I’m not sure it was really going to ever happen but I was part of a group that was putting together investors for a new alternative tld. I won’t say exactly which ending we had our eye on but I can tell you this, I now have no interest in putting my hard earned money into anything of the sorts. While I am sure there are people in this industry that are much more informed than I am regarding the application process, this was my thought process as it evolved during the idea phase of investing in a new tld.
Like all investments I make I asked a simple question. “Could I get a better investment with my money elsewhere?”. After a few months of meetings and gather details, I think I can name 100 other investments that had a better risk/return. In my opinion putting the $300,000 into a top tier dot com would even be a better investment. Notice how I say $300,000.
As the information for the process was introduced it became clear it was going to cost a lot more than $185K to get things rolling. ICANN wants to make sure there are deep pockets involved and requires evidence of capital on top of the fee and that could run as high as $300K depending on the name. Evidently they feel bad about taking money from those of average wealth because only the financially stable need apply (yes I know they have the poverty application scholarship or something along those lines) . We also noticed another angle that could be played. The old “apply for a tld that a wealthy investor is going after and make them buy you out” angle.
In the guidelines they essentially tell two people going after the same tld to “work it out among yourselves” ie somebody is going to either out muscle the other with backing of a “community” or out money them and buy them out. It’s a hell of a gamble at $45K but if I had $45K to blow I see a few names where you could strong arm a few people or possibly do all the leg work and sell out early in the process. The other angle is just putting in your $5000 application fee. It seems like they are going to take a limited amount of applications and then close her down for a few years. It’s like getting an armband to come back and get early tickets. The right to get in may have a lot of value here soon depending on how many people get the “armband”
Finally the real money seems to be managing and helping the application process. One, its guaranteed. Two, there is big money being invested here and it makes sense to spend a little more to make sure everything is done correctly. ICANN doesn’t care about anyone but themselves and no doubt in my mind that they will turn someone down for some petty error in paperwork and keep their money. It says they can so if the can, they will. So people are wisely bucking up and legaling up to make sure that doesn’t happen.
My final realization was even after we’ve gone through all the paperwork and the long process we are now at square one. We have a name and now we have to go out and spend to get customers. How many of these specific names are we really going to sell? They are all such niche names that I just don’t see tremendous wealth coming out of very many. Again, maybe I don’t have the foresight to see obvious opportunity in front of me. It DID take me a while to see the value of generics. I may have missed a golden opportunity but now I can guarantee I won’t lose a dime.
I am certainly not discouraging others to apply for names. Without risk there is no reward. For many it will be lucrative. It’s just not a secure enough investment for me at this financial level.
Shane, you’ve made the right decision, absolutely! Keep investing in the TLDs we have now, there are already too many of them. I feel for those who are going to waste their precious money on the “next big thing”.
Yep. You have to millions to back a new tld and make it work. >
Take that money and buy one really good .com
Nobody will know about these new tld’s unless they advertise. >co is spending millions and they are getting on the map but I think any ext to make it will have to spend millions. When I mean make it, I mean top five after .com, net, org and whatever???????
I’m a bit skeptical. While not everyone likes the idea of gTLDs stepping into the “dot com universe”, the fun of being a gTLD pioneer (even at a portion thereof in the case you’re describing) seems very appealing. *Anything* goes with regards to the “right of the dot” and some gTLDs e.g. .music might prove to be very lucrative in the long run. And to demonstrate how far a $300k investment in .com goes, just look at the crickets at cowboys.com
Acro,
You may not have heard. Cowboys aren’t selling like they used to.
That’s what I mean 🙂 What about .cowboys? 🙂
I think you mentioned the TLD in question during DOMAINfest 🙂
“Finally the real money seems to be managing and helping the application process.”
As I’ve often said, in most instances it is those selling the picks and shovels and not the miners that get the gold.
.tv and .me are as good as any gtld anyone can dream of. And even they are having a hard time finding their place 5 years after launch. They are offered at every domain registrar and they are two characters to boot. Not to mention .jobs and .name and .ws. The only ones that may have some success are brands that heavily promote their .brand. What happens if you spend 300k + and in 5 years the cost is lowered to 10k due to lack of interest?
It might take the massive failure of this gtld initiative to finally drive home the fact that .com is the best extension to have, and that even .net, .org and established country code domains will be hard to overtop. There will be the odd success but overall it’s doomed. The only gtld I’d be all over is .web
Sounds like you made the right decision Shane.
Anybody walking into this game with less than a full picture of what’s going on is in for a world of hurt.
To do it really right, at a minimum, I can’t see anything less than a $10 Million capital investment for corporate operations, development costs, advertising, branding and marketing a new TLD. And even that amount won’t get the job done unless you’ve got a TLD that is exceptionally good for usability and gets long term traction with the public.
So the only entities I see having a shot at overcoming all the risk factors are major corporations that already have all the unlimited capital and other components you need in place and possibly startups heavily funded with tens of millions of VC capital.
So I agree, I think you’d be better off acquiring ultra incredible million dollar .COM domains than playing this super risky TLD crap shoot.