NameSilo

How well are the new extensions doing?

Labeled as opinion in Domain Extensions, started by jamesosix, Oct 30, 2018

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  1. jamesosix

    jamesosix Top Contributor VIP

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    Hi,

    Just searching for a domain and see name.word is available. What is the general consensus to date on the new domain extensions (.shop, .online, .garden etc etc). Are they selling? Are they not worth the time? I am very interested to see what the professionals think.

    Thanks
     
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  2. gilescoley

    gilescoley Top Member PRO VIP ★★★★★★★★★★

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    Besides a few sales here and there (.club, .global etc ), most are a waste of time.

    Focus on strong extensions
     
  3. Brands.International

    Brands.International Marek VIP

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    There is absolutely no consensus to date. Those who invested in new extensions and did not make too many initial mistakes (usually) like them, those who hold other investments or missed the boat or invested incorrectly in them might not like them or might even hate them in some instances. And lot of variations of opinions in between.

    Also, new extensions means set of several hundreds of different extensions, registries, policies, etc, all with different performance as investment so far..so it would be very gross and innaccurate generalisation to speak about 'new extensions' without really distinguishing between them on various levels (pricing, availability, renewals, user adoption, registry premium names, may other factors).

    Read the forum extensively and form your own opinion, we have hundreds of threads here about that. Without extensive reading, no one will or can trully help you with this question in one single post, imo :)
     
  4. Kate

    Kate Domainosaurus Rex VIP ★★★★★★★★★★

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    Reviewing the reported sales would be a good start. They will tell you all you need to know :)
     
  5. JB Lions

    JB Lions Top Contributor VIP ★★★★★★★★★★

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  6. bmugford

    bmugford www.DataCube.com PRO VIP ICA Member ★★★★★★★★★★

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    Overall, not good. There is less interest now in most extensions than there was at launch.

    In the last year NameBio shows a total of $6M in new extension sales. Pretty marginal numbers, especially considering the vast majority of revenue is also for registry owned domains. Also, a handful of outlier sales at the top make up a large % of the total dollar amount.

    Brad
     
    Last edited: Oct 30, 2018
  7. Internet.Domains

    Internet.Domains Account Closed (Requested) VIP

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    On Wall Street they would call it a "bear market" in regards to the New G's.
     
  8. bmugford

    bmugford www.DataCube.com PRO VIP ICA Member ★★★★★★★★★★

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    Just take a look at the forum on gTLD(dot)link founded by 2 of the biggest new gTLD proponents in Chad Wright and Phil Harris. It used to be popular but has pretty much become a ghost town.

    There is just not the same level of interest in new extensions that there was around launch.

    Brad
     
    Last edited: Oct 30, 2018
  9. garptrader

    garptrader Top Contributor VIP ★★★★★★★★★★

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    Most of the newer extensions were released in 2014 or 2015 so in late 2018 they have been around at least a few years. How old can the following be and still be considered new? (My guess)

    -pair of running shoes (a month)
    -laptop computer (a few months)
    -sports car (3-6 months)
    -condo/house (one year)

    So when do we stop calling the extensions released from 2014+ "new'?
     
  10. Brands.International

    Brands.International Marek VIP

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    That is a good question :) But what their alternative name should be? Atm most people call them "new extensions", "new domain names" or "new gTLDs" or "dot brands"...

    I like "new gTLDs" the best, but when you speak to normal people outside domaining, it is best to use something like "new domain extensions" imo...
     
  11. Bob Hawkes

    Bob Hawkes Top Member NameTalent VIP Gold Account Trusted Blogger

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    I too must admit that new seems a name that increasingly is inappropriate as years go by. But the name and ngTLD acronym pretty ingrained. What about novel generic TLDs? Keeps same acronym, slightly nuanced novel vs new?
    Bob

    PS Of course the sceptics would say call them Nobodys gTLDs :xf.grin:
     
  12. Bob Hawkes

    Bob Hawkes Top Member NameTalent VIP Gold Account Trusted Blogger

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    As @JB Lions kindly pointed out I do a monthly analysis of what sells, top sales, venues, types of names, mean and median price, etc. If you scroll through the article at link below to near bottom I put in link to all 8 monthly reports I have done.

    https://nametalent.com/2018/10/recent-new-extensions-domain-sales-actionable-insights/

    On average about 120 sales per month but less the most recent month.
    As a percentage of registrations sales rate roughly 1/10 of .com, although average price higher so ROI less by smaller factor but still clearly less. They are closer in net/org but still less ROI and lower sales ratio.

