opinion How well are the new extensions doing?

lolwarrior said:

I would conclude that no one really knows what will be in 10 years. Many things are uncertain with new gTLDs. Only this much is clear

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We are headed into 5 years this February, in the beginning it was give it 3-5 years, and that is exactly what many have done.

I remember the .guru launch, people were buying the big keywords like doctor for day 1 EAP at $12,500 etc.. and there was chaos with registrations being assigned to the wrong backordered parties. People were going to develop their .guru into big things, others were going to start investment portfolios, none of this happend. Sales were good in the early days as nobody knew what was happening, or going to happen.

Radix has always been strong on pricing their renewals, Donuts let some early stuff slip thru, they have fixed those issues, and are now reserving all the good drops. As well as being under new management, I would look for them to find new revenue streams at the expense of their current customer base.

I know many people are hyped about .web, but it is really the same as .net, they mean the same thing, and we all know how good .net is doing.

There was a huge .mobi drop today, nobody cared.

Now if someone is going to take the gtld route, if keyword.direct is taken fine, they can go to keyword.solutions, or keyword.services, the people who are going to pay reg fee, will pay fee. The buyers who need the high match term most of which are held by the early EAP buyers, or the people that bought off the registry reserve list, or the underlying registry themselves are going to get that sale. The domainers who invested across the board are baiscally using their sales to recoup investment fees of losers, and the higher premium model. Some might come out more ahead with a few outliers, but for the most part it's a wash. You can't cover enough ground with a low enough annual renewal, to really get any skin in the game.

Internet.Domains said:

Ten years ago if someone mentioned Google and Amazon would be using extensions other than .com, .net and .org they would think you hit your head hard.

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And if you say that ten years from now Google will be using their doc.new domain, I would think that person hit his head hard. (Joking, of course.)

The real issue isn't whether or not Google or Amazon uses the TLD. The real question should be whether Google users and Amazon users use a new TLD. Because those people are likely our future customers in the making.

Rick Ace said:

And if you say that ten years from now Google will be using their doc.new domain, I would think that person hit his head hard. (Joking, of course.)

The reason issue isn't whether or not Google or Amazon uses the TLD. The real question should be whether Google users and Amazon users use a new TLD. Because those people are likely our future customers in the making.

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Regarding, "whether users will use a new TLD."

So far users have shown they will use a New TLD. Google with Doc.New (as you mentioned) and Amazon with Amazon.Jobs. I have not heard of "users" not open to using these domains. The larger issue is awareness and time can perpetually fix that. It should also be noted that many top companies have stashed, for future use, New TLD's. An example being Microsoft with Computer.Systems.

Internet.Domains said:

Regarding, "whether users will use a new TLD."

So far users have shown they will use a New TLD. Google with Doc.New (as you mentioned) and Amazon with Amazon.Jobs. I have not heard of "users" not open to using these domains. The larger issue is awareness and time can perpetually fix that. It should also be noted that many top companies have stashed, for future use, New TLD's. An example being Microsoft with Computer.Systems.

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That's a good point.

It makes me wonder how long these companies can keep these stashed though.

It is about time to stop calling nTLDs "new" as at this point they are just another 500 extensions we did not have in 2013. It is also time to stop lumping sales from 500 extensions into one bucket and comparing that to .Com sales. Each extension and domain type (one word, LLL, NNN, etc) needs to stand in its own. We do not group .info and .biz in the same bucket as .net and .org as sales in the former are extremely rare.

Chinese investors seem to still be buying short .Top domains but I am not sure how healthy the aftermarket is for one word .Top domains (end user purchases). A large portion of Ntld sales continue to come from registries which often are suspect.

Remember all the hoopla about vacation.rentals? Try actually looking for a rental for a travel destination and you will see that site is a joke. $500k for a site which cannot even list a dozen options near your desired location. Domain purchases should be a fraction of the development cost not the other way around.

garptrader said:

It is about time to stop calling nTLDs "new" as at this point they are just another 500 extensions we did not have in 2013. It is also time to stop lumping sales from 500 extensions into one bucket and comparing that to .Com sales. Each extension and domain type (one word, LLL, NNN, etc) needs to stand in its own. We do not group .info and .biz in the same bucket as .net and .org as sales in the former are extremely rare.

Chinese investors seem to still be buying short .Top domains but I am not sure how healthy the aftermarket is for one word .Top domains (end user purchases). A large portion of Ntld sales continue to come from registries which often are suspect.

Remember all the hoopla about vacation.rentals? Try actually looking for a rental for a travel destination and you will see that site is a joke. $500k for a site which cannot even list a dozen options near your desired location. Domain purchases should be a fraction of the development cost not the other way around.

