We are referring to non .BRAND specification 13 TLDs here, but to new gTLDs dedicated to selling domain names through the network of accredited registrars.
The idea here is not to mention them but if some niche TLDs have certainly been a good idea in some applicants' mind, the market targeted might not have been the good one: too small maybe. Also, were enough people invited in the same room to wonder about the potential market prior to take the decision to invest or was this the choice of a single person ot two? And buy the way...were potential technical service providers invited to the meetings to push for a decision? I hope not.
I personally thought that he 1.5 to 3% population rule to decide about a new gTLD market was a good one but it appears that it was not and most domain name registration volumes have proved this today.
Niche markets have a strong potential but counting on the network of accredited registrars is not the ultimate solution to sell domain names: existing registration volumes are proving this right now. If Premium domains help generate a small income, they don't help to deploy massively: in the case of niche TLDs, it is the diaspora targeted who can help.
Some TLDs cost too much to maintain
Whether or not they sell domain names, registries already have to pay a minimum of $25,000 a year to the ICANN, "plus the rest". I saw an invoice to be paid recently at a back-end registry with a line entitled "minimum annual commitment" with a $40,000 to be paid. I found that expensive for an annual commitment... I read again and it appears that the amount was a monthly one so multiply this by 12 and you get a $480,000 a year more on your global project.
In this case, whether you sell domain names or not, you already know that it will cost you $500,000+ a year for one TLD: "plus the rest".
Many registries are "stuck"
How do you expect to develop a niche new domain name extension when your costs are so high? I want to know about the magic formula because in this case, I don't see this as possible, especially when 1,038 registries on a list of 1,226 have less than 10,000 domain names registered (apologies for including .BRAND new gTLDs in these numbers but I am lazy).
I can understand that a company wants to pay the price to acquire a monopolistic position but I don't understand that a company starts a registry project with a monthly fee of $40,000 for nothing. There is a much better negotiation to have with a backend registry today. And of course...I am not even talking about the leaving fees which are just...ridiculous. A registry should not sign a contract with a backend registry if it blocks the entire project to develop.
I shared with a friendly backend registry recently and he told me: "Jean: there is no magic solution to develop domain names", and I wondered: "Wow, he is a backend registry and he has absolutely no imagination". There are solutions:
- There is one that I have seen working, it is similar to parking domains and combining the automation of SEO on a large amount of newly created domains. Added to this, bla, bla, bla and bla, bla, bla. You will have to call me for more ;-)
- But there is another one that can match (not for all registries) if both the registry and the backend registry have found the right agreement to lower the price at the minimum at the backend, agreeing on a certain volume of domain names to be installed and paid. Same here, you will have to call me for more.
- There is another one which requires that your application can be changed and that your TLD is not yet launched, but if you have no imagination, you should certainly not read about it.