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Frank Schilling explains price hike – DNW Podcast #127

Schilling explains why he decided to increase prices on some of Uniregistry’s TLDs.

dnw-podcastFrank Schilling’s Uniregistry created an uproar last week when news leaked that the company was preparing to drastically increase the cost of some of its domains as much as 30x. What does this mean about the health of new TLDs? What does it mean for domainers, registrars, and other registries? Frank Schilling sits in the hot seat this week to discuss.

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  1. John McCormac says

    It appears that Frank is thinking like a registry operator. Obviously domainer expectations were not met by the demand but domaining is only a part of the ecology of healthy TLD. ICANN bears a lot of the blame for crashing demand and creating market confusion by compressing the launch schedule. The danger with a TLD business model based on discounting, as with .XYZ, is that it locks the registry into a boom and bust cycle.

    The real collapse in initial demand happened in 2010 when ICANN hit Domain Tasting. Prior to that, there was an artifical scarcity.The new gTLD programme proceeded as if nothing had happened but the market conditions had changed drastically.

  2. Ron says

    I am sure many guitar shops face lots of hurdles with online channels like amazon, and cheap guitars shipped from overseas.

    Small businesses are always getting squeezed, most guitar shops, I see are usually small holes in the seedy part of town.

    All Frank is going to do is cripple this extension, there are just to many choices, and as stated .guitars is just a novelty right now.

    It is unfortunate, but he picked a loser, and everyone that got swept into it has to pay for it. If he can’t afford it, maybe surrender it to an operator who can run it better, or market it better.

    There is so much available in Guitars keywords if you are creative in .com, and most artist are creative enough to figure this out.

    This just faces more bands to solely rely on social media sites.

  3. DavidJCastello says

    Frank shouldn’t have to explain anything, but the reason he did so is because many of the owners of these gTLDs are domainers and they know who he is. Obviously, it hurts to get bashed by your peers, but therein lies the paradox. Domain owners couldn’t care less why he raised his prices. All they know is that he did so and no reason will satisfy their anger. Conversely, the public (endusers) would have an interest in why he raised his prices, but it’s not the public complaining the loudest because there simply isn’t that many of them.

    • Ron says

      What fairytale do you live in that you don’t need to explain anything to your customers when you raise prices in a single year by 5-10x, you need not explain yourself?

      David, which domain owner have you spoken to in this extension who doesn’t care about the price hike?

      • DavidJCastello says

        You misunderstood the reason for my comment. I have never been a fan of the new gTLDs and it’s not because of our dotCom portfolio. If I thought these gTLDs had legs, my brother and I would’ve been all over them, but the truth is that there has NEVER been any public demand for these names. The only people who wanted them were ICANN, some domainers and industry people looking to make a buck. The one thing I learned in my 20 years in this business is that the public decides. Always. They decide how much money we make. Every six and seven figure domain sale we’ve had has been to endusers. Never a domainer. And, yes, every domainer I know who invested in these names is absolutely furious. My comment is that NO reason Frank gives will excuse these price hikes. Do you seriously think that any domainer who listens to Frank’s podcast will suddenly say, “Ah, OK. Now I get it. Makes sense to me. Everything’s cool. I’ll pay it.”
        Therefore, I believe that Frank shouldn’t explain anything to the domainers who invested in these names because it doesn’t change anything. He’s going to raise his prices, regardless.

  4. John says

    What is there to explain and what mystery could there possibly even be about it?

    I won’t be listening to this one, otherwise I love Andrew’s excellent podcasts and highly recommend them. If there is any possible explanation in this podcast that anyone either doesn’t already know or cannot surmise based on common sense, then kindly post the Cliff Notes version here, lol.

    • Ron says

      He basically summed it up, he doesn’t care what he has said or done, or doesn’t care about the registrants, he cares about his bottom line, and the people who get the gift of registering a .whatever Frank is selling, should be thankful for this groundbreaking opportunity they have to get in early.

  5. Nic Danger says

    Does anybody believe anything Frank Shilling says anymore???, besides those bloggers like like Morgan Linton and Domain Shane who kiss his ass.

    • Ron says

      He sort of forgot he is still a domainer himself, you just can’t take the domainer hat on, and off, either you are, or you aren’t.

      At namejet buying everyday, he definately is, and they spend big dollars.