    I continue to see a role for ngTLDs but adoption is slow, despite a numbet of major sales. Here is picture YTD up to few days ago. The year looks like will end not very different from 2017.
    • In 2018 YTD there have been 1196 ngTLD sales listed on NameBio, with an average price of $3675. Sales volume is just over $4.4 million in the year to date.
    Bob
     
  13. Rob Monster

    Rob Monster CEO, Epik Epik.com Staff PRO VIP

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    After the Uniregistry 30X price increase event, it is clear that new TLDs have massive counter-party risk implied in their unregulated ability to increase prices effectively making it possible for a power move to regain control of an entire TLD. I thought it was an edge case until it actually happened.

    By way of parallel, cryptocurrencies with limited adoption have a "Byzantine Generals Problem" where a Blockchain can be effectively hijacked by superiority of stake or computational power. It is a design flaw that Blockchain designers are always working to solve. There are few easy solutions but in time I suspect it gets solved as the pros outweigh the cons in terms of the utility of the concept.

    The parallel is relevant. Why? Because the lack of governance by emerging cryptos has made BTC supreme with 54% of the market cap covered just by BTC even though BTC is a terrible choice for most transactions and its main utility is as store of value. We have the same with domains where .COM dominates. It dominates because most new TLDs are poorly marketed and some are poorly governed.

    In short, the new TLDs have a confidence problem. Many of them are treading water. Donuts has scale and capital so it can milk brand protection but usage in the wild is still low. How to solve it? New TLD registraions should pivot from being an option into being an asset. Right now if you buy a domain, you are effectively buying a call option on the future value of the domain. However if registries simply let speculators own the domain, time would no longer working against them. You could buy and hold. We need that now.

    More here:

    https://epik.com/blog/forever-domain-registrations.html

    The registries can be contacted. Most of them are run by rational people who will dread the idea of seeing their registration count peak. That is precisely why I foresee a new pricing model and it will logically start with new TLDs as they have the most to gain, and also the most to lose if adoption stalls out.
     
  14. jamesosix

    jamesosix Top Contributor VIP

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    lots of good feedback here. Thanks guys.

    Would you say if the gtld matches well then it may be a worthwhile risk? for example domains like "websites.online" or "flower.garden" etc?
     
  15. Brands.International

    Brands.International Marek VIP

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    Now the question is: is it good to buy or sell on a "bear market" ? Many guys, they do not manage their renewals correctly, and so they NEED to sell within a year or two. While maybe it still is a best time to buy instead.

    I always cringe when I see someone trying to flip some not even good new gTLD domain within a year timeframe, particularly when extension of that domain name is not even a 1 year old...so there is no aftermarket formed yet...it might easily take 5-10 years for that aftermarket to be formed. The name of the game is to get best possible inventory and make it self-sustainable.

    At the end, all investments are about corect timing of buy/sell. But as I said, there is no consensus whatsoever and everyone approaches this differently.
     
  16. Brands.International

    Brands.International Marek VIP

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    It might be, but it might be tricky to pick up a corect names, as there are much more variables in this...
    I am running small new gTLD appraisal thread, you can read it here, it can give some ideas maybe :)
     
  17. Bob Hawkes

    Bob Hawkes Top Member NameTalent VIP Gold Account Trusted Blogger

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    Just wanted to say that @lolwarrior is way too humble! He is running a popular and incredibly valuable thread to evaluate ngTLDs. I strongly urge any ngTLDs to visit it. You can learn a lot just by reading through the evaluations, and of course submit as well. I really like his structured approach including all of popularity of term, aesthetics, match with extension, likely selling price, likely time frame and renewal cost.

    Thanks so much for the link and perceptive comments @robepik!
    Like many things in domain investing, I have trouble personally clearly seeing where we will be in 5 yrs, both in ngTLDs but also in the general use country codes and indeed even to some degree the legacy extensions and domains in general. One mistake we sometimes make is to lump the ngTLDs together, but really the characteristics and administration vary rather extensively.

    The messages are somewhat mixed in that some of the extensions doing well (at least compared to other ngTLDs) resale wise are somewhat different from those with more promising real world adoption. Ultimately I think those that get used in real websites will become more valuable, but it may be a slow process.

