2008/07/31

Domain Name News

Posted: 30 Jul 2008 03:07 PM CDT

Ten Emerging Beliefs and the Opportunity They Present

Domain conferences share a commonality during which, over time (turbulent times no less), certain conventional wisdoms begin to emerge as the industry matures and infrastructure solidifies. In other words, the more the industry coalesces and becomes viable and full, the more common beliefs come into play and perception becomes a central figure.

Trips to shows this year and all the conversations that went on behind the scenes produced many threads or commonly held and generally agreed upon principles that can help provide guiding light in an uncertain future.

Now, eighteen months ago, this would have been a different article, with different results and beliefs – ultimately, this is a testament to the cycle that is the domain business. Yes, domains too are subject to cycles and those around long enough have weathered a few with their dot com raincoats.

To wit, the current cycle (low with seasonal and economic effects piling on) has cleared up a bit, allowing us to make the following ten potential 'statements of state'.

With recent Yahoo changes, arbitrage is on its last legs and may have hurt domainers on a large scale - arbitrage is always a declining strategy (not even an asset) as word spreads.
Premium domains (premium and brandable generics) are here to stay.
Sub-prime, replaceable domains continue to lose value. Large chunks of registered names have dwindled to 'caveat empty' at base prices.
ccTLDs are the next best choice after .com.
A true shift from traditional TV advertising has begun, led by the Fortune 1000.
.TV has its place yet development is likely a necessary adjunct to the formula.
True development (requiring innovation on some level) is expensive and difficult – the industry having yet to produce a 'home run' on the development side (outside industry providers).
Traffic, traffic, traffic as always BUT there is a change going on – with a focus on 'eyeballs' as opposed to 'clicks' from the Fortune 1000. This is the effect of #5 above as they apply the same principles to the Internet as they did the tube.
The middleman's influence in the marketplace is shrinking and naturally so - and largely by their own failings. At some point, competitive saturation and strategy combined with fraud, budgetary needs and simple intelligence will push more advertisers directly to the owners. Sendori may be the key figure here.
European domainers are far more skilled in monetization than their American colleagues. Without PPC, they have turned to development and sponsors and networks – they can teach us much in a shaky PPC environment.

It must be pointed out that while some of the above can be considered 'good news', I must continue to stress the need to de-generalize our domain discussions. The above points to specific classes and not 'domains' as an entirety.

In short, those with premium and brandable generics, geo-domains, prime ccTLDs and .TV have brighter days ahead on the monetization and resale side. Others holding long names, alternate extensions, TMs, typos or generally subpar domains should be looking over their shoulder.

Point being that the above can be a valid road map to the current state if you are not caught up in the generalization and can plot a unique course. These simple statements open mountains of opportunity – that is, if you can read between the lines and extrapolate it forward in time.

M. Fiol is a regular DNN contributor and DomainConsultant.com analyst. He also runs and is CEO of HappyBirthday.com.

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