may not be many applications. I am inclined to think that more than expected will actually apply, irrespective of what others do. Obviously the fees and costs of making an application will be quite high, but those involved will be well-heeled, so the costs will not deter them and consequently many will apply for gTLDs, no matter what the cost.

The reasons why they will apply are, first, the reasons already advanced and talked about and there is no need to repeat them. But I think there will also be quite a few applications for the additional reason that the “old” TLDs no longer mean as much as they did or as they were supposed to be understood. A .com domain name could indicate anything at all today and the new gTLD creates an opportunity to make it clear to the user and the potential customer just what is covered by a domain name under that TLD and what will be found on its website.

The consumer will therefore be more likely to go to a website where it is clear what it stands for, rather than any other website. Companies will have worked that out and realized that it is a great marketing tool. They will also know and it will be a fact sooner or later that the potential customer, the user of the internet, will think the security at the website at the new gTLD will be greater, as a well known company is standing behind it, guaranteeing its reputation and ensuring that it is safe as it can be and that there are no risks in the consumer using it. So the new gTLD will inspire confidence on the part of the consumer; companies will know this and will want to avail themselves of the advantage that can be gained by having a domain name and website that announces to the world that it is the company’s own, that the company stands behind it.

There is a lot of concern among ordinary people about computer and online fraud and having a new gTLD will reduce at least some of this concern .There are also other obvious benefits of having a new gTLD and, for whatever reason, I think the new gTLDs will do well. I have heard of quite a few applicants who are getting ready to lodge their applications, which they will do early and probably not wait to see what other potential applicants are doing. The other prediction I make in this area is that there will be disputes, but that the range of dispute resolution systems created by ICANN are so extensive and so good that they will prove very effective in resolving those disputes or encouraging a settlement.

Fred Mercaldo, Cities Planet – We will see, finally, major media getting involved with pure geo City.com brands.

Josh Metnick, Chicago.com – After some stagnation, the values of Geodomains will skyrocket with the final realization of marrying the academic concept of place-identity with those domains. Lawyer@chicago.com is probably worth 50k or more to the right person. Emails will be treated more like domain names, they are digital assets.

Brian Gilbert, Innovation HQ – With the Presidential election coming up we’ll see major candidates putting tons of effort and marketing dollars towards social networks. New ways to reach their audience effectively will evolve. Focusing campaign efforts towards social media will continue to raise awareness of the massive online community advertisers can reach. Marketers will be watching the campaign strategies closely and probably learn from their methods and make attempts to mimic those methods. Some advertisers/marketers will be smart enough to go after related domain names and be ready to pay.

Karen J. Bernstein, Law Offices of Karen J. Bernstein, LLC – I predict that in 2012 there will be substantial problems with the majority of Generic, Geographic and IDN gTLD applicants being approved by virtue of the complexities of the applicant proving it has the financial capacity in answering the ICANN gTLD Guidebook Questions 45-50. It is by far the most difficult part of the application process.

The ICANN gTLD Guidebook Questions require extremely detailed predictions and ICANN provides no benchmarks for what is an acceptable financial model going out three years in advance, which is akin to working in the dark. I believe that based on the laborious financial review process the timeline for ICANN to publish approvals of applications will be delayed by virtue of the financial complexities ICANN has created for companies seeking to become a gTLD registry. Brand gTLDs will most likely have little difficulty since their registry is “closed” to the public.

Tim Chen, CEO, DomainTools (These views are Tim’s and do not necessarily represent the views of DomainTools) – Increased competition in the registrar space: This may be stating the obvious. No disrespect to our regsitrar friends out there but to the general public this has been a one horse race for the last 5 years. There are good companies out there than can compete with GoDaddy today, and others that should. The recent uptick in 1&1 advertising is a harbinger. Web.com is circling the wagons with Register and Netsol. Enom has deep resources and a strong team, as does Tucows. Expect a lot more consolidation in this space in 2012, likely led by GoDaddy and the motivation and funds provided by their new private equity investors.

Brain Drain – This is both a positive and a negative. ICANN, Verisign, Oversee and Sedo turned over their CEOs this year (Rod Beckstrom in process). There were others as well. RIck Schwartz closed his blog and implied he may turn his attention to other industries. It hurts to lose experienced leaders from our industry. But the good news is it will allow for new energy and insight from a new generation of industry leaders. Given the talented, driven and now wealthy entrepreneurs that created this industry, I expect many more will move on to new challenges in 2012. It is worth noting guys like Frank Shilling and Mike Berkens who are iterating into adjacent businesses but sticking to domains. I’m rooting for them and hope others are as well.

