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Great Aspect of gTLDs for a Domain Investor

18

There are a number of reasons why I support the implementation of gTLD domain names, but I want to discuss the primary reason I am excited about them as a domain investor. I think investing in gTLDs will be  highly risky, but with that risk comes the potential for significant financial reward.

For the most part, we don’t know for certain how quickly (or even if) gTLDs will take off with consumers and marketers. Perhaps gTLDs and brand TLDs will become used extensively and the result will mean higher values for good and relevant domain names. Conversely, just as easily, gTLDs could ne shunned by marketers and brands, and as a result could languish on the “shelf” at domain registrars.

It seems that everyone who invests in domain names has a very firm opinion on the matter, but irrespective of the person who is opining, it’s an educated guess and nothing more. My personal opinion is that TLDs like .aero and .museum do not foreshadow the dawn of new gTLDs, so I don’t think they can be cited as proof of an impending doom for new TLDs.

I see some smart money investing in relevant new TLD domain names as extensions like .CO, .ME, and .XXX come available, but I also see plenty of smart money sticking with .com as well. gTLD investing is certainly a polarizing topic, to say the least.

With that being said, there is and will continue to be considerable opportunity, but the costs are high. From the perspective of most, investing in good, new TLDs is expensive and out of reach. Although Meet.ME sold for $450k, how many people in the domain space (aside from full timers) would have been willing to invest thousands of dollars in a speculative investment like Meet.ME? Not many.

There is significant risk involved with investing in new TLDs, but there will likely be significant rewards for those who take the financial risk. There will always be people buying liabilities, but for those who invest wisely, the potential is high. The key is to invest wisely and invest if you know what you’re doing. If you plan to develop, well, have at it. But if you’re buying as an investment, be smart.

Investing in gTLDs isn’t for the feint of heart, but it’s one hell of an opportunity that we all have right now.


About The Author: Elliot Silver is an Internet entrepreneur and publisher of DomainInvesting.com. Elliot is also the founder and President of Top Notch Domains, LLC, a company that has sold seven figures worth of domain names in the last five years. Please read the DomainInvesting.com Terms of Use page for additional information about the publisher, website comment policy, disclosures, and conflicts of interest.


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Comments (18)

    Brad Mugford

    The main problem is who really trusts ICANN to put public interest before their own financial interest?

    Should an extension exist who’s only core function is to make the registry itself and ICANN money? With limited actual benefit to anyone else?

    For instance an extension that is not supported by the community, and markets to TM holders.

    ICANN has put themselves in position of picking winners and losers and that is the major issue.

    Brad

    December 12th, 2011 at 2:41 pm

    Tom

    What about the downside? flowers.mobi?

    December 12th, 2011 at 3:08 pm

      Elliot Silver

      @ Tom

      Yes, that is what I mean about risk. There is significant risk, which could lead to financial loss. Those who can’t afford to lose (or put out cash for a potentially long period of time), shouldn’t invest. Simple as that.

      December 12th, 2011 at 3:12 pm

    Tom

    .biz seems to be a bust, .us seems to be losing much ground as well, to many extensions for product, just domain traders trading junk, other than the obvious generic?

    December 12th, 2011 at 3:08 pm

    theo

    Brad can you explain this picking winners and losers some more ?
    The gTLD application process is rather transparent imo.

    December 12th, 2011 at 3:45 pm

    Brad Mugford

    Who makes the ultimate decision? ICANN.

    Who is accountable over ICANN? Pretty much no one.

    The program is about to rollout, and there are so many unanswered questions it is laughable.

    Brad

    December 12th, 2011 at 3:47 pm

    Ms Domainer

    *

    The big money (for new gTLDs and ccTLDs) seems to be decided behind closed doors BEFORE launch. The big money keywords seem to be “reserved” or allocated to “founders.”

    IMO, the fix will always be in.

    Not for me.

    *

    December 12th, 2011 at 4:25 pm

      Elliot Silver

      “The big money (for new gTLDs and ccTLDs) seems to be decided behind closed doors BEFORE launch. The big money keywords seem to be “reserved” or allocated to “founders.””

