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Moment of truth as first seven new gTLDs go on sale

Kevin Murphy, January 29, 2014, 13:44:59 (UTC), Domain Registries

We’re finally going to see if there’s any demand for new gTLD domain names.
The first seven new gTLDs — .bike, .clothing, .guru, .holdings, .plumbing, .singles and .ventures, all operated by Donuts — hit first-come, first-served general availability this afternoon.
I understand that the precise time they’re due to become available is 1600 UTC.
But these are going to be unlike any new TLD launches we’ve seen to date.
We’re unlikely to see the kind of mad gold-rush that was enjoyed by the likes of .mobi and .co in their first 24 hours, largely due to the high prices Donuts intends to charge for early adopters.
Under its Early Access Program, any domain registered in these TLDs on day one is going to cost over $10,000 for the first year. The price will come down to $2,500+ tomorrow and will be reduced each day until settling at regular pricing a week from now.
Go Daddy, which commands about half of the retail market, has previously indicated that its day one pricing for Donuts’ gTLDs will be $12,539.
Judging by the Go Daddy web site today, it’s treating EAP as one of its “priority pre-registration” phases distinct from general availability, which it says will kick off February 5.

The EAP is Donuts’ alternative to the landrush-with-auctions model we’ve become accustomed to in previous TLD launches.
The questions are whether this will affect domain investors’ willingness to dive in and grab some premium real estate and whether it will encourage actual end-users to register early.
It seems pretty obvious that while day one of GA for Donuts’ gTLDs is the first big test of its pricing strategy, it’s not going to be the yardstick for volume performance that we’ve seen in previous launches.
I think it’s a pretty safe bet that today’s volumes for Donuts will not come close to GA-day numbers for the likes of .co, .xxx or .mobi, which were in the five or six-figure range.
But with pricing for .bike et al today literally 200 times more expensive than .xxx’s GA pricing, Donuts doesn’t need to sell a great many names to have made a nice return.
ICM Registry said it sold 55,367 .xxx domains in the first 24 hours of GA back in December 2011. With a registry fee of $62, that’s revenue of $3.43 million to the company.
To make the same amount of money from a single gTLD such as .guru, with its $10,000 (I believe) registry fee, Donuts only needs to sell 343 domains today.
.CO Registry sold 194,000 domains in its first 24 hours, at a registry fee I believe was $20, for approximately $3.88 million in revenue. Donuts would only need to sell 388 .clothing domains to make the same return.
These might be achievable numbers. .CO, which operated a landrush-with-auctions period, sold at least 38 domains for over $10,000 and 227 for over $2,500, based on its published results.
Volume matters for the long-term health of a gTLD with public visibility and an aftermarket, but not so much anymore for the financial health of the registry itself.
UPDATE: An earlier version of this story reported that the premium EAP prices recur for every year of the registration. They actually revert back to standard Donuts pricing in the second year.

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Comments (11)

  1. james says:

    So what date will the real general availability kick in without the early access pricing – 2-5? If so, what will be the price?

  2. M says:

    When the Cyrillic ccTLD was launched in late 2010 (.рф), They saw 100k registrations in the first two hours and a total of 200k registrations in first 24 hours.
    Currently has just over 800k registrations.

  3. Andrew says:

    I’d argue the moment of truth is after EAP when prices drop.

  4. Chris says:

    Five days of EAP = February 3rd…?
    One thing’s for sure – very very few names will see the ROI necessary to make buying first-day relevant. I’d bet on this plan not being seen after 2014.

  5. Do you have access to Donuts zonefiles for these TLD’s? Are there any numbers for the amount of sunrise requests activated in the zonefile available for these TLD’s?

    • Kevin Murphy says:

      There’s been no change in the zone files all week. I’ve been checking.

      • Strange, we have seen all sunrise requests for our clients become active yesterday morning (CET). So that’s well over 24 hours ago.

        • Kevin Murphy says:

          Some Donuts zone files, including these seven, started being delayed by one day last weekend, as accessed via the ICANN service. I don’t know why. It’s either a Donuts problem or an ICANN problem. It certainly wouldn’t be the first CZDAP problem I’ve encountered over the last three months.

  6. The first seven days of General Availability have the higher pricing (though the price declines each day) . Day eight, which starts at 0800 Pacific on Wed Feb 5, is when all domains are at their usual price. Renewals for names bought in days one through seven are also at the usual price.

  7. Andrew says:

    @ Bart – I have access. The files do not yet show sunrise domains.

  8. Gerry says:

    The gtlds are all so stooooopid. Who is ever gonna want to pay an exponential premium for one? Not me! Why- to have your visitors accidentally go to the .com site? So you can worry about losing your misdirected email? Or to have the sponsoring registry go under after selling only 9 other names worldwide?
    Great idea in 1994. Really really really bad idea in 2014.

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