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I would be open to a "NEW" name change if that would make some feel better. Just don't call them "Non .com"....That was beyond a disaster when Donuts pulled that one.

I see that a number of ngTLD sales that fell in the reporting period have been added late to NameBio, and some others in DNJournal but not NameBio, yet at least. I don't go back and insert late additions, but if I did these would make the volume pretty well equal to recent months (but not the number of sales).

Momentum is challenging to define, and clearly evidence can be brought to bear on either side of argument. I would point out that within the last month all of the following happened ....

1. 2nd highest sale ever in .online (design)
2. 2nd highest sale ever in .host (Wiz)
3. highest sale ever in .space (air)
4. highest sale ever in .app (dispatch)
5. 3rd highest sale ever in .network (edge)
6. highest sale ever in .express (service)

So the new extension picture is not totally negative.

Bob

Bob Hawkes said:

I see that a number of ngTLD sales that fell in the reporting period have been added late to NameBio, and some others in DNJournal but not NameBio, yet at least. I don't go back and insert late additions, but if I did these would make the volume pretty well equal to recent months (but not the number of sales).

Momentum is challenging to define, and clearly evidence can be brought to bear on either side of argument. I would point out that within the last month all of the following happened ....

1. 2nd highest sale ever in .online (design)
2. 2nd highest sale ever in .host (Wiz)
3. highest sale ever in .space (air)
4. highest sale ever in .app (dispatch)
5. 3rd highest sale ever in .network (edge)
6. highest sale ever in .express (service)

So the new extension picture is not totally negative.

Bob

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Half of those sales are sub $10K, the other higher ones majority are registry direct sales.

That is not impressive for highest reported for non registry sales.

The average for the 6 was $15,948. That is about 18 times the average price of .com sales on NameBio during the same period, and roughly 45x the median .com sales price during that period. But the point was not that these were major sales (only 1 of them is high enough to make the top 30 ngTLD sales in 2018 YTD). They are not insignificant sales, but you are totally right that only 3 of the 6 are above $10k.

My report had indicated that number of sales was less than the average of past months, and registry continue to take more than half sales revenue (although less than 20% of sales numbers). Just pointing out that if looking for optimism there are some encouraging signs as well, some off which were not known when I put the report together. I think it is important to present both positive and negative aspects,when evidence warrants it, and take a balanced view.

Internet.Domains said:

Ten years ago if someone mentioned Google and Amazon would be using extensions other than .com, .net and .org they would think you hit your head hard.

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Which consumer facing sites? I just know Google.com, Amazon.com. A real story would be if they switched those sites to another extension. And sure enough the new one you mentioned, doc.new, is just a redirect to docs.google.com.

JB Lions said:

Which consumer facing sites? I just know Google.com, Amazon.com. A real story would be if they switched those sites to another extension. And sure enough the new one you mentioned, doc.new, is just a redirect to docs.google.com.

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I did not use the word "consumer facing" in my comment. My point is both of those companies are using the new extensions in some sort of manner.

I don't expect most big companies to ever go away from .com as their major company website (I could be wrong, of course!). What I think we may see is them use other extensions for marketing purposes as Apple did with experience.Apple using their brand extension. I think Amazon is fighting so hard to get to use Amazon as a brand extension to do that too.

Amazon is using a whole bunch of ngTLDs for targeted redirection purposes - like Amazon.christmas, Amazon.dog, Amazon.today and a dozen or more others - even Amazon.horse. They don't just redirect you to Amazon main page, but take you to something related to that term. Apple just does that a little, with Apple.news and Apple.technology for example.

Google is the hardest to see what their corporate strategy really is. Using abc.xyz for investor relations seemed a statement. The extensions they own seem to be a mismatch of maybe good ideas and hard to fathom extensions, many of which they haven't even put into use. Now they have begun using ngTLDs as document shortcuts, which is innovative, I guess, but not sure.

Facebook.design is a nice site but not sure beyond that Facebook is doing much with new extensions in a meaningful way.

Bob

Internet.Domains said:

I did not use the word "consumer facing" in my comment. My point is both of those companies are using the new extensions in some sort of manner.

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I know, point is they need to be in front of consumers to gain traction. And yes, they use them, many times just as redirects tho.

JB Lions said:

I know, point is they need to be in front of consumers to gain traction. And yes, they use them, many times just as redirects tho.

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Everything usually starts somewhere.