Co-opetiion. I hate that word but it seems appropriate. It’s not too many years ago when it seemed we had domainers, registrars, parking companies, and drop/sales platforms. Now everyone is bleeding into each others’ business. We’re all trying to grow our businesses and leverage our installed asset base. It makes sense and happens in all industries. But that person you are catching up with over cocktails at DomainFest is very likely a competitor as well, much more so today than a few years ago.

Kathy Nielsen, Sedo (These are Kathy’s personal views, not necessarily Sedo’s) – I am really looking forward to 2012 and the changes may be in store in the domain world. There are so many interesting things going on. I have been amazed this year at how the mainstream media picked up such sustained coverage of the new gTLD potentials and launches. ICANN/.XXX/AMA, etc have brought the topic of domains to the general population. Even my 80 year old father asks me about the latest happenings at ICANN, yet he cannot tell you what I do for a living. This is an awareness that we’ve never seen before on this scale. I think it will translate into positive things for the industry. Bringing awareness of domains to the general population can do a lot of good things!

*Raise awareness that the market for premium domains exists (premium = registered) and has value
*Sets the stage for new gTLDs and potentially an openness or awareness to the population that they will very likely see something to the right of the dot besides .com.
*Finally, companies of all sizes are getting educated on the value of domains and what they mean for their organizations. This may not mean that they are going to run out and apply for a new gTLD, but it is forcing many of them to assess what they have, and see that there is value.

I think with the hype, marketing and excitement that surely many big brands will try to create with their new TLDs (hoping to see some launch in 2012?), this general discussion of domains, even beyond the brands, will keep this topic in the news, and in front of the average Joe. This in my opinion can only be a good thing for the domain industry. I think there are some amazing ideas out there for new TLDs and that we will definitely see some success stories in the years to come!

Charlotte Gilbert, Dobhran Development - Bing will sell another chunk off oft the chinese or Google will invest a significant amount of dollars to salvage their competition (much like Microsoft did with Apple years ago).  Google will demand more out of website development with them releasing another serious Panda update..Mobile advertising will flood the market and users will continue to have adsense blindness forcing site/domain owners to be more creative with site monetization and design

Elliot Noss, CEO Tucows – In 2012 we will see continued efficiency come to the secondary market for domain names in two ways.

We will see existing distribution channels improve, primarily through more registrars and resellers integrating premium names into their results.

More importantly, we will see a significant increase in participation by large companies. Premium domains are moving from the legal department to the marketing department which is to the benefit of the whole market.

Braden Pollock, Legal Brand Marketing – With the launch of new TLD’s and domaining going a bit more mainstream, we’re going to see more players in the game and a lot more speculation of names. 2012 will be the year of the Registries and Registrars.

With parking revenues at an all-time low, new technologies will emerge that will breathe new life into parking and domain portfolios. (Hopefully, my new company will be leading the way)

Howard Neu C.O.O. and co-Founder, T.R.A.F.F.I.C. – I predict that the world will end, according to Mayan tradition on 12/12/12, so sell all your domains as soon as possible!

Juan Diego Calle, Founder .CO Registry / Straat Investments – .CO will continue a fast growth trajectory with a booming startup community building websites on .CO domains. The new TLD program will continue full speed ahead, helping us draw consumer awareness of the fact that legacy domain extensions are not the only option to build credible websites. Only a handful of TLDs will launch during the year (some brands & communities), but it will be step in the right direction.

Mike Mann, Founder, DomainMarket.com / Phone.com / SEO.com / Grassroots.org / MikeMann.com – .com will still be king.

Thies Lindenthal, IDNX (These are Thies’ personal views, not necessarily Sedo’s) – Bill Clinton’s wisdom “It’s the economy, stupid” holds absolutely true with domains. Predicting next year’s domain trends is as tricky as predicting next year’s economy. Domain markets are efficient, despite all randomness at the individual domain level. I do not claim that each domain is efficiently priced (yet), but general price trends for domains clearly follow the IT and advertising industry indicators.