      @ Ms Domainer

      If you can afford to take the risk and believe in a certain investment, that’s how you get deals done. Venture capitalists and angel investors don’t wait for a company to go public to invest. They make great offers to the founders and owners of private companies to get their feet in the door before others.

      December 12th, 2011 at 5:08 pm

    Tom

    I agree with the big money theory, getting their cream of the crop, but they are also putting their own money up good or bad, so it goes both ways. You have to pay to play, with anything, I think .xxx other than the obvious generic terms is going to be a headache.

    December 12th, 2011 at 4:31 pm

    Tony

    I think the real great benefit of having gtld’s is the diversion of investor attention from dotcom.

    I picked up on the drop amongst others, AsbestosCalifornia.com yesterday. Advertisers are willing to pay $106 CPC for the term and I got the dotcom for reg fee.

    Steal.

    December 12th, 2011 at 7:26 pm

    Phineus

    The entire gtld will be a huge dot fail ala .mobi, .tel, .pro, .museum and numeorus others.

    Why would anyone think otherwise?Every day that that silly proposal gets delays will solidify .com’s stronghold even more.

    Someone pinch me if I am missing something!

    December 12th, 2011 at 8:45 pm

    David J Castello

    I would be extremely, extremely careful about investing in new gTLDs. Most domain investors are going to find a far different world than dotCO and dotXXX. Both of those were launched with basically zero competition. These gTLDs will be launched along with hundreds of others. This makes a huge difference in the aftermarket.

    If the timetable stands as planned, these gTLDs will be available in early 2013. Unless you get a great offer, hold your dotCom names until 2014. That is the year they will spike in value. DotCom and certain ccTLDs will be the eventual winners, but some blood has to be spilled first.

    No matter what “assurances” anyone tells you, there will be gTLDS going belly-up. This has never happend before and when the first one goes it will set off a shock wave that will cement dotCom as the gold standard in our industry.

    December 12th, 2011 at 9:37 pm

    Robert Cline

    GVN.Co Sold for $1,500.00 – Private sale

    my sale.

    short LLL.Co mpany domains are beginning to take off.

    December 13th, 2011 at 4:10 am

    ORM 101

    Yes. See. Once again, the REAL domain game is a rich mans’ game. The rest of use will fight like hell to get there, but, as stated, you have to have some real money to make a good, solid investment (this late in the game). I’ve gambled on some of the new TLDs and I’m hoping they’ll pay off, but we’ll see.

    December 13th, 2011 at 11:08 am

      Elliot Silver

      “the REAL domain game is a rich mans’ game.”

      @ ORM 101

      Any type of investing is a “rich man’s game.” If you buy some shares of stock for a few hundred $$, you need to hope the stock goes up enough to cover your purchase and sale fees. If you invest $500 and pay $20 a trade on the buy and sell side, you need the stock to appreciate in value 8% just to cover your trading costs.

      IMO, people who don’t have the money to lose, shouldn’t be investing in anything. If someone is struggling to feed their family and clothe their children, they should not be spending money on domain names.

      December 13th, 2011 at 11:12 am

    ORM 101

    I’m glad you agree. I’m not trying to be confrontational, just saying how it is for us trying to get into this world. I love it and will continue to try, but the game was bought up many years ago by people lucky to have been there. Yet, I know there was risk there too. I’ve invested a little and will see what happens. I also like development a lot (passionate about it) so that might be another road in. Thanks for your blog BTW.

    December 13th, 2011 at 11:35 am

    Philip

    Invest in a coampany with an experienced management team who have the resources an really understand the market.

    One company ive heard about is TLDH which is the only company listed on the London Aim exchange.

    They have the ex head of ICAAN peter Dengate Thrush as part of there management team as well as the highly knowledgeable antony van Coevering, one of the people who help set up ICAAN.

    Thats the way to invest in the new gTLDs.

    December 23rd, 2011 at 4:57 am

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