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I Disagree With Sedo’s Observation

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I read a press release from Sedo today about the company’s recently launched Internet Domain Name Index (IDNX), and I disagree with one of the observations that was made.

According to the press release:

The bigger the better. The .com extension, which targets the entire world, has outperformed regional champions. Even successful country-code Top Level Domains (ccTLDs) like .co.uk and .de have not kept pace with .com since 2008. This casts some doubt on the viability of new regional TLDs that have been proposed, such as .nyc (for New York City).

My issue is that I don’t think a new gTLD, especially regional gTLDs like .NYC or .PARIS, will need to keep pace with .com to be viable. I happen to think that with a local marketing campaign, awareness efforts, and some development by local businesses, people in New York City will know about .NYC, and local businesses will purchase .NYC domain names.

As a result of these efforts, the gTLDs will be purchased locally, and while they certainly won’t sell at the same pace of .com, they will sell. From my perspective, they don’t have to sell nearly at the same clip as .com to be considered successful, let alone viable. With the right price structure and smart management, many niche gTLDs can be not only viable, but also profitable.

Antony Van Couvering is CEO at Top Level Domain Holdings, the company that operates gTLD consulting firm, Minds & Machines, and he is also CEO of dotNYC, a group that hopes to win the rights to manage .NYC. I reached out to Antony Van Couvering for his feedback on the viability of niche gTLDs in light of the press release.

Sedo makes some good points, about management, about “me-too” not working, and so on. Conceptually, though, it’s hard for people to escape the .com model in measuring success — that measure being naked volume of names under management. Obviously .com is successful, and its enormous volume makes it so, and I agree with Sedo that it will be along time, if ever, before it is surpassed on that score. But to say that “this casts some doubt on the viability of new regional TLDs” is like saying that Apple can never succeed because Microsoft is so entrenched, or that Armani is doomed because Wal-Mart is so big.

The point is often made that that not all success is monetary, and .cat and other “public service” TLDs are brought into evidence. Even from a financial point of view, however, a small TLD can do very well. If .CPA is sold to certified public accountants at $200/yr, it doesn’t take many to join before that’s a great business, especially with a better cost structure than incumbent registries have.

In the United States, .com is habitual (which is not the case in the rest of the world). New gTLDs in general will break that habit, because people will begin to ask themselves, “what’s the extension.” Once that happens, people will begin to examine the extension on its merits, instead of just relying on .com as a universal. Once any one of these new gTLDs, because of great marketing, a compelling bundled application, or some method, challenges the “habit” of Americans to just type .com after a name, the game is wide open, and people will begin to look at the meaning and use of .com instead of just its ubiquity.

I welcome your thoughts on this topic.


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 (15)

    RH

    I agree with you Elliot, the notion that things have to keep up with .com is nonsensical. Its like saying a Honda will never be a Ferrari. Who cares ?

    New niche extensions have to decide what their business model is and make that model work. Some will succeed and some will flop just like everything else in business.

    November 16th, 2011 at 3:42 pm

    Uzoma

    Hi Elliot,

    I’m with Sedo on this. In the domain field, success of a TLD, g or cc, is measured in ‘universality’, not regional. Yes, some extensions will achieve exotic successes, but success is when you don’t have to ask “What’s the extension”?

    I disagree with Van Couvering in thought, not meaning. The proper analogy, in this case, would be Beauty Pageantry; in the quest to get to Miss Universe, or Miss World, various localities hold pageants, and choose Miss Alabama, or Miss Oakland, or Miss Timbuktu, or Miss-what-have you, however, those beauty queens have their eyes ultimately at the universal title, to feel accomplished.

    Who needs .nyc or .la when they have a yellow pages? Besides, the businesses on those tiny tlds are still present in the .COM.

    I am in no way knocking some of the ccTLDs’ existence, I’m only pointing out that Van Couvering’s thoughts are off. the analogy he is basing his thinking, though pretty, is flawed.

    November 16th, 2011 at 3:53 pm

    Rich

    I olso disagree with sedo.
    I think it’s a wrong analogy to compare .com with .de or .co.uk with .com or any other cctld with .com.
    Reason is that .de it’s bigger then .com in Germany and co.uk bigger then .com in England.
    .NYC could be a success in US but nothing compare to .com,because it’s limited.

    November 16th, 2011 at 4:13 pm

    Tom G

    I’m sorry, but roflmao at

    ‘Who needs .nyc or .la when they have a yellow pages?’

    I don’t even know when the last time my mother in law picked up a yellow pages. probably 2005.

    November 16th, 2011 at 4:20 pm

    David J Castello

    I agree 100% with SEDO.

    We are getting many offers for our mega-generic names from companies that own the same word in their respective country’s ccTLD. Their reason is always the same: their revenue is limited without owning the dotCOM version.

    DotCOM is, and always will be, the universal and default TLD. Businesses are becoming aware how much difference it can make to their bottom line and in this economy every dollar counts.

    You’ll see the same thing happen with dotNYC and dotParis.