About The Author: Elliot Silver is an Internet entrepreneur and his company earns revenue from domain names. Elliot is President of Top Notch Domains, LLC, a company that has sold seven figures worth of domain names in the last five years. Elliot is the publisher of DomainInvesting.com. Read this blog's disclaimer for information about the publisher, comment policy, disclosures, and conflicts.

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Comments (24)

    BullS

    @Howard

    Sell all your ASS-et, it is time to Party.

    Live life to the moment.

    Remember folks, this Domain is just a BS word game.

    December 28th, 2011 at 2:47 pm

    Brad Mugford

    My prediction.

    Despite all the hype, the world doesn’t end.

    Brad

    December 28th, 2011 at 2:59 pm

    AB

    Good post Elliot and great job getting all those replies.

    But as much as I like the quotes, I wish the registrars/media would expand on Paul Goldstone’s quote…

    “With all this talk of domain names, what they have still yet to hear much about is how domain names can actually be of measurable value to their companies outside of a virtual street address.”

    And really highlight the fact that domains can be bought, sold and transferred in the aftermarket. I’ve talked to a few people in real life and they had no clue that domains actually expire, let alone that they can be transferred.

    December 28th, 2011 at 3:00 pm

    Kevin

    The “easy” money days of domaining are over. Now you really have to know what you’re doing and have lots more business management, marketing and development skills to make significant money in this industry.

    If you thought 2011 was a whitewater rafting challenge to keep your domain investments profitable, 2012 is going to take it to an even higher level of challenge, as the global economy becomes immensely more chaotic and volatile.

    Keep lots of capital on hand. There will be incredible buying opportunities as desperate sellers grow even more desperate to raise operating cash and offer great domains at bargain prices.

    I think we’ll see many clueless domain investors who are peddling their dog crap domains for sale in forums and on Facebook finally call it a day.

    The unlimited gTLD concept is a clusterfuck and 99% of the ventures will fail and investors are going to lose a lot of money getting sucked into the get rich style pipe dreams these neverending flavor of the month extension schemes promote. There will of course always be the 1% who will make lots money from these deals.

    Mobile advertising is going to be HUGE in 2012! That’s where some enormous moneymaking opportunites are waiting to be mined!

    I think a lot of domain blogs are going to disappear in 2012. It’s pretty much gotten to the silliness point, where you see a dozen blogs saying the same thing every day such as “BREAKING! Sedo sells $2 Million of Domains”.

    And finally I think we’re going to see smart domain investors who realize it takes a team to truly build empires in any business, start forming coordinated JV development teams to build out their best domains one by one. The strategy Rick is doing by selling top domains with retained equity to well established corporate enterprises is one of the best forward thinking business models to emulate.

    One last note, the high end side of the domain market is going to see lots of incredible 6 and 7 figure sales in 2012!

    December 28th, 2011 at 3:43 pm

    Naji

    .com will be more important than ever with the new gTLDs.
    Parking domains will continue to decline.

    December 28th, 2011 at 5:13 pm

    Nadia

    Upside of 2012: Increased awareness and knowledge of the market, news coverage, etc. I don’t think lightbulbs will really go off until 2013-14.

    Overall trend: Slightly decreased values for everything but premium names.

    Winners: Buyers who recognize the opportunity, holders of “cute” typos and brandables like Supr and Coupo (for the first time ever). .ME and .TV, mobile apps, responsive layouts. Emphasis wil be on originality and brevity. I agree with Kevin’s points about JV and partnership. Those with developed properties will thrive.

    Losers: Three and four-word longtails. Traditional parking. People operating under the old “park & flip” model without any extra effort. Pigeon peddlers, although a new crop is always waiting in the wings – domaining, although difficult, has a low barrier of entry, and appeals to those needing to make some extra cash.

    December 28th, 2011 at 5:15 pm

    40z

    I’m a chart reader, and this great chart which Sedo posted really gives a lot of information. http://bit.ly/nWUMlm

    The market for domains does fluctuate with the financial markets, which only makes sense. So a prediction for 2012 will depend on an accurate prediction for the markets.

    The US is actually doing quite well coming out of the Great Recession, economically speaking. Europe on the other hand is not. So I will be particularly interested in seeing if the .de market continues to gain momentum.

