If you see any of these warning signs, run for the hills.
A number of domain investors, myself included, have invested money in newer top level domain names. Many times these investments haven’t panned out. So here are five warning signs that the top level domain you’re investing in is a money loser.
1. Domain registrants spend more time on forums writing about how the domain is the next great thing than they spend managing their own portfolio.
2. The registry starts giving away domains for practically nothing..
3. Domainers suddenly pay ridiculous aftermarket prices for the domains at auctions, while potential end user buyers sit around scratching their heads in wonder.
4. GoDaddy refuses to be a registrar for the top level domain.
5. The domain was introduced this century.
Any other warning signs you can think of?
David J Castello says
#1 red flag: Low percentage of developed names.
Andrew Allemann says
Here’s another: high number of bogus sunrise requests, e.g. trademarks for “mortgage”
John McCormac says
As David said above, the low utilisation of the domains whether for websites or e-mail is the the #1 long term indicator.
Another indicator is the second anniversary of the landrush Junk Dump phase. The numbers dropped during the second anniversary should be just a soft echo of the numbers dropped in the first landrush anniversary Junk Dump. But if the numbers are anything close to the numbers in the first Junk Dump, then it is a sign that the die-hard supporters are dropping their domains.
The collapse of new registrations after the initial landrush is also a good indication of how an extension will develop.
There is a more subtle indicator of the success of a new TLD and it is to be found in the application documents of the registry for a new TLD. That’s the famous business school market projection. It basically says that the number of domains in .com is X and therefore the new TLD should get n percent of that market. (It is right there in the .pro application.)
Perhaps the unquantifiable element is the clue factor in the registry. If the clue factor is low then the new TLD will not be marketed or administrated properly. The effects of the lack of a clue are all too clear though as they result in low registration figures, low utilisation and minimal market share.
John Bomhardt says
When right after the launch of the new TLD you see all the prime keywords parked, that means it has no chance of natural growth or adoption by the general public since we all domainers are squatt… ahem, uh “developing” on it lol
John
Unplain dot com
Jim Bob says
When the registry owners own more than 50% of the domains.
EM @ KING.NET says
Can you consider .TV in the losing battle? This is the opposite of no.2, Enom keep all (most) the premiums .TV with really high yearly fees.
EM @ KING.NET
Steve M says
6. When the registry threatens to take back any domains which are not promptly developed. (In .mobi’s case, “promptly” apparently now meaning never.)
7. When two or more entities are fighting over the TLD’s ownership.
8. Any TLD which has the support of at least one well-known politician.
9. Any new TLD period.
Alan says
David is absolutely right and John Bomhardt has made an excellent point.
When domain investors buy all the best names in the goldrush there is little left over for pure growth from names that would attract attention from the masses.
My money is on we will never see another extension add any value to this internet ever. All those $10,000 .me names bid by investors was money washed down the drain along with all other extensions.
If you buy something to build then price is relative to your business plan. If you buing an investment then any new extension is just a gamble.
I would rather play roulette any day.
Andrew Allemann says
“When domain investors buy all the best names in the goldrush there is little left over for pure growth from names that would attract attention from the masses.”
That seems to describe .eu rather well
Stephen Douglas says
I’ve never ever ever landed on a website with the extension “.eu”.
I’ve seen .me, .tv, .info, .name, .travel (actually some good domains on this one) and even a few .mobi sites.
Interesting to watch new extensions pop up, each with the dream of unseating the emperor of extensions, .COM.
EuropeanDomainCentre says
IDN with a mix of scripts. .asia will now introduce IDN, but I can´t see the idea behind a mix of Chinese characters + .asia. The domain has to be one script only
LS Morgan says
When tremendous keywords/key sets are available for registry, or sell on the aftermarket for peanuts. That’s always a good sign that the TLD is favored more by domain speculators than it is by people who actually intend to utilize the TLD for a productive purpose…
Even if the one-word category killers like trucks or cars or tables in whatever.backwaterTLD have a short-term mania burst amongst ‘domainers’, if you can still go and hand-register winestore or pizzashop or jumprope
John A. says
LS Morgan:
I agree with you when you say that when you can hand register good domain names under a certain extension, this is a sign that the extension is doomed.
Andrew Alleman, I do not agree with your assertion that bogus requests during the sunrise period is an indication that a domain name extension is doomed to fail. If anything, it is an indication that certain consumers think the names under this extension will be very valuable in the future.
Steve M., For you to suggest that any new extension will fail is ludicrous. I have been reading about .Gay. This extension is ideal for the gay community; a community that is shunned in many parts of the world and values information that caters to them. If anything, this tells me that new extensions in niche markets will work well.
And last but not least, someone mentioned that when a registrar gives away names this is a bad omen. I don’t agree with that either, this is simply a marketing tool.
Andrew Allemann says
@ John A – those certain consumers are domainers trying to game the system, like they did with .eu. That means all of the good domains will be snapped up by people who don’t have plans for them any time soon.
A. Mitchell says
Ahem, Stephen, there is one .eu site that I’ve found and that actually has meaning. It was put up right after France’s soccer team qualified for the World Cup in a game against Ireland that was decided on the basis of a hand ball:
http://DidFranceCheat.eu/
This one exception only proves your point.
Stephen Douglas says
@ A. Mitchell…
Lol! Good one… you soccer fans are rabid!