Analyzing .co two years in and what it tells new TLD applicants
Friday, July 20th, 2012
Your TLD is unlikely to be as successful as .co.
The rebranded .co domain name is now two years old.
From a business perspective .co has been a huge success. It has a whopping 1.3 million domains registered after two years. It has generated tens of millions in revenue.
But I caution new top level domain applicants that are basing their projections on recent new TLD launches like .co.
First, the good news: many of those .co registrations were made at premium prices (e.g. $30).
Now, the bad news:
* .Co has spent millions marketing .co. Tens of millions? We’re talking co-branded Super Bowl commercials, dozens of conferences, professional advertising firms, etc. This isn’t cheap. You think showing up on Go Daddy’s home page doesn’t cost anything?
* .Co had little to no competition. I’m talking about competition from other new TLDs. When you launch one of your “new TLDs” in a years’ time, you’re going to have a lot of competition. Sedo has helped sell over $1.5 million worth of .co domains since 2010. Much of that comes from domainers, no doubt. These same domainers are going to be spread really thin when they have hundreds of top level domains to choose from. (The $1.5 million sold at Sedo is dwarfed by hand registrations made by domainers.)
* .Co is similar to .com. There, I said it. This was .co’s biggest blessing when it launched (people wanted to make sure they covered themselves since it was similar), but is probably its biggest curse now. The similarity makes it more difficult to differentiate the brand.
If new TLD applicants have 1.3 million domains on their forecast for two years in, even if they sell them for a lot less money, I think they’re going to be in a for a rude awakening. A handful will reach this number. But most won’t even hit 50,000*, the amount at which they have to start paying additional fees to ICANN.
(Note: the 50k threshold applies to each transaction, with a transaction including a renewal.)