Bob Hawkes said:

The average for the 6 was $15,948. That is about 18 times the average price of .com sales on NameBio during the same period, and roughly 45x the median .com sales price during that period. But the point was not that these were major sales (only 1 of them is high enough to make the top 30 ngTLD sales in 2018 YTD). They are not insignificant sales, but you are totally right that only 3 of the 6 are above $10k.

My report had indicated that number of sales was less than the average of past months, and registry continue to take more than half sales revenue (although less than 20% of sales numbers). Just pointing out that if looking for optimism there are some encouraging signs as well, some off which were not known when I put the report together. I think it is important to present both positive and negative aspects,when evidence warrants it, and take a balanced view.

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Lets keep the facts straight, and not skew the results with outliers.

In order to be an investor, you have to be honest with the facts first, and foremost.

1. 2nd highest sale ever in .online (design) $57,500 REGISTRY SALE
2. 2nd highest sale ever in .host (Wiz) $3,000
3. highest sale ever in .space (air) $17,500 REGISTRY SALE
4. highest sale ever in .app (dispatch) $15,000 $480 ANNUAL RENEWAL
5. 3rd highest sale ever in .network (edge) $7,515
6. highest sale ever in .express (service) $5,125

So taking out the registry sales 1,3 we get an average of $37,500 for the registry. Which is great.

We are left with 2,4,5,6 where the average price drops to $7,660 which is decent, but when comparing the highest, or top 3 best sales in such extensions that is not good from an investment point of view.

The risk here is you have to buy quality, and a lot of it, with higher than average renewals, with lower than average sell thru rates. The numbers don't add up for the average investor. For the registry they make sense because they can hold back the best keywords, put high renewals on them, or reserve them in the drops. All of which they are doing, unless it is already released, majority of domainers are just carrying the subpar inventory hoping to make a few hundred on them. Many are buying on promo registration discounts, and many get auto renewed at full renewal. Extensions are nothing new, .biz is a great extension, so is .info, .mobi had buyers lined up, but they all failed eventually. Nobody wants to take that information at face value. People are still going to get lucky in getting a decent sale on their keywords, but those are going to be few, and far between which makes it very hard to win your renewals over sales ratios.

Just quoting myself from the report that started this string in the discussion:

I kind of think I made sure to point out that the big sales were dominated by registry sales, but maybe I needed to say it 5 times in the report?

I think the long term health of ngTLD universe is helped even by registry sales, as long as they go to businesses that actively use the domains in a high profile way (like the design.online is already doing). I know that the argument can be made that they compete with individual investors, but I rather see it that registry sales can help grow the market as well and make the case for high prices. For that reason I think that the critical question is are ngTLDs getting used, and registry sales should not be ignored. It was in that context that I presented the data. I presumed that people would realize that many would be registry since we have said that many times, including in the report referenced in the thread, that the big value sales are registry dominated. I certainly never said or implied they were NOT registry sales in this thread.

Bob

By the way, I do agree with almost everything you wrote in your last paragraph. i.e.

wwwweb said:

The risk here is you have to buy quality, and a lot of it, with higher than average renewals, with lower than average sell thru rates. The numbers don't add up for the average investor. For the registry they make sense because they can hold back the best keywords, put high renewals on them, or reserve them in the drops. All of which they are doing, unless it is already released, majority of domainers are just carrying the subpar inventory hoping to make a few hundred on them.

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It's a nice summary of the challenge of ngTLD investing. It is almost impossible to make the numbers work for holding premium renewal rate, even with crazy optimistic price and sales projections. That leaves the names either in extensions that don't charge premium renewals, or finding gems the registry missed (tough but not impossible). I think when you talk a few hundred that is where the main growth of the ngTLD market will be in the next 4 years. Creative types, one person companies, non business users, marketers, etc. will be looking for something a bit better than hand reg. Selling enough at a high enough margin won't be easy. However, at least to the degree NameBio represents the market, the median price for all extensions is typically less than $400 so it is not really different from most sub-prime com sales. In fact my wrap-up highlighted comment in the paper at the link said (based on thinking similar to yours):

I argue that for diversification purposes holding a few quality ngTLDs without premium renewals might make sense. Or for those who are passionate about promoting something that the ngTLDs do best, like domain phrase marketing, ngTLDs make sense.

I personally aesthetically like some of the ngTLDs a lot. To me I find the ngTLD space requires more creativity. But the numbers say making a ROI on them is hard now. Maybe I like a challenge!

Anyway, maybe we should agree to disagree. I will read if you want to post another reply, but I think I will move on to other things as I think I have said all that I wanted to stress. I try to be fair and balanced.

