Schwartz vs Schilling. The Recap.

Morning Folks!!

I am certain that in the days ahead you will read many accounts of the seminar that folks might talk about for a very long time. It was as good as billed and perhaps better!

There was passion from each and every person on the panel and the debate was respectful but intense. I think the result was more clarity on each side.

.Club had a point of view and .Kiwi had a point of view.

One of my favorite points of the debate is when Monte and Frank disagreed and they were on the same team. That was priceless.

My partner was Lonnie Borck and for those of you that know Lonnie, he is sharp and smart and was able to boil it all down to simple things. Like .whatevers MUST sell to survive while with .com there is no concept to sell.

The basic disagreement I have with Frank is that he believes .whatever will devalue .com and I believe it will do just the opposite. Increase the value of .com Nothing I have not said right here on this blog before. Many times. I look to history for my answers.

I compared the prices of .com domain names today with the historical salaries of baseball players. I believe that domains are on a par with what Babe Ruth made or maybe as fas as Mickey Mantle. But these guys never earned the tens of millions stars earn today.

And even as Football replaced Baseball as the National Pastime and Nascar has become bigger than both, salaries in baseball continue to go up.

So I put that question to the attendees and the vote was overwhelming that .com prices would go up as a result of all this.

9-rick-frank-punch-620

Photo Lifted from: http://www.dnjournal.com/archive/lowdown/2013/dailyposts/20131021.htm

Howard and Danny did "Man on the street" and the interviews were more than surprising.

One young guy in his late 20's said Facebook is where his company website is. The crowd laughed.  He said is website was under construction. More laughter. Two said they did not have websites and don't want one. That surprised many. None knew of the new gTLD's. So the point is while we know this and that because we do this fo a living, Main Street is far behind and I think the audience was stunned by how far! These were just random small businesses that were picked.

We touched on many subjects and as I said, there will be a number of stories about what took place and it was all good!

I want to thank Frank for doing this with me as well as Monte Cahn from Rightofthedot.com,  Jeffrey Sass of .club and Tim Johnson of .kiwi and Lonnie Borck.

We did record the session and we plan to put it online for all to see. I am certain you will enjoy it and find great value with it. It's just a sample of what we do at TRAFFIC. Should be online within the week. YOU be the judge.

Rick Schwartz



26 thoughts on “Schwartz vs Schilling. The Recap.

  1. kris

    Thanks for the recap Rick! I wanted to drive down to the conference but was unable this time. I am another newbie to the industry so I am hoping to catch the next one. Have a productive week!

    Reply
  2. Warren Royal

    Rick – thanks so much for deciding to share the session video. I had planned to attend but had a last-minute conflict so was unable to get away. This was one of the sessions I was looking forward to – so it’s great that you are willing to share it. Thank you!

    Reply
  3. Observer

    Some of the new age artworks are traded at high prices. But they never devalued the works of Raphael, Piccaso, Gogh…. Masterpieces do not lose their value because of the emergence of new similar works.This is the FACT evidenced by realities.

    Reply
  4. M.G.

    Most likely you are both correct. I think we will see an increase in value for great .com domain names and devaluation of value in shitty .com names. So premium short .com name that costs now $1mm will cost double and long-pigeon-shit-name.com that sells now bellow $100 will be hard to sell. If that is going to happen, then both of you are right, but I am not interested in pigeon shit investments, so for me the increase in value of .com is the answer.

    Reply
  5. DrDomainer

    This is the most exciting time in domaining so many things are about to change. Thanks Rick and Frank and everyone else involved at TRAFFIC.

    It’s going to take years to find out who holds the champion domain mentor title. Something tells me Franks going to hit the floor in the first few years.

    Reply
  6. And The Winner Is...Rick!

    Frank is a newbie and hasn’t learned his lesson yet. I agree that he will be going down. And it shouldn’t take long either. They say a fool and his money are soon parted and sadly, we are about to see that happen. The gTLD’s are for suckers. Plain and simple. Hey, wasn’t Monte and Moniker a huge promoter of .MOBI too? Seems some people just never learn.

    I like Lonnie’s summary that .whatevers must sell themselves or die. The last tld that faced that dilemma was .xxx and we know how that story ended. Combine that with the man in the street not even being aware of the gtld’s existence and Frank and friends will all be finding themselves with a huge problem on their hands.

    Reply
  7. Domainer 888

    Was Schilling on hallucinogetic drugs? If you were to lock me in a room and not let me out until I had a convincing argument to support gtld’s, I’d die of starvation. There is absolutely no benefit of owning one other than the opportunity to lose traffic to the .com competitor. Oh, and you get to annually pay more for the honor AND risk the sponsoring business going bankrupt. Donuts, anyone?

    Reply
  8. UFO

    @M.G.

    Correct. But, the question is whether the new TLDs will have sufficient impact to even devalue 3 word .com’s. There is a certain level of critical mass required to get the message across to the average person on the street. Confusion alone is worth more than $100 so if the .com is $100 then it still holds its value.

