Team Schwartz vs Team Schilling Part 1 and Part 2 Plus My Personal Thoughts

Morning Folks!!

I was going to post this last week and got a bit derailed.

So now that both Part 1 and Part 2 of Team Schwartz vs Team Schilling it is time to post how I see it.

First, I don't think there is a winner or a loser. I think we just have "On the record, for the record". I think we all presented a brief point, counterpoint and I think it was entertaining, informational and productive and it was very serious because it deals with where you may or may not invest your hard-earned money. In a few years we will look back and then we will see.

Frank and I are friends and we have never had a cross word. That does not mean we have to agree. Berkens and I are friends and we too disagree some times. But we duke it out with thoughtful debate and we let the future sort out things like winners and losers.

I heard arguments that I had not heard before. Some made a lot of sense and of course I was quick to point out when it made no sense. But we all have one thing in common, we are looking for answers. Some have a more vested interest in it than others, but answers are what we seek.

I look at it and while it was really a perfect opening, it was just that, an opening. There is so much more to discuss and understand and to either reject or embrace.

It's not up to me whether their vision becomes a reality. I can only bet on the outcome. Invest in whatever direction I see it going. Like everything else in life, I may bet right, I may bet wrong. But as a businessman and an opportunist, I will look to history and the empirical evidence that has already been gathered to help me decide.

And while many would like to forget about .mobi and .aero like the public has, we can't ignore their outcomes. Their success is not our success. Nobody to blame for that. Just how the chips came down. Same with most of the others.

So out of 700 I am pretty sure that 7 of them will come to challenge .net or other tld. Maybe some country codes. Maybe not. Great and Unique Content and successfully establishing viable businesses will determine the outcome more than any other single thing. Registry success does not translate to investor success. Two different ballgames. I am sure many will find some degree of success.

Monte says .Travel is a successful registry. That may be true. But I would not invest seriously in that tld. Or .aero. I have nothing against them. If they make money or not has ZILCH to do with me. I just don't think it is a wise investment when there are so many better choices. Especially if you flip domains for a living.

But what really is crazy to me is the notion we are running out of .coms or that .coms are going to be old-fashioned. That is just loony tunes to me with all due respect. I don't think crazy talk helps their cause and actually hurts them. I think it turns people off. I may be wrong. I can't speak for everyone but human nature does have a reaction and it is not the one they want. Especially when I can prove it with simple numbers and an example with TopPlumber.com.

There will be opportunity whether this succeeds or fails. Whether there is confusion or not. But you can predict with a pretty good degree of certainty that if they discover their efforts are not being fruitful or their customers are confused that they could care less about anything but stopping the bleeding.

I talk about how I see 700 horses in the starting gate and I don't know how most of them don't get trampled by the others. They disagree among themselves. They each have different self interests so none will be playing from the same sheet of music. That equals chaos. You can see it from here. You don't have to wait a year to see multiple collisions of all sorts. A few scams and an extension could be out of it!

Like I said, we have only touched on some of the issues.  And at the end of the day it will be a gtld by gtld race. Some will be viable and some will die on the vine and that is already happening. All forseeable.

There is so much more to debate over. Reality will determine the winner. Not you, me or anyone. We all just make our case. We put our money where are mouths are. Frank certainly has devoted many millions to what he believes and like Lonnie said, if anyone is going to make it, it will be Frank. I like .link but I don't get .tattoo. I have to look over the rest of his list and again, it will be a .whatever by .whatever decision. .tattoo won't be high on my list. But Frank estimates 25,000 registrations.

Each Registry I talk with throw around numbers that may have made sense given the current levels of extensions but I think are a little ambitious given 700 breaking at nearly the same time. So their biggest obstacle may be their own projections.

Either way the landscape could change drastically in the months ahead. As I have said, once these folks start hiring staffs, their sheer numbers will overwhelm us. It will get noisy. So don't be surprised and don't be surprised if I don't win any popularity contests. Anticipate and be ready for what is coming regardless of the success or failure of any individual extension.

My MAIN position is that after the dust settles and we have the carcases of 695 .mobi's lying around, that will be the fuel that finally accelerates .com prices to the levels I believe they are worth. I think we are already seeing that.