    Lots to think about!

    Bob
     
  18. wwwweb

    wwwweb Top Contributor VIP ★★★★★★★★★★

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    The issue with GTLD’s is the governance within those contracts, that they can increase the price by whatever they want, effectively being able to extract back a domain over time from a registrant by making it unrealistic for them to pay for their renewals.

    I have seen renewals as high as $60,000 per year from some registries, every keyword has an attached renewal value. Whereas .com, and most other extensions all work with the same base renewal, and the market sets the price based on the character make up of the domain. This is a more natural, and organic system of
    doing things with less likelihood of manipulation.

    LOL Warrior lives up to his name, by presenting a lot of talking points, but not much in the way of sales data from his actual portfolio.

    The GTLD market is further flawed with many registries taking back drops, and attaching higher premiums for a direct market channel.

    As well marketing for new gtlds has gone cold, the registries are not enabling their budgets to burn cash marketing these extensions anymore.

    The allure of a new gtld is great for newbies alike, as they think they are on the forefront of something great, nobody knows about, but we are going into the 5th year of these launches and many of the pioneers have already bled thru their portfolios as they were not able to keep up with premium renewals.
     
  19. Bob Hawkes

    Bob Hawkes Top Member NameTalent VIP Gold Account Trusted Blogger

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    The evidence clearly suggests that a single word and a matching extension is what most often sells, and in that sense the examples you show are indeed strong.

    To answer whether they are worthwhile investments, you need to look at probability it will sell, likely net profit from that sale, and the annual costs. While the variables are harder to predict than for .com or even for .net or .org, we do now have more than 5000 ngTLD sales representing more than $20 million in the NameBio database so there is some evidence (see list here). What I would do is to try to find somewhat comparable sales and see if your name is better or worse than these, and try to predict sale prices accordingly. Probability is still challenging to predict.

    I think with ngTLDs if you want retail sales you need to be more proactive in promoting the idea of a ngTLD to potential users. Some of the registries are doing this as well, some more effectively than others. You may find this post on why an organization might want a ngTLD helpful in developing your arguments. It also can help you in choosing names to invest in.

    Even with .com the typical holding time, if you hold until it sells, is 70 yr (as a famous name in domain investing says, this is a multi-generational enterprise!) and significantly longer in ngTLDs. Your options are either to shorten that by wholesale selling of domain names, or accept it and make sure that renewal costs and likely payoff are enough to win overall in your portfolio.

    A long and inconclusive answer..Sorry.

    Bob
     
    Last edited: Oct 31, 2018
  20. JB Lions

    JB Lions Top Contributor VIP ★★★★★★★★★★

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    You could look at previous new gtlds, .co and .me. The new gltds before these new gtlds. I invested in a lot of .me, and they went exactly how I expected. In the beginning there is hype and hope, big sales. It kind of levels out, then sinks. I expected these new gtlds to be more of a competitor to these extensions and kind of follow the same path.

    I'm not sure what is supposed to happen 5-10 years from now that will make these all of a sudden attractive to somebody. Knowing most are niche and you really don't have much leverage unless you're holding dead-on type of names, the type the registries seem to keep.
     
  21. Rick Ace

    Rick Ace Top Contributor VIP

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    Quite a few things can happen in 5-10 years.

    1. The gTLD Hunger Games: Registries going bust, renewal prices, and low confidence from domainers and consumers alike could trigger a chain of events that leave the gTLD field desolate. Any surviver of the gTLD hunger games with users and decent popularity will likely be the torchbearer for new gTLDs.

    2. International adoption. The internet is also being localized in many cases. I wouldn't be surprised if a new TLD dominant TLD emerges in strong regional markets like China, Russia, or the Middle East.

    Of course, this is speculation, and not many are willing to put their wallet on the line for this.
     
  22. Internet.Domains

    Internet.Domains Account Closed (Requested) VIP

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    Yes, a "bear market" is still a market. There are sales happening, just not as much as a "bull market" would produce. That may or may not change, only time will tell. As a disclaimer I am invested in both .com and New G's.
     
  23. Brands.International

    Brands.International Marek VIP

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    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 :)
     
    Last edited: Oct 31, 2018
  24. Internet.Domains

    Internet.Domains Account Closed (Requested) VIP

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    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.
     
  25. Brands.International

    Brands.International Marek VIP

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    That is very true :)
     

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