    November 16th, 2011 at 4:25 pm

    Uzoma

    “I don’t even know when the last time my mother in law picked up a yellow pages. probably 2005″. – Tom G

    Tom G,

    That’s exactly the point. With the .nyc or .la thing, it’s almost like telling your mother to pick up the yellow pages again, albeit in digital form.

    You see, somebody’s got to tell ICANN that there’s only one internet! They don’t don’t seem to get it. By dividing up the internet into various Bantu lands, ICANN is doing a disservice to all of us. The internet is really supposed to be one contiguous environment. Left to me, there should have been only one tld: .COM!

    If any country is jealous of the American domination of the internet, tough! They should go and invent their own internet.

    November 16th, 2011 at 4:35 pm

    theo

    Well Sedo is off with the gTLD statement to a certain extend.

    They looking at the numbers and the numbers give them doubt.

    But the numbers do not tell the entire story and that’s where they are off.
    In the press release there is no mention of the ccTLD dot NL.
    And judging the numbers they are correct.
    However alot of deals in the Netherlands are private deals that never make it to any list.
    Granted alot is peanuts but the bigger sales that took place this year above 25k never made it on Ron Jacksons list and sure as hell didn’t take place thru Sedo.

    I think those city gTLD’s will do just fine. If there is a good aftermarket or good sales, that remains to be seen. But that is not the deciding factor if it is a succes or not.
    Sure for Sedo it works different. For Sedo tons of sales thru Sedo is succes 😉

    November 16th, 2011 at 4:42 pm

    RH

    David that has nothing to do with the viablility of .nyc.

    Yes you have great domains and will continue to do well IMO.

    That does not mean your success is .nyc’s failure.

    They can co exist and will co exist imo.

    Just the very fact that .com is nowhere near as popular in their example countries of .de and .co.uk proves that extensions can co exist and attain their own levels of success.

    November 16th, 2011 at 5:21 pm

    David J Castello

    @RH
    I agree with you. These new TLDs will work in certain situations, but they can also become a marketing liability for others.

    Take dotNYC and dotParis, for example. In a positive light, they could add more “authenticity” to a local business brand. On the other hand, that same business could also be viewed as “provincial” in the bigger picture – and that is never a good thing if you’re gunning for the bigger picture.

    I became fascinated when owners of generic words in their ccTLD consistently wanted our dotCOM version – even though they were already at the top of the search engines. This spoke volumes to me.

    November 16th, 2011 at 5:35 pm

    Duane

    Take dotNYC and dotParis, for example. In a positive light, they could add more “authenticity” to a local business brand. On the other hand, that same business could also be viewed as “provincial” in the bigger picture – and that is never a good thing if you’re gunning for the bigger picture.

    David hit it spot on!
    Every business wants to be THE Autority! People dont even use there ” dot US “ccTld. Who wants to limit business with in a city?

    Does anyone in the U.S. type “Hotels.DE” in there browser if looking for a stay in Germany? I dont think so. So the question is, why not?

    Using WHATEVER.NYC would give people the impression that your limited to providing service within this geo area. Which automatically makes a mom and pop business impression.

    There are to many psychological obsticals to overcome when wanting to make any new GTLD a true winner.

    November 16th, 2011 at 6:11 pm

    Tom G

    Not every website operator is global, or wants to be. Many small businesses ARE strictly local and exclusively target local traffic. More are developing sites every day.

    Vertical Integration makes new business models possible. Web services are big business, ask GoDaddy.

    They won’t pass .com in volumes and it might not make domain investors a ton of cash, but the vertically integrated .NYC Registry/registrar will do just fine.

    Not everyone puts the threshold for ‘viability’ at $6 billion.

    I’d be happy with .01% of that.

    BTW SEDO is owned by United Internet, who also owns UnitedDomains.com where you can go and request preregistration for new gtlds. They are playing both sides.

    November 16th, 2011 at 6:53 pm

    craig

    Who wants to limit business to a
    one city?
    Well for one, anyone advertising in the yellow pages for that city.
    For local biz, I think .la and .nyc will do just fine. Searchers will learn they can avoid the horrendous mess that .com search has become, and “go local” by using their city code.
    I even suspect a certain amount of local pride and loyalty might creep into the equation.
    If you were a corporate attorney in Los Angeles, wouldn’t you want corporate attorney.la as part of your online presence?
    I sure as hell would………

    November 16th, 2011 at 9:15 pm

    Raj

    .com is like ‘windows’… Obviously, its share would be high. But it just takes one wrong move (read: ‘vista’) to make people move away from it. If .com chooses to hike their yearly subscription rates as reported on this website a few weeks back, that single move would help all the other TLD’s.

    November 17th, 2011 at 1:25 am

    Steven Swimmer

    I agree that new extensions can be viable within some niche areas. But I also see that end-users have a learning curve and run from change.

    The niche extensions that make sense will get traction, but there will be a lot of noise, which will create confusion and fatigue for some users.

    The bottom line: businesses will have to weigh the relative value of a decent niche domain name vs. a weaker .Com. Will they see the kind of traction that they expect? This will be the test.

    November 18th, 2011 at 5:11 am

    NewTLDs.com

    I guess alot depends on how well Google will rank the new TLDs geography in its local search pages

    November 24th, 2011 at 6:14 pm

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