It is ok to build on any gtld. But you MUST own the .com at some point to continue your growth. Not doing that is a dereliction of duty. If you are in charge and you make a mistake like that.....you should no longer be in charge. That is why to this day I scoff at that Madison Avenue panel in 2007 that said it was all about "Budgets". Sorry, budgets don't count when you must make a decision for the next 100 years! I don't think budgets matter when your house is burning down. I don't think budgets matter when you have a heart attack. Budgets are guides they are not tablets written in stone! Listen to THE Dumbest answer I have ever heard since I have been in business.

Rick Schwartz



 

 



18 thoughts on “Team Schwartz vs Team Schilling Part 1 and Part 2 Plus My Personal Thoughts

  1. DrDomainer

    gTLDs that have high (CPC) keywords might stay above water.

    Franks other videos are great!
    I don’t like the .tattoo video
    it has so many things wrong with it.

    http://www.egypt.travel is advertised everywhere in London at the moment and its top of google
    in UK

    egypt.com must be very happy with
    all these free very profitable leads.

    Reply
  2. Federer

    It’s very simple:
    The new gTLDs are a solution to a problem that does not exist.
    They are not a major opportunity for investors and they will have little market value (resale/end user).
    However the new gTLDs are a fantastic investment opportunity for the registries and at least 10%-15% of them will thrive and be very profitable.
    Hence the never-ending grand divergence of opinion (investor/registry).
    Instead of constant speculating, let’s just wait and see.

    Reply
  3. UFO

    New gTLDs WON’T be a good investment for any domainer unless the registry makes them part of the founder of their gTLD, by this sells them some names at a cheap price to help recoup initial outlays.

    (There is a very good business model going forward where domainers all chip in and get themselves a gTLD).

    Many of the registries will be successful, along with the gTLDs simply because the actual marginal cost of running them post delegation is low along with the ICANN rate for new domains I.e. 25c. So it’s difficult to see any registries going bust. That said, some may find it difficult to recoup their initial outlays, but on the whole it seems risks are limited and the unpside huge. No wonder so many took the chance. Also, these initial registries are in a good position to run other gTLDs and if all the .brands start lining up then there could be huge amounts of business to be done.

    Reply
  4. Dan

    Good perspective Rick. Agree with your sentiments, particularly regarding the “.com’s running out” myth. The same myth gets perpetuated in the UK about real estate. The truth is, there is plenty of capacity and opportunities for those that make the effort to seek them out or are flexible. Clearly what there is not, is the best land (a la domains) available any more at the same prices one could have expected to pay “in the early years.”

    To get a premium .com, is like a retailer having to make the investment on a quality store on the hight street, and let’s face it, you aren’t going to get that for nothing either! I’m still bemused by the simple business model for many of the .gTLD’s.

    $185,000 Application Fee
    $25,000 a year Registration Renewal Fee
    $1.5m+ current average contention auction settlement price (unless I’m mistaken)
    $Xm… Operational, Marketing, Management costs.

    = The best keyword.whatever’s need to be sold off by the new gTLD registrars for just as expensive, if not more so than acquiring higher quality .com equivalents in the current market just to allow the new registry owner to get back on their investment and make it a profitable venture?!

    Am I wrong?

    Reply
  5. Jeff Schneider

    Most Large Corporate End-Users have participated in the least regulated under the radar, (Shadow Market),of undisclosed purchases, for .COM Franchise Foundation Addresses.

    The current Blustery Promotions for the gTLD Experiment, is a perfect cover for them to operate in and divert attention away from their preferred hunting ground for the prize .COM Franchise names still available.

    The .COM Shadow Market has been a perfect way to control and subvert Prime .COM valuations. The manipulation we have seen so far may just be the tip of the iceberg.

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

    Reply
  6. UFO

    @Dan yes potentially you are.
    The best .whatever isn’t necessarily the best .whatever to buy. Simply because there is the auction for those that want the extension.

    In my opinion during this round it was potentially quite easy to get a .whatever for no contention additional amounts even though the extension may well have been sitting on a million+ name.

    Hence, .whatever < .com with all the benefits of issuing additional names for $$.

    You don't want to be paying a massive premium as everyone will make the .com v .whatever trade off in the future.

    There isn't that much difference in marketing terms between, example.whatever and example.whatever.com and only the best of brands would want the .com removed from the equation.