    On the one hand, and I think this is actually reflected in the charts, there is some insulation for domain names during economic downturns, which spike unemployment. A natural consequence of fewer jobs available is people starting their own businesses in larger numbers. And of course the first thing anyone needs to today to launch a new business is a domain name. So in difficult economic times I would expect to actually see increases in domain sales, but at lower price levels. It probably takes the economy firing on all cylinders for the multi-million dollar dot com sales to regain the momentum the big ticket names have had in previous years.

    My 2 cents.

    December 28th, 2011 at 6:16 pm

    LindaM

    I think 2012 will be the year of the drop. Volatility creates instability and circumstance and I think it will continue to be a buyers market in the old tld’s.
    2012 will see volatility like no other year as there are going to be big corporate and possibly sovereign defaults. The bond market indicates this to be almost a certainty, the math no longer adds up whatever politicians try to do. So many countries have so much huge debt needing to be refinanced in 2012/13 that unless we reconsider what ‘money’ is then it just isnt mathematically possible.
    These big events will shake down into almost every aspect of many peoples lives like they already do. The difference now is there is not much more lean to cut from the bone in society and we see this on the news playing out in city squares and parks across the world. Sometimes with tents and flowers, sometimes with tanks and guns.

    This kind of upheaval always reveals opportunity, it is the nature of evolution to become stronger in adversity and the domain industry appears to have characteristics of evolution imo. Strong short names in .com or other mainstream tld like .me .tv etc that match the keyword well should increase or at least hold value because imo these have innate business utility just like a phoneline or a desk. The new tld rollout I hope is a roaring success and invigorates the internet, there is no doubt that some people are gonna get very very rich and a whole bunch more are gonna pay off their homes with it. Yes probably an even bigger bunch will lose their shirt but noone forced them.

    For people with hundreds or thousands of non-productive longassed .net,biz etc names Im thinking this year won’t be pretty unless they have other things going up to compensate.

    Wishing everyone a happy and peaceful New Year :)

    December 28th, 2011 at 9:40 pm

    LindaM

    Looks like I should just have said ‘agree with kevin, nadia and some others’ to save time as I wrote some of what they said but I read them after I posted. Yep right on people.

    December 28th, 2011 at 10:04 pm

    Billy Boi

    L-L-L-L-L (four-hyphen premium) domains will strongly outperform LLLLL (hyphen-less subpar-premium) domains.

    Likewise LNLNL names will gain significant momentum.

    December 28th, 2011 at 10:30 pm

    George Pickering

    My predicition…….Many website owners will turn to lead generation to more effectively monetize traffic and replace lost PPC revenue. I believe this pattern will continue in 2012 as domain holders with traffic pair up with lead generation companies who offer affliate payments that are well-defined, predictable, and far superior to what you get with PPC revenue – after all there is a reason all those lead gen companies appear at the top of many paid search results.

    For example, if you own a domain in the home improvement space – you can do an affliate deal with Servicemagic directly instead of sharing in a portion of the click fees Servicemagic pays to advertise on Google.

    2012 – Lead Gen begins to gain momentum on PPC

    December 29th, 2011 at 1:54 am

    wanda

    Rise of integrated keyword vertical ad networks This is pretty much the only way for advertisers to do brand advertising across the fragmented spectrum of blogs and other online hangouts for audiences, including social media. In the coming decade, vertical ad networks will get better at providing more value to advertisers through advanced technology for audit, measurement, analytics and optimisation.

    December 29th, 2011 at 4:39 am

    Fred Tappan

    Elliot,

    You’ve done a great job with this article and by getting everybody together to give valuable insights into the future of the domain industry. I’ve learned a few things! If more people had jobs we’d probably see a real boom in the domain industry.

    Thanks,

    Fred Tappan

    December 29th, 2011 at 8:12 am

    Glenn Madden

    I the best investment is into keyword domains that support an actual business selling products. The keyword rich web address per my results is still super power with Google.

    I have 500 plus names and most are related to our furniture business.

    By using one logo on all domains I have been able to create great sub sites that do not confuse the customer. Most are listed first page of Google for specific keyword address.

    Much better than paying CPC to get customers in the door.

    December 29th, 2011 at 9:05 am

    Rob

    Howard Neu is right!

