Domain name rush 2.0?

Last week's decision to allow companies to buy their own top-level domains (TLDs) has led to press forecasts of a land-grab similar to that of the late 1990s. Nora Nanayakkara, director of business development at domain marketplace SEDO, believes this prospect may be exaggerated.

‘You need substantial means, about $500,000 [£250,000] to purchase your own TLD,’ says Nanayakkara. ‘Businesses need to step back, evaluate the situation, and decide what benefit they can really draw from this.

‘Otherwise the only people to make money out of this will be [domain registrar] ICANN and intellectual property lawyers.’

Nanayakkara claims that previous TLDs such as .pro and .aero have gained limited popularity as consumers stick to what they know, while domains ending in .co.uk or .com are still affordable, attracting average prices of around $3,000 and $2,500 respectively.

Domains ending in .co.uk have increased in price by an average of 22 per cent over the past three years, while .com domains have fallen in cost by 18 per cent, according to SEDO figures.

Marc Barber

Marc was editor of GrowthBusiness from 2006 to 2010. He specialised in writing about entrepreneurs, private equity and venture capital, mid-market M&A, small caps and high-growth businesses. More by Marc Barber