New gTLD Panel Summary from Domainfest – “When Will They Pay Off”

I had the privilege of moderating a panel at DomainFest on the topic of new gTLDs called “When Will They Pay Off”.  I was fascinated by the topic of this session, and when asked to help assemble panel, I was anxious to do so.   Our esteemed panel included Alan Dunn, SVP Acquisitions and Divestments, Domain Holdings.  Pinky Brand, VP Strategy & Partner Relations, TLD Registry Ltd., and Steven Kaziyev, Managing Director, YourBrand.com.  I have known each of the panelists for many years and knew that they would bring a different perspective to the conversation.

We agreed to keep our focus on the question from a domain investor perspective vs. profitability from the perspective of a registry or registrar.  With that in mind, we all agreed that we have no certainty when these things (domains) will page off. There are many unknowns.  Unknowns such as how will Google and other search engines handle the new TLDS.  Unknowns such as whether there will be click bias against new TLDs from the public. Unknowns such as our much traffic leakage there might be from websites using the new gTLDs to the .COM counterpart.  These are reasonable concerns that do need to be addressed.

I think the group was somewhat satisfied that Google would resolve technical issues regarding fairness to the new gTLDs, but only time will tell regarding the other concerns.

The panelist agreed that there would likely be a lift in value resulting from usage  provided there are many gTLD domains developed into quality websites.  Public awareness and a search engine footprint are requisites for acceptance of a new TLD. Those new TLD registries can influence a lift in value of their TLD by creating some market demand through smart marketing.

When asked what domain investors could do to increase the value of new gTLD domains, the consensus was to develop the domains into a quality website.  The analogy is that in real estate, developed property is usually worth more than undeveloped property.  There were different views expressed regarding how fast an investor should develop with a new domain.  Do it fast and you seed the search engines with indexed websites that create visibility with the public, and you might even get a marketing boost from the registry that is looking for shiny websites to highlight their TLDs.  Another view was to take a wait and see approach and then invest in the gTLD, which has had some public interest demonstrated.   The later approach is less risky and time consuming.

The panel recognized that building and managing a website is hard work and does require skill sets that many domain investors do not have.  They advised to find contractors, employees, or partners to make things happen right.  Pinky Brand told the story of Blinds.com which was involved in.  The domain owner paired up with a local window shade and blinds company who had not internet presence.  Together they are doing great business on an awesome website using a fantastic domain.  That is thinking out of the box!

When asked to speculate on the whether the future value of a new gTLD domain investment would be worth in 1 year and 5 years from the time of investment, the panelist all pointed to past with other TLDs.  In general, all domains appreciated in value regardless of the TLD when developed.  That makes sense as you gain backlinks, page rank, repeat visitors, and brand recognition.  Pinky reported the success of a very recent domain name auction of new Chinese character gTLDs has raised US$182,000 from 33 auction lot sales. Bidders in the room and around the world paid between US$2,000 and US$25,388 for valuable Chinese character domain names in the Dot Chinese Online (.在线) and Dot Chinese Website (.中文网) TLDs. More people from around the world are coming online and domains are the best investment for a business brand, so values should only go up.

Steven Kaziyev, projected that multi-keyword .COM domains might actually increase in value because of some TLD confusion.  He explained that each new gTLD domain likely would have meaning on both the dots as in <Accountants.club > would like experience traffic leakage to <AccountantsClub.com> and that the owners of these new gTLDS would want to protect their investment by securing the .COM version of the domain and perhaps pointing it to their new gTLD website.  This has me reconsidering my view on some longer tail .COM domain investments.

I enjoyed moderating this panel and appreciate the contributions of each panelist and DomainFest for giving the topic a forum.

When do you think these new gTLDs will pay off? Your comments are welcomed.

 

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