Bob

Bob Hawkes said:

Just quoting myself from the report that started this string in the discussion:

"Registries accounted for almost 64% of sales dollar volume, but less than 19% of the sales by number."

"The registries certainly disproportionately take the first few pieces and often account for 70 or 80% of the largest sales in a month. In this report the registry sales represent almost 2/3 of the sales volume (in dollar terms)."

"The number of ngTLD sales is small when compared to sales in the major legacy extensions, and even smaller when the registry sales are excluded."

"However, even if we take that into account legacy .net/.org are still favoured by a factor of 2 to 3, and .com about double that. If we excluded the registry sales, the picture would be even bleaker for ngTLDs."
​

I kind of think I made sure to point out that the big sales were dominated by registry sales, but maybe I needed to say it 5 times in the report?

I think the long term health of ngTLD universe is helped even by registry sales, as long as they go to businesses that actively use the domains in a high profile way (like the design.online is already doing). I know that the argument can be made that they compete with individual investors, but I rather see it that registry sales can help grow the market as well and make the case for high prices. For that reason I think that the critical question is are ngTLDs getting used, and registry sales should not be ignored. It was in that context that I presented the data. I presumed that people would realize that many would be registry since we have said that many times, including in the report referenced in the thread, that the big value sales are registry dominated. I certainly never said or implied they were NOT registry sales in this thread.

Bob

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Registry reported sales can be tricky, if they are on uncompleted payment plans, or what not. It is upto the registry to create buzz, and hype for their extensions, the best way to do this is to report high number sales.

I am of the notion a sale should not be reported until it is fully paid for, especially for payment plan domains.

There is not enough sales happening to grow supply, and demand value in the space. The thing that makes .com so desirable you can purchase a liquid, or strong keyword domain, and have liquidity fairly quickly if need be. Not so true with 393.club, or 888.guru etc... As has been stated some of these are being bought for development, many for forwarding, others for defensive reasons.

Given there is over 1,000 domain name extensions, seeing a few sprinkled on weekly sales reports does not exactly bode confidence. A smart domainer may be able to seek good keyword combos, and put them up with bin prices, and make a return, but the majority are going to lose, and you see them here on namepros getting bumped endlessly.

Bob Hawkes said:

By the way, I do agree with almost everything you wrote in your last paragraph. i.e.



It's a nice summary of the challenge of ngTLD investing. It is almost impossible to make the numbers work for holding premium renewal rate, even with crazy optimistic price and sales projections. That leaves the names either in extensions that don't charge premium renewals, or finding gems the registry missed (tough but not impossible). I think when you talk a few hundred that is where the main growth of the ngTLD market will be in the next 4 years. Creative types, one person companies, non business users, marketers, etc. will be looking for something a bit better than hand reg. Selling enough at a high enough margin won't be easy. However, at least to the degree NameBio represents the market, the median price for all extensions is typically less than $400 so it is not really different from most sub-prime com sales. In fact my wrap-up highlighted comment said (based on pretty much what you are saying):

It is still prudent to be cautious when investing in (new) extensions, and still true that overall the return on investment seems (clearly) better in .com. The difference is possibly narrowing, however, and if the comparison is with other legacy extensions, or country code extensions, the case for new extensions could be made (although it is still debatable). The health of new extensions, ultimately, depends on the level of adoption of these extensions in significant websites.
​

I argue that for diversification purposes holding a few quality ngTLDs without premium renewals might make sense. Or for those who are passionate about promoting something that the ngTLDs do best, like domain phrase marketing, ngTLDs make sense.

I personally aesthetically like some of the ngTLDs a lot. To me I find the ngTLD space requires more creativity. But the numbers say making a ROI on them is hard now. Maybe I like a challenge!

Anyway, maybe we should agree to disagree. I will read if you want to post another reply, but I think I will move on to other things as I think I have said all that I wanted to stress. I try to be fair and balanced.

Bob

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Don't read to much into these sales now, this happens will all new extensions and there have been many launched over the years, go back and check all the "new" extension threads, there are x,xxx and xx,xxx sales in the beginning. They start off like that but then check those threads again in 3-5 years (namebio, DNJournal etc) and the sales have virtually stopped.

gilescoley said:

and the sales have virtually stopped

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I agree that often there is an early excitement period in a new extension, and .app may be in that or about to begin that. Other extensions (like .space, .online) in this discussion were around for some years though so it is not a startup big sales effect.

In terms of overall ngTLD not a lot of change year to year:
5 yr average 1038 sales per year, $4.0 million sales volume per year
2016 1317 sales $4.7 million
2017 1016 sales $5.2 million
2018YTD (not full year) 1232 sale $4.5 million

I interpret as more or less uniform in the ngTLD space. Of course NameBio reporting introduces possibility of bias.

