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Business News/ Specials / Tech@work/  Boosting brand value with new domain names

Boosting brand value with new domain names

Till a couple of years back, most users would have been content with just a .com address, but not any longer

A domain name allows users to access the website of a company or an individual by typing an address. Photo: Hemant Mishra/MintPremium
A domain name allows users to access the website of a company or an individual by typing an address. Photo: Hemant Mishra/Mint

Mumbai: Let’s presume you are a choreographer and have your own website with a dot-com or .com address. Would you choose a .dance if you had the option?

Or you could be a sportsperson wanting a .club, .fish or perhaps a .boutique address. You may even be running an e-commerce site with a .com address, but may want additional sites that end in .auctions, .buy, .bid, .bargains or even .compare.

Till even a couple of years back, most users would have been content with just a .com address. Not any longer.

Today, they have the option of choosing from about 150 unique domain names like .guru, .tech, .press, .website, .actor, .attorney, .builders, .home, .online, .bank, .chat, .estate, .beauty, .baby.

By 2017, the number of such unique domain names is expected to go up to 700, and eventually to over 1,000, say domain registrars.

While a .com address would typically cost between 100 and 500, individuals and companies can buy a generic top-level domain name (gTLD) for between 1,000 and 3,000, depending on the name you want. The prices, of course, exclude hosting, content and designing charges.

A domain name allows users to access the website of a company or an individual by typing an address. It typically is a name that masks an Internet Protocol, or IP number. You can buy domain names from domain registrars who, in turn, acquire the rights for these domain names from a registry.

For instance, registry operator of domain names Radix Registry said on 9 October it had acquired rights to run the .tech namespace from a US-based registry Dot Tech Llc that, in turn, had purchased the domain name from the Internet Corporation for Assigned Names and Numbers (ICANN) in September with a winning bid of about $6.7 million (around 40 crore today)—one of the highest bids for a gTLD auction.

ICANN is an international not-for-profit body that administers the domain name space or system.

Amazon EU Sàrl, a unit of Inc., purchased the .buy domain for about $4.6 million, while Top Level Domain Holdings Ltd bought the .VIP domain name for about $3 million.

Bhavin Turakhia, chief executive officer of Radix Registry, said the .tech extension “will represent the ever-growing community of users who truly understand the power of the Internet, and appreciate the value of a powerful identity online. As a techie at heart, this is an extension that I can personally relate and connect with the most".

He explained there are close to 800,000 registered domain names that include the word “tech" with an estimated 200,000 such new domains registered every year.

Apart from working with its registrar partners, Radix plans to market .tech directly to its target users via advertising, direct marketing campaigns and events that attract the tech enthusiasts and start-up communities, said Turakhia who plans to launch .tech in the first quarter of 2015.

The first-level set of domain names are the top-level domains including the earlier 22 gTLDs such as .com, .net and .org, and country code top-level domains such as .in for India.

However, in mid-2008, when ICANN gave its go-ahead for total freedom of domain names, the US- and UK-based companies and organizations applied for more than 80% of the new Internet address endings.

While the US accounted for 935 applications, Europe filed 675, Asia-Pacific 303, and Africa 17.

Google Inc. applied for 101 gTLDs, according to the full list ICANN disclosed in June 2012. Amazon applied for 76 gTLDs.

In India, Reliance Industries Ltd (RIL) had applied for domain names such as .indians, .reliance and .ril; Tata Sons Ltd, .tata; and Bharti Airtel Ltd, .bharti and .airtel.

Other Indian firms that wanted their own domain names include State Bank of India that had filed for .statebank and .sbi; Tata Motors Ltd that wanted .tatamotors; Dabur India Ltd (.dabur); Infosys Ltd (.infosys and .infy); Housing Development Finance Corp. Ltd (.hdfc); and HDFC Bank Ltd (.hdfcbank).

The new top-level domain names, however, were priced at $185,000 each for the application alone and $25,000 as annual maintenance charges. Overall, a company or individual would end up shelling out around 1.5 crore for the exercise—most of it as a one-time cost.

According to Rajiv Sodhi, managing director and vice-president of India, the local arm of an Internet domain registrar and Web hosting company, the country may have nearly 250 million Internet users, but just about 2% users (about 5 million) have bought domain names, while in the US, the figure is around 20% and 12-14% in China.

The .com domain name, meanwhile, remains the most-coveted gTLD in cyberspace with nearly 74% market share, according to RegistrarStats Inc. The other top four names are: .net, .org, .info and .biz.

However, new gTLDs also appear to be gaining in popularity.

For instance, .guru that was launched in February already has about 75,000 domain name users. Launched in May, .club has about 127,500 domain name users.

The new gTLDs, say experts, could also help increase the brand and snob value of companies while setting them apart from their peers. They add that companies that typically apply for the new gTLDs are those that also have huge advertising budgets since they will have to popularize the new domain names, perhaps even redirect existing users to their new Web addresses.

“People in India do not understand the need for an online identity. It’s here that the new gTLDs have a vital role to play. As Internet adoption in India continues to grow, having an identity on the Internet and securing the right domain name will lay the foundation for building a compelling online presence," said Sodhi who expects the Internet user numbers in India to rise to 300 million by the first quarter of 2015.

Incidentally, not every conceivable gTLD will necessarily be given to those who applied for it.

For instance, RIL, which had applied for .indians in July 2012, withdrew its application following objections raised by the government of India over the use of this gTLD by the company.

Similarly, lost in its bid for .amazon, as the governments of Brazil and Peru claimed .amazon was legally their name to use based on the fact that the Amazon river runs through both countries.

Such contentious issues are dealt with by the governmental advisory committee within ICANN.

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Published: 06 Nov 2014, 12:18 AM IST
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