Leo Mirani and David Yanofsky wrote a very thorough piece for Quartz on the new gtlds.
Their article titled, “The biggest land rush in the history of the internet starts on February 4”
The article did a nice job in the set up and background of the program, then they took a look at the existing tlds and their reach on the Internet.
They looked at new tld applicants and talked about “Free Money Forever”
From the article:
Free money, forever
For its owner, setting up a generic top-level domain is the online equivalent of opening up a vast—in fact, essentially infinite—tract of previously virgin land for development, except that the real estate in question has been conjured out of thin air. In addition to the $185,000 application fee to ICANN, the cost of lawyers, research, traveling to ICANN conferences, and other administrative expenses brings the total cost of an application up to about $1 million, according to one applicant.
But once the initial investment has been recouped, the profits, in theory at least, can be enormous. Whoever wins a top-level domain (say, .news) can sell second-level domains (say, qz.news) on it. Daniel Negari, a 28-year-old American who made his first fortune selling real estate, is planning to make .xyz a generic domain name that anyone can put at the end of any website. Negari thinks he can sell a million second-level domains in his first year of operation, at a price of less than $10 each. (By contrast, .com domains go for $12.99 on GoDaddy, the leading retailer of domain names.) That would be $10 million in revenue in the first year alone.
They also took a look at the current ICANN balance sheet and the $225.8 million they have left over after expenses related to implementing the new gtld program.
From the article:
It won’t be pure profit. ICANN takes a cut of 25 cents per second-level domain sold, plus extra fees every quarter and every year. Then there are technical and administrative costs. Still, the applicant for .ninja forecasts margins of around 90% (pdf p.13).
And Negari’s .xyz will be one of the cheaper deals on offer. The .guru TLD is open for pre-registrations (before it officially opens to the general public) on GoDaddy for $39.99 per year. A domain on .ventures is $69.99. One on .luxury starts at $799.99 per year. The enterprising folks at .sucks are asking for $25,000 during the “sunrise period,” a 30-day span during which trademark holders can register their domains to avoid domain-squatting.
They also do a good job with getting opinions from both sides. I have to say this is a very complete article and these two gentleman did an excellent job in their piece. If anyone is asking you about the new gtld program who is outside domaining, I would certainly recommend you forward them the article.
Read the entire article here
Ramahn says
Sorry, at $10 .xyz is still not a bargin. There is still plenty of gold (Read: opportunity) left in .com for cheap in the aftermarket or even in hand regs. yes hand regs. And on that note, I haven’t paid $12.99 for a godaddy (hand reg) name in over 2 years. I usually pay $1.99 ($2.17) or .99 ($1.17) with about 5 minutes of googling/Twitter search of “godaddy codes”. Just sayin.
.sucks & .luxury those guys are out of their mind. Puff puff give.
Dom Nics says
How one sided, narrow minded and greedy can you get?
Did they bother to ask where these buyers are?
So the can sell a million in their first year? WOW amazing!
Do the create buyers out of thin air too like they did the gTLD?
Yes, Godaddy et al can create lots of bullshit and make they are big enough to create a self fulfilling prophecy. They are also big enough to create a bubble that will burst.
Sorry – we have not even tapped the market of hyphenated .coms yet… there is plenty of steam in the old horse yet.
Of course this is not to mention the fact that Google and smartphone have removed the need for domains anyway…
Lemmings spring to mind.