    If you pay attention to what other top-domainers are currently doing you’ll see they are selling fast and cheap.
    Even Frank “‘ll never sell” Shilling is working a lot at domainnamesales and he linked internettraffic to the selling platform too…

    We’ve spoken in person with several top-domainers during the past months and we concluded that the best thing we can do now is enjoying these last 12 months with our families…

    December 29th, 2011 at 10:12 am

    Mark

    @Glenn

    Great strategy Glenn…I got tired of investing 1,000′s per month in online advertising and chose instead to purchase keyword rich GEO domains. I see other company’s in 2012 getting fed up in throwing away their marketing dollars and to realize they can still purchase specific GEO and keyword rich domains for their business and producing similar or even better results.

    December 29th, 2011 at 10:25 am

    Glenn Madden

    Selling is always good if you make some profit. But I doubt very many people are selling for the end of the world party. But if it works for the marketing go for it.

    Off the subject; Sorry Howard but I think we have a long way before the end comes.

    December 29th, 2011 at 10:28 am

    mike

    Hi
    My prediction .com will be the only tld worth buying. As for cctld .. I think you will see if not this year you will see it very soon a “Border ” mentality across the internet ,It is already starting to take shape … Nobody will be doing business in the us. Sopa, Extraditions from another country and so on .

    December 29th, 2011 at 4:29 pm

    NoobWorld

    My prediction for 2012 is that good end of the world domains will score high domain sales. End of the world websites will generate traffic out of this world.

    December 29th, 2011 at 6:22 pm

    Tommy Butler

    2012 Social media will start to play a big part on domains. matching up the brand of the name with the following accounts, twitter, linkedin google plus, ect. Sample

    Glasgow.com domain @Glasgow twitter Linkedin group Glasgow. building communitys for your brands.

    December 29th, 2011 at 7:21 pm

    Annalisa

    In response to Howard, and his Mayan Calendar prediction…it may be that 2012 is the end of the world “as we know it” I think people realize its definitely time to go .green In fact, 12/12/12 may be when delegation from ICANN goes thru. :-) Wish us luck!

    December 30th, 2011 at 10:25 am

    scott

    domains still drive bussiness to companies, new names from changing search patterns prove that a new million dollar site from nothing still is there.

    January 1st, 2012 at 7:11 am

    Glenn Madden

    We need more predictions of what domains will be worth in 2012, it is here. Happy New Year to Everyone.

    I think we will start to see more of the new TLD being used to categorize the Internet. In the past it has always been dot com.

    But the real key to Internet success is not the extension, not the marketing, not all the hard work that goes on behind the scenes. The key to success is BRANDING.

    I see a trend coming where people are not just buying dot com anymore. The xxx is a good example of BRAND categorizing.

    This might be a good reason to start selling dot com names, not the end of the world but it could be the end for dot com only investors.

    January 1st, 2012 at 5:37 pm

    RE: RE: RE: RE: RE: RE: RE:

    2011 was a great year for domain sales and parking, IMO. Parking saw a substantial lift from InternetTraffic.com and it’s effect on other parking companies. I see this trend for parking and sales continue into 2012.

    The real indicator though I think depends when/if the economy crashes in 2012. I think it will, but nobody can be certain.

    If the economy maintains, I generally predict domain sales to continue their strong sales trend of 2011, parking to continue to pay out more than before, alternative monetization ideas to come forward, and broader acceptance of domains as investments.

    If the economy crashes, then it will be a time of massive domain drops, a spectacular opportunity to back the truck up and load up on great generics, and reap less domain sales than 2011, but still enough to make it worth being involved in for the long-run payout.

    If we don’t get a crash in 2011 or soon afterward, I see nothing but blue skies for domain investors. This is the single best time, outside another crash, to buy domains since 2000, and 1996 before that.

    Someone noted the Chinese are showing up. I too have been seeing them more frequently on NameJet and GoDaddy, so they are showing up. Once we have the Chinese involved heavily in “buying American domains” you can bet that will ignite a fire and sharp rise in prices.

    I do think we will see an increase in abandonment of .nets and certain longtail, and brandable domains as they make less money in parking and as domain prices rise. There could be some real opportunities in those for lead gen or other uses.

    Lastly, I’m thinking we may end up getting some unexpected company to make a play for our traffic…..like Baidu.com or Bing or Facebook. It might happen in 2012, but probably not. However, it will come, there is just too much money and power behind domain names to be ignored. One thing we all know, everyone wants eyeballs. Without them no biz will ever get done. If you control the eyeballs you control money and power.

    Anyone second-guessing domains for 2011 and out longer is going to miss out.

    .

    January 2nd, 2012 at 9:37 pm

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