    Reply
  7. UFO

    Domainers have to realise that .whatever is more likely to get traction going forward than they realise. The benefits aren’t via scarcity but actually on memorability.

    I do though think .com has a lot of legs on it and will be the extension to have for the next 20+ years. The early adopters of .whatever will be the ones paying for the promotion and not receiving the benefits, whereas .com owners receive the benefits of .com without even having to promote it.

    Hence, most rational businesses will stick with and stay on the .com because 20 years is too far on the timeline, but it will come slowly in, just a slow tide of change.

    Reply
  8. Jeff Schneider

    Hello UFO,

    You might be right accept, Most Experimental Technologies obsolesce very quickly. Our experience tells us the gTLD Experiments (excluding .brand) have been Introduced too slowly and has more than likely osolesced their usage and effectiveness.

    Reply
  9. UFO

    @Jeff, my guess is that gTLDs will not push out .com in commercial areas. They will gain significant traction in social media areas.

    For the next x years, there will be a conveyor belt of new hacks and gTLD sites that will migrate to the .com on the basis of leakage and recollection / authority.

    As it stands this round won’t be sufficient to make a noticable impact in consumer minds, if the next round in 5 years has all the brand holders lining up then we could see change then in the following decade.

    My final guess is that if you have decent commercial .com’s you are ok. If you have 4 worder .coms and social .coms then you have potential competition but its 10 years away.

    Reply
  10. UFO

    Nb: anyone should feel free to comment on a more detailed ‘my views’ on my blog. At the moment my blog is like these new gTLDs, good idea but no traffic… lol.

    Reply
  11. Altaf

    I cannot understand why all the experts here unnecessarily argue with new .glds while there will be no end of .coms-the king for ever. Useless discussions, wasting your valuable time & our/folks’ time to read it.

    Reply
  12. AlanR

    A domains worst enemy is the investor or domainer. So like all the other tld’s that went bust, none of these new tld’s will really get a chance to get off the ground either. It’s the end users that give a domain value and like with past history, the end users won’t be on an even playing field since all the good domains in each extension will be snapped up by investors before the end users are even aware there are other choices. Everyone should take Monte’s advice when he said that these new extensions are not for the people in this room. But then, he just might have given them a bigger reason to buy them if you consider reverse psychology. So instead of end users creating a domain’s true value, the domainers will create a false value by trading among themselves. So in other words, if an extension gets popular, beware because it will be over run by domainers and will surely go down in a big way! Bucko

    Reply
  13. Jeff Schneider

    Hello Rick,

    Here’s a Big (What If ?)

    What if some of the cleverest domainers like RS and others such as Large Corp. End Users, along with Chinese collectors are piling into the Dark .COM Shadow Market ???

    Gratefully, Jeff Schneider (Contact Group) (Metal Tiger)

    Reply
  14. UFO

    @Jeff S

    Yep, I think it might be the Chinese that really push the .com to some serious heights. If they do then .com may always be the absolute envy name. If all decent .com’s are a million plus then it becomes one of huge stature to own one.

    The best 5000 .com’s are worth at most 5 billion. Thats nothing if you think about the amount of commerce that can go through them.

    geeze, Facebook can actually think snapchat is worth 3b, twitter how much? and the worlds 5000 best .com’s only in that region.

    Something is seriously undervalued.

    Reply
  15. NEIL

    In Rick We Trust!
    eTraffic.me if you can, with 6 word extension…
    icann is growing up like a hot air balloon, speculating the recession momentum, when everybody buys everything, hoping to see the light at the end of the tunnel.
    Good move. Getting Rich ASAP. Schmuckx.com!
    Welcome back, King.
    Back to Your dotcomkingdom.com, the soul’s wounds will heal sooner…

    Reply
  16. Wrong Number

    Rick,

    Please wake me up when this .whatever garbage is passed and we can get back to discussing our .com’s since that is all that is ultimately going to matter. The .whatevers have a snowball’s chance in hell of ever being accepted by the public.

    Reply
  17. Kassey

    ” At the moment my blog is like these new gTLDs, good idea but no traffic… lol.”

    @UFO, you have my support at the least. I find UFO’s blogs have insight. While his blog is new, I find myself visiting his site regularly. He’s a good guy to discuss with and learn from.

    Reply

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