Bob

Bob Hawkes said:

I agree that often there is an early excitement period in a new extension, and .app may be in that or about to begin that. Other extensions (like .space, .online) in this discussion were around for some years though so it is not a startup big sales effect.

In terms of overall ngTLD not a lot of change year to year:
5 yr average 1038 sales per year, $4.0 million sales volume per year
2016 1317 sales $4.7 million
2017 1016 sales $5.2 million
2018YTD (not full year) 1232 sale $4.5 million

I interpret as more or less uniform in the ngTLD space. Of course NameBio reporting introduces possibility of bias.

Bob

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As I said, none of them are even 5 years old yet, so those figures don't count to me.

.Space and .Online were only launched around 2015/16, so they are only 3 or 4 year old too. (dont quote me on that year, but its around then)

Have a look at .mobi as an example, some sales below, now have a look at recent sales, history keeps repeating itself and it happens with all them. It will continue to do so, some extensions will obviously do better than others.

music.mobi 616,000 USD 2007-12-05 Sedo
flowers.mobi 200,000 USD 2006-11-25 Moniker
poker.mobi 150,000 USD 2007-12-12 Moniker
ringtones.mobi 145,000 USD 2007-12-12 Moniker
casino.mobi 135,000 USD 2009-09-09 Moniker
sportsbook.mobi 129,800 USD 2007-01-17 Private
porn.mobi 110,000 USD 2008-03-25 Moniker
news.mobi 110,000 USD 2007-11-28 Moniker
sports.mobi 101,000 USD 2007-12-05 Sedo
hosting.mobi 101,000 USD 2007-10-03 Sedo

.mobi is not a ngTLD. I think the tech hype and auction rollout of the extension resulted in a hype/situation different from other legacy alternate or ngTLDs. And of course the direction mobile went made the intended need for extension almost irrelevant and prices crashed.

The first year of .xyz does demonstrate the phenomon you describe, however, to some degree. It sells much less now than in year one.

PS .space general availability 28 Jan 2015 and .online 26 Aug 2015.

Bob Hawkes said:

.mobi is not a ngTLD. I think the tech hype and auction rollout of the extension resulted in a hype/situation different from other legacy alternate or ngTLDs. And of course the direction mobile went made the intended need for extension almost irrelevant and prices crashed.

The first year of .xyz does demonstrate the phenomon you describe, however, to some degree. It sells much less now than in year one.

PS .space general availability 28 Jan 2015 and .online 26 Aug 2015.

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ok, thats fine, but its new extension that had exactly the same domainer hype as these new extensions do

ok so I got the year right for space/online, lets see how they perform in 2020 onwards

To me personally it feels like the interest has dropped over the past couple of months. I've received less offers through Sedo than normal and those that have been received are not worth even negotiating, although I do always respond.

The ones I have I will filter at renewal and keep a few dozen of the ones I really like. I still believe the good ones will be worth a decent amount - short single word gtlds with the corresponding .com having previously sold at high value in the past.

Bob Hawkes said:

I don't expect most big companies to ever go away from .com as their major company website (I could be wrong, of course!). What I think we may see is them use other extensions for marketing purposes as Apple did with experience.

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Why not ?
I think that corpTLD applicants 'should' use their extensions heavily, after all they applied for them, and paid dearly. Otherwise what's the point.

If they keep using them for ancillary projects, they will forever send the signal that these names are not good enough to host their main sites and thus inferior to .com.
Consumers are not stupid, they notice that. So they are not impressed by new extensions, because they see the reluctance even from their biggest proponents.
To me that is the most surprising aspect of the nTLD program. Failure from their own applicants to embrace them.

And just because a large company uses a nTLD does not mean every consumer suddenly wants one.

Redirecting nTLDs to .com domains depreciates them too: nTLD = redirect = gadget.

Some 5 years ago pundits announced a seismic shift in the domain space. It hasn't happened.
.com is still doing strong
nTLDs aren't gaining much traction nor going mainstream like some predicted
Many corpTLD applicants are giving up: https://www.namepros.com/threads/list-of-retired-new-extensions.991424/

I am not against the principle of new extensions. But the program has been poorly carried out. It was just a money grab. Lots of non-viable extensions were released.
That created uncertainty and even desperation. Some registries have hiked prices dramatically, they are trying to make money out of unprofitable extensions because the demand isn't there, and the volume isn't there.
Who wants to build an online presence on an extension that is on shaky ground. And could disappear in a few years.