    Reply
  9. M.G.

    @UFO – To be clear. I do NOT support new gTLD program and I am afraid that confusions will just make money for lawyers. I don’t like direction of ICANN, I hate UDRP and I don’t care about 3 words long shit domain names, regardless of its extension. I stay with short .com names and I will just watch .whatever program with no attention to register any dot-shit.

    Reply
  10. Owen Frager

    I was there and it was priceless must see TV. I made the analogy of 2008 and Wall Street fell and many banks collapsed. Chase bought up all the Washington Mutual (which was a once hot bank of the west coast “free checkind and free smalls” I carried with to me to Florida). Within days of the bust every Washington Mutual had been transformed overnight, not just in logos, color and paint, but with kinder and better trained people and instant upgrades in service. Chase invested billions in this branding and reined disruption to IT to merge the different platforms this because the GAINED customers and in some cases, prime corner real restate the banks sat on. Name change gave many advantages to consumer and also to buyer. They Washington Mutual customers were getting an upgrade to better service and lower costs. The bank was getting real estate and customers from Day one.

    If everything they say about TLDs all the buyer gets is a name, unknown, unproven that doesn’t bring traffic and customers like buying an aftermarket dotCOM with Traffic would have. Lots to think about and as Nancy Grace says “Call in the lawyers.” The “g”s are really THEIR moment , THEY will get the most out of it. I give the debate to Lonnie and Monte though!

    Reply
  11. Leonard Britt

    I look forward to the video. Note that the Discovery Channel recently ran a segment on the California gold rush of ~1849-1850. Interestingly the individual who made the most money was not the one digging for gold but the one selling gold digging supplies & equipment – Samuel Brannan. However, when he realized that the large mining companies from the east were about to arrive to California he decided to buy the land where the miners were digging – hoping to resell it at a huge profit. Instead, they used politics to make California a state and his land claim became worthless. The land was auctioned off to the highest bidder. He then tried to develop a prominent resort community and sunk his fortune into it. So one of the richest men from the gold rush died a poor man.

    Reply
  12. UFO

    ‘California gold rush of ~1849-1850. Interestingly the individual who made the most money was not the one digging for gold but the one selling gold digging supplies & equipment – Samuel Brannan.’

    Thats why the registries are going to do the heavy sell on these TLDs. They are selling a dream which they themselves might not even believe in, plenty of sales people don’t believe in the products and services they sell. (And if they believed in the dream they’d keep the domains for themselves – which they will with the decent names and sell off the cr*p and with the best names sell at market which gives no incentive to any domainer).

    The registries are selling fools gold.

    Reply
  13. UFO

    It’s going to be interesting to see how Donuts Inc comes out of this. It looks like it’s extremely well backed by what I’d think are extremely naive institutions. Donuts looks like a newbie domain buyer that just buys everything before realising they’ve wasted money on cr*p. Donuts looks like its taking it to a whole new level by going after 300 TLDs… sheeze.

    If you look at all the extensions Donuts have gone after they seem to be complete cr*p, and that’s being kind. These TLDs WILL FAIL, owning 300 TLDs isn’t a lottery, its not 1:7 success ratio, if it’s all cr*p it’s all a liability.

    The ONLY area of redemption may be that owning 300 TLDs gives sufficient management economies of scale that the break even point is low enough they turn a profit. But with all this competition and the likes of the registries dropping registration costs there may only be something like a 10c mark up on ICANN charges versus retail so the run costs and volume breakeven’s become impossible to achieve… unless they have a seriously solid method to cross sell/up sell other services.

    They’ll be cap in hand asking for more funding to buy complementary businesses such as hosting etc.. in an attempt to extricate themselves for the worlds biggest money pit. It will be more bad money after good, simply because if they could get it right on something simple then why would they be any better on something complex.

    I wonder if they did a whole bunch of diligence on the likes of .mobi .xxx etc and worked out the level of registrations to see any potential take up of their domains. But their TLDs are worse by a long shot.. long, off target etc etc.

    A random scatter gun approach isn’t strategy.

    I guess they really want to the worlds biggest pigeon sh*t farmers, lets hope there’s money in the scale of fertilizer they’ll be ‘cleaning up’ with.

    Reply
  14. Jeff Schneider

    Hello Rick,

    I dare say you had a distinct advantage in backing the .COM channels 20 cosecutive year Market leading advantage Looks like you are riding Seabiscuit at the lead of the pack. Congratulations on picking the right horse. Isnt it nice to be on the right side of the equation?

    The SMART money is right now and into the future, choosing their horse to ride and ignoring the .whatevers siren call.

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

    Reply
  15. Jeff Schneider

    The marketing Grifters, are turning up the volume of their Siren Calls, to deafening levels. This whole experiment which predicates itself on acquiring (Vicariously) , succes predicated on the .COM track record of the last 20 years is an EPIC FARCE !

