Threats to the Domain Name Industry
There are two main issues that keep me up at night.
First, I’m becoming more and more concerned about hucksters and deep-pocketed corporations coming after average joe domainer.
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Second, nearly all of the ad revenue in this industry is concentrated with two companies: Google (GOOG) and Yahoo (YHOO). This means they get all of the control and there’s little to keep them honest.
Andrew writes about a very important topic here. The domain industry is becoming increasingly attractive for investors with deep pockets, especially since other investments aren’t as secure as they used to be anymore, but that’s not only a good thing. Some companies and investors who have been late to the domain game try to catch up by suing domain owners for their domain names or by doing their best to maintain the negative image domainers have had for so many years. CADNA would be an example. While I agree that domainers must cooperate with trademark owners to fight cybersquatting and typosquatting, we must also make sure that they don’t go too far by cutting the rights of all domain owners.
Another organization domainers must keep an eye on is ICANN. ICANN and VeriSign will continue to raise domain registration fees, which costs domain name owners millions of dollars a year in extra renewal fees!
As for the second point Andrew refers to, every domain owner relying exclusively on domain parking is extremely vulnerable to decisions by the big pay-per-click companies Google and Yahoo. Just imagine Google decided to stop monetizing certain types of domain names or to stop serving the domain channel at all. Google would certainly prefer web users to get to their desired destinations through GOOG’s search engine rather than by direct navigation. This extreme step is unlikely, but it shows how much power Google and Yahoo have over the domain industry. Large companies like Marchex and Communicate.com would get into some serious trouble if domain parking came to an end. Therefore, you, as the owner of valuable domain names, should make sure to have alternatives for monetizing your domain names’ traffic in case parking revenues go further down.
Help, a competitor bought my Web domain!
(FORTUNE Small Business) — Dear FSB: Both the name and URL of my company’s website were registered with a domain name registration company. After more than five years they have sold the URL for my company’s name to another person who now runs it in competition to mine. Do I have copyright to this name and URL?
This short FORTUNE article illustrates one of the threats mentioned above. Many businesses which failed to register their company-name.com in time are now going after the owners of those domains. Now, I don’t know this specific case, but in many cases the companies do not even have the right to sue the owner of the domain, because it was registered before the trademark and business were established and the domain isn’t even used “in bad faith”. (Regarding “bad faith” use of a domain name, you should read about the MySpace.co.uk ruling I wrote about two weeks ago.) They feel tricked, because someone else registered the domain before they did. In extreme cases desperate companies have even tried to sue the owners of generic domain names! Again, we have to fight cybersquatting, but it is important that owners of generic domains are protected from being wrongfully sued.
If you are a domain owner you are involved in something much bigger than the domain business- you are in the media business. The success that domain owners are enjoying today is a direct result of a historic upheaval in the media business that is shifting advertising expenditures away from traditional outlets and onto the Internet.
As one of the few publishers that have successfully navigated the treacherous straights between print media and the new world online, Boulevards New Media founder and CEO Dan Pulcrano gave us a unique opportunity to take you beyond domains for an inside look at the larger forces currently shaping our industry. Forces that are precipitating the fall of old media empires offline and the rise of new ones on the web – a seismic shift hat has put owners of high quality domains in the catbird seat.
This is a great article by Ron Jackson from DN Journal. In this latest cover story, Ron writes about Dan Pulcrano, founder and CEO of Boulevards New Media. Pulcrano’s company owns and operates very good geographic domain names, including some of America’s biggest cities: LosAngeles.com, SanFrancisco.com and Philadelphia.com. Boulevards New Media shows that developing domain names can greatly increase their reach and value, which is just another reason why you might want to consider developing some of your domain names instead of parking all of them.
Before You Develop Domain Names
If you are like many other domain investors, you probably have quite a few domain names with an idea of how to develop each of them – or a thought about what type of website each could become. As mentioned on this blog and on other blogs, development is difficult. If you are strongly thinking about developing (and not just contemplating), I would like to offer a few suggestions to help you decide which name(s) to develop and how to plan it out.
I believe that in 2008 we will see a lot more generic domains being developed than in any year before. The plunge in domain parking revenue might be one reason for this. I’m going to develop one or two domains myself this year, so I’ve been surfing the web on the search for good examples of developed generic domain names. An article about this topic I found very interesting is this newest piece by Elliot Silver. Elliot has just recently started developing Lowell.com and he has been sharing his thoughts and experiences on his blog for a while now. In this article he gives good suggestions about which domains to pick for development and what to concentrate on when you’re just getting started with your development project.
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