Domain name industry consolidation is necessary, but competition is crucial.
As I walked around NamesCon yesterday, I saw the signs of consolidation in the domain name industry. There’s Hexonet, now part of CentralNic, which has gobbled up many domain companies. Enom is now part of Tucows. There’s GoDaddy, which acquired Host Europe Group. Heck, GoDaddy is now the parent organization of NamesCon.
For the most part, this consolidation is positive. There’s still plenty of competition for domain name registrars. Technical registry tie-ups make sense as margins tighten. Top level domain operators need to combine costs to make the numbers work.
Yet consolidation can be overdone. There are some areas of the domain name business with scant competition.
The key one I see is domain marketplaces. There are just two marketplaces: GoDaddy and Sedo.
True, other companies compete with these two for part of the domain sales business. For example, landing page services and parking companies siphon off some of the leads that come in from parked pages. But we only have two domain sales marketplaces that get domains in front of buyers through the registrar channel. And only two sites that attract buyers searching for domains to buy.
Competition is good. It keeps companies honest and fair. For an example of a lack of competition hurting the domain industry, look back to the duopoly of Yahoo and Google for domain parking. There were lots of domain parking companies, but they all depended on two providers. Once one of those providers faltered, the other turned the screws on domain parking.
As for GoDaddy and Sedo in the aftermarket, GoDaddy is the clear #1. It’s good to have a solid #2 pushing it to innovate and keep its prices in check, though. Domain investors should keep this in mind and make sure to support both marketplaces.
Jason E. Franklin says
I noticed GoDaddy now running NamesCon. I think this is pretty awesome if that is the case, as I’m an avid GoDaddy fan. When was the conference acquired from WorldHostingDays or was it? I was just looking on Crunchbase and the last acquisition it shows was when NamesCon was acquired by WorldHostingDays.
Andrew Allemann says
It was part of the Host Europe Group acquisition. But the original conference team runs it separately.
Jason E. Franklin says
I wasn’t aware of that. Thanks for sharing Andrew.
Mark Thorpe says
I don’t have a problem with consolidation within the domain industry, i just don’t like private equity firms buying domain industry businesses, raising prices and then milking them dry.
I agree, domainers should support multiple domain marketplaces (and registrars).
John says
Andrew, how dare you speak against free monopoly capitalism!
“The key one I see is domain marketplaces.”
What I hate the most is the lack of good user-friendly auction platforms. NameJet is useless because they require the Estibot abomination to appear with listings, a 100% deal breaker. That leaves really only Sedo. And no, I will not be paying $59 or whatever it is just to initiate an auction. That should be free on the front end. The real action you want is competitive bidding, not just a platform for BIN or “make offer.”
snoopy1267 says
Forget about auctions unless you want to sell at wholesale level. It is a way of clearing out names not a business model.
John says
Why do I not agree with that at all? And what’s with the “1267”?
Samer says
https://sedo.com/us/sedo/farewell-minimum-fee/
You dont think, this is foreshadowing?
predict, sooner than later, they’ll get rid of it for good.
John says
Took many years for that “sooner or later” to occur. Most of us will be dead at that rate.
Samer says
Can someone buy eNom Central? Who charges $49.95 for .com
joesaba2014 says
It is not good at least for me, Godaddy and Sedo for a simple reason both are in the EU and when you decide to sell domains with them these two companies only sell in Euros when living in the EU and for myself I must pay more taxes in Euros than in US dollars.
We have two other Efty.com and Da.com in the EU and for me they are better and Afternic is the same Godaddy.
I use Efty, Domain Agents and the Uniregistry broker team and when they give me joy, I also give them premium domains for sale and the best premium domains with the well-known Brokers Domain.
In parking domains it is not as before the best currently are the
Landing page is the best option and important conversions and sales of advertiser products, which makes domains get more value.