      It seems he got it wrong, .com is still the FM dial, and GTLD’s are the AM dial, and will soon turn to static, as even the biggest cheerleaders have gone radio silent at the mercy of the registries they entrusted, and funded.

      The reality is true, it’s no different then when dictators revert to ethnic cleansing, he is essentially trying to cleanse his registries after he got people to pay, and sustain them for so many years. This is very dangerous because there will be many real end users who will not want to, or afford to pay $300 a year to renew a domain, sometimes it comes down to principal

    • Shane Cultra says

      Nic,

      You don’t read much. I have been as critical of Frank as anyone. Don’t make up shit so it fits your agenda.

      Kudos to Andrew for getting Frank to do the interview. Because Frank should have known that nothing he could have said was going to change the opinions of those that have made it. It’s just one more comment section open to blast him.

      Let me just some everything up.
      1. Nobody is registering his string.
      2. Forcing him to raise price to try and generate revenue
      3. Realizes that is not going to work either and sells or abandons string

        • shanecultra says

          Dan,
          Turns out it wasn’t that great of a buy. But I think I’m going to lose a lot less than Frank on his new Gs. But hoping you put a lot into both

      • Michael Anthony Castello says

        Shane, my guess is that those “stinker” strings will show a profit after the auto renews and price increases. Thereby showing a positive cash flow on his overall string portfolio, which will look good to potential buyers. He will have a year to sell that part of his business if he chooses to do so.

        • 168 says

          Michael, nailed it. It’s disturbing to see 98% of respondents don’t get it.
          Although Frank hasn’t been particularly savvy in his approach I do believe most New “G”s will end up in the 1-300 yr range.
          People tend to forget or never new the legacies were once in the 100 range and only reduced as volume went up.
          I think we can all agree:
          1. Most New “G”s will never see high volume regs.
          2. This market wasn’t created for investors
          3. End users is what everybody wants and 1-300 yr
          price range is a reasonable expense for an end
          user.
          Investors, domainers have no problem jacking up the price of a 10 dollar investment. They shouldn’t have a problem if the cost to them is also jacked
          It should be no surprise to any one market pricing fluctuations is a part of the process in rolling out a new product line. Pricing rarely goes beyond what the market decides, not domainers, is reasonable.

      • brand says

        I agree Shane..

        Kudos to Andrew for getting Frank to do the interview. Because Frank should have known that nothing he could have said was going to change the opinions of those that have made it. It’s just one more comment section open to blast him.

        These new extensions were a gamble for the registries and domain investors from the start.

        Now we are starting to see some of the effects of this uncharted territory.

        [ just my opinion ]

  6. Jim says

    I was talking with a rep from one of the old school registries at Namescon. And I told them that I thought the biggest winner of the new TLD’s would be old school registry operators. They agreed 100% with me and we laughed about it.

    The reason is pretty simple, so many of these new TLD’s have contracts with different registry operators. At some point the new TLD’s will stop being profitable and at some point they will cut their loss. And guess who will be there to take them over? The old school registry operators. It will be just like buying a used car.

    • Snoopy says

      This looks tore playing out, just look at Centralnic’s recent large profit increase vs rightside and MMX’s recent massive losses. The one’s who aren’t carrying all the downside of Icann fees (but are just managing string for others) seem to be doing best.

  7. freddy says

    Next registrars will be paid off via promotional credits by the .com, .net and other registries in an effort to stop registrars from selling new gtld’s Let’s face it, Anything bad, no matter how small for new names is good for .com. This fight is really about com against new endings in the eyes of the old school registries.

  8. Garth says

    Speculation to the left and right of the dot, nothing is guaranteed.
    Admire guys, like Frank, that do swing at the plate. Registries, at the founding core, have been not-for-profit. So this commercialization of spaces now is an interesting dynamic.

  9. Jane Doe says

    All I need to do is compare Donuts to Uniregistry in how price adjustment was implemented.

    One looked after existing customers, the other is screwing them…

    …so now I have to consider the possibility that this will extend beyond their extensions to Uniregistry.com and what that may mean for my portfolio there.

    Always good to be reminded to review

    • Ron says

      Portfolios at uniregistry are as trump will call them wire tapped, they can see all your stats, inquiries, they can follow up with your old inqiuires, they can see your sales even if you don’t report them in a public manner.