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

    Reply
  16. M Altaf Hossain

    First of all, Rick looks energetic and buoyant in the winning bout with his .com value. Thanks for sharing all about the event & focusing the seminar. All those could not attend the T.R.A.F.F.I.C will surely get huge benefits once the videos will be released on the net.
    Why the new TLDs will take lead while the old TLDs are still suffering?

    Reply
  17. UFO

    @Domenclature.com

    What donuts doesn’t get is it needs millions for legal cases, because I can assure them that no major .com owner is going to allow them to create confusion and it associated economic cost.
    If they use e.bet then ebet.com will have them in court and I’d bet they’d win because in my experience there is enough evidence around to show confusion. ebet.com would just need to review user logs and see any traffic type in’s for e.bet.com or google search in analytics for e.bet.com. Also, I’d think they’d win because of the massive implications it would otherwise cause for trademark case law which has been built up. I’d suggest ebet.com take out soem defensive registrations for ebet and claim any domain for cost from e.bet

    I seriously think these new TLDs are unaware of the potential litigation that could come their way. They want a free lunch on keywords that are HEAVILY trademarked across the world.

    IP attorneys will be rubbing their hands in glee… their clients will be made aware that’s for sure.

    Reply
  18. UFO

    These registries also open themselves up because they are engaging in transactions with domain buyers re rates they set for leasing certain domains. At the start with .com at least they were just charging a recovery rate and it was on the basis of first come first served. .com was not a trademarked keyword, new extensions are often trademarked keywords and there are plenty of common law rights attached to all the other prior domain name users.

    But this statement by Paul S needs to be addressed on the link you provided

    “something I don’t get: I don’t get why someone would buy ebet.com for $1,355,000 if they could buy e.bet for $135. I DO get why someone would SELL ebet.com for $1,355,000 when they know that .bet will soon be in the root.”

    Well, firstly they wouldn’t be handing out e.bet for $135 Pa registration fees, because Paul S himself talks about leasing domains for $5k Pa.

    Even if Donuts gets .bet they’ll have to stump up far more at auction to get it so that will increase their needs for recovery through registration fees or up front sales. Secondly, if eBet took them on legally I think they would be forced to either deregister the name or resolve it for free. NO trademark holder should be racketeered into making another company profits in defence of what is rightfully theirs. If a registry issues a domain and profits through illegal use against a trademark holder then they are culpable. Profits are made on registration fees.

    Paul S also doesn’t quite get the notion that in order to engage in a betting business you need a licence. You only need to look at the number of licences issued each year to see the sum total of the market. So they’ll need to sell to new entrants at a rate favourable to buying a .com and to speculators that will sit on the names… at $135 Pa though? The price sensitivity (elasticity) of domain holders is quite high given negligible cash flows and uncertain outcomes.

    These new registries also have no credibility in the market; any substantial entity would need to assess the security of the domain name they would use to run their business off. .com is AAA+ security and registration fees kept under control.

    Donuts Inc appears to have stretched itself by the simple admission of being open to further capital. My guess is that they’ll not have the fire power on the decent TLDs at auction and get lumbered with all the crappy TLDs. I bet if I was an investor and asked them for all their business cases on each TLD they applied for I wouldn’t be able to find detailed market analysis and logic reasons for each of their applications. My guess is they had xx million to spend and they spent it all, Bet they didn’t spend a year sweating over investing 55m into application fees because if they had then they wouldn’t have applied for TLDs like .LIGHTING because any number of other extensions would have better market potential, sheeze a quick scan through the yellow pages would show better verticals… like .bar .plumbers .builders in that’s with 2 seconds of thinking. But even then you’d need to prioritise them and run a whole bunch of metrics to assess the greatest profit potential TLDs.

    Reply
  19. Logan Flatt

    @Leonard – the equivalent in the domain industry today is the bloggers (e.g., Morgan, Elliot, etc.) — they likely make more money selling information and eyeballs with respect to domaining than they do actually domaining. I cannot substantiate that, but that’s my guess.

    Reply
  20. Jeff Schneider

    Hello Rick,

    The most likely future paradigm shift in attitudes towards extension valuations, from a Marketing Analyst such as myself, fall heavily in favor of the .COM Channel.

    Of course the Smart money already knows this.

    Just remember the money Frank is throwing around for hedging his bets, was and is being raked in due to his massive .COM portfolio.

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

    Reply
  21. Jeff Schneider

    Hello Rick,

    We are all interested to see just how all these competing countries .whatevers will be recieved amongst each others competing market places?

    If I were an investor in .whatevers I wold really have to hesitate a little and wonder if my .whatever will even resolve in other competitors browsers????

    We know one thing for sure, .COMS are the most widely adopted and accepted addresses that resolve World Wide.

    Just something to think about ? Will .whatevers be granfathered ?, like .COMs ?

    Reply

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