      So in doing so they can upsell their names to your clients, as well plug in all your data, and bid you up at namejet.

      Nothing is free, let me tell you that, so ask questions, and get something in return, nobody is doing anybody any favors.

    • Nick says

      Donuts doesn’t care if it’s extensions lose money cause the owners don’t plan to own it very long. Raising prices will be the new owner’s problem.

  10. Steve says

    @DavidJCastello

    David, I believe you nailed it with your comments.

    Like you and your brother, I too would have jumped into the GTLD arena if I thought there was serious demand for these extensions.

    I own some super .com domains, and super premiums in .me. I get lots of low offers, and I make maybe 10-12 decent sales, and all to end-users over the course of a year. Selling domains for the right prices is not easy. Ask the domain brokers who bust their tales, trying to satisfy their clients and end-users/buyers.

    I’m pretty sure Frank and the myriad owners (registries) of the GTLD extensions anticipated greater interest from end-users, maybe even hoping one of the extensions could result in an exit like.co.

    Bottom line: I commend Frank for giving his POV on the podcast — he didn’t have to do this. He simply has to raise the prices to keep the extension(s) alive. Again, this was a business decision. Nothing personal.

    • DavidJCastello says

      10-12 decent super premium sales a year is excellent. I wish there were more domainers out there doing as well as you. The bottom line is that if you invest outside of the legacy TLDs and the ccTLDs you might as well try your luck in Vegas. The odds will be better.

  11. WQ says

    I think most are missing the point from the side of those who have invested in New GTLDs. Not only his extensions but in others as well. This may well affect many down the road.

    Frank has said several times these have bright futures. Sure, experienced folks may see this as sales BS. Not everyone may be as smart especially coming from a domain guru.

    From his .audio application, for example, Frank said “Uniregistry intends to make a contractual commitment to registrants and their registrars not to increase registry prices above cost of inflation for the first five years after launch of the registry.”

    It hasn’t been 5 years and it’s going up up up.

    Frank has marketed these to investors with cheapie registration rates. Lured them in.

    When his North Sound company dropped 200K+ names the list was sent out to investors like myself.

    Sure, registration counts may have not been where he thought they would be or where they needed to be but if you got in on any of these under the above assumptions you’d probably be upset as well.

    This can be diverted by grandfathering in previous registrations, for the most part.

    Doesn’t look like that is the case. Having renewal promos, as I believe he mentioned, that one has to hunt down and/or use during a certain time window won’t cut it either.

  12. Ron says

    FYI .broker just decreased their price from $600 per year to $30, the opposite of what uniregistry just did.

    • Snoopy says

      If they aren’t grandfathering at the old price then I’d say they they just gave away 95%+ of their revenue. Registration numbers up 50%, an awful long way from the 2,000% increase they need to break even on that move.

      • Ron says

        I would check the numbers with the latest update, I am guessing they are up more than 50%, .broker is weak, but I am sure pro GTLD buyers can make some good keyword combos from them.

  13. Martin says

    It appears the damage hits the whole Uniregistry brand, not just the junk names part. I imagine some clients now will change providers for parking, sales.

  14. Paul Hart says

    Frank misses the point that business consultants, like myself, ARE ALSO domainers. I can’t put a client into a situation where the price of his domain might zoom up in cost. Clients depend on many domainers to find or suggest a good name, help build a website, and offer other advice. Why should I buy anything from a guy who says he has no boundaries in raising prices in the future? I’ll go with the .com and social media.

  15. Mark Thorpe says

    Frank bought a bunch of .coms last year and they are not worth anything. Please, .com is what made him rich and he is still buying and selling .com’s to this day. How about all those .com CHIP domains he sold to China in 2015 and made millions!

    He is just bitter because guys like Rick Schwartz was right and he was wrong.
    He actually helped .com become even more valuable with his failed nTLD’s.
    .Com won, he lost. Game over.

    Now ICANN needs to implement new rules and regulations for any new gTLD extensions that are offered in the future. If any are offered again, after this nTLD debacle.

    If ICANN was smart, there would not be any more new gTLD’s offered for at least 5-10 years or none at all.

  16. disappointednotsurprised says

    Another black mark for the industry. Frank’s use of the word ‘tout’ is interesting.

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