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What Does the .CO Launch Mean for New gTLDs?

Antony Van Couvering

The .CO top-level domain made over $10 million in just a couple of months. What do the results of the .CO re-launch mean for new gTLDs?

Remember, .CO is the country-code TLD for Colombia. Until this summer, you could only register names under .com.co, .net.co, etc. You couldn't register myname.co. Now anyone in the world can register a .co name, and register it directly under the top level. Remember also that as a country-code TLD, .CO was not constrained by ICANN rules, which means that they were able to (re-) launch their TLD relatively quickly. Even so, their rules and regulations closely hewed to the latest ICANN rules, especially in regard to cybersquatting.

The response to the .CO launch was tremendous. Let's review:

  • 11,000 names applied for during the Sunrise Period
  • 28,000 names sold during the Landrush Period (closed July 15, 2010)
  • Total paid by applicants for Sunrise and Landrush names: over $10 million
  • Total .co names registered as of this writing: 440,000

What do these numbers mean for prospective new gTLDs? Obviously, they prove that there are lots of buyers out there if the value proposition is good, and that's a very good sign. There is no indication (quite the opposite, in fact) that people have anything against new TLDs. Quite the opposite, in fact: if it's a good one, they'll flock to it in droves.

But .CO is somewhat of a special case. There are a few things to keep in mind:

First, although cybersquatting of brand names was dealt with aggressively by the talented .CO team, we have to assume that many of the registrations were done in hopes of getting traffic from people who forgot to add the "m" to a .com URL. No new gTLDs will be able to benefit from similar fat-fingered mistakes, because ICANN is running a "similarity test" to make sure that there aren't such confusions. We won't know how much typo traffic there actually is until it comes time to renew the names. Then, speculative traffic names will either be renewed (if they received typo traffic) or will be dropped (if they didn't). So keep an eye on next July for interesting stats.

Second, the .CO team is really good, and did everything right. They hired smart veterans and spent a fair amount of time and money making sure that brand owners and registrars knew what was happening, what the rules were, how and when to apply, etc. This had the virtuous double effect of almost completely eliminating complaints about the process and also maximizing registrations. New TLD applicants, take note.

Third, .CO had the field to itself. When new gTLDs start launching, it will probably be on a rolling schedule, but nonetheless there is likely to be more than one launch at any given time.

These are the factors giving .CO an edge, but this doesn't mean that new gTLDs won't be able to duplicate or surpass their success. Many of these considerations are double-edged swords. The fact that .CO is a misspelling of .COM also means that fewer real sites will get built, fewer names will be renewed, and cybersquatting problems will be relatively larger than in most new gTLDs. The fact that .CO spent a lot of money means that their profit margin is lower.

Every new TLD launch will have specific considerations and circumstances that will both help and hinder its growth. Several new gTLDs, especially geographical names and communities, will have natural constituencies that will fuel registrations. Others will have worldwide appeal. Many will not measure their success in registrations, but instead on service to their communities.

Overall, the .CO launch should make prospective new gTLD applicants very happy indeed. It is a great proof of the market, and it shows (once again) that intelligent branding and marketing will go a long way to making a project a success.

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Great post. I thought .co's timing was Jacob Williams  –  Sep 08, 2010 6:57 PM PDT

Great post. I thought .co's timing was impeccable. Marketing dollars were well spent and now I even want a flying pig! I will be interesting to see the renewal rate.

Nice post Antony!In regards to .co, the Constantine Roussos  –  Sep 08, 2010 9:18 PM PDT

Nice post Antony!

In regards to .co, the best example to illustrate that the time is ripe for new TLDs is its usage by Twitter. The .co registry gave t.co to Twitter to be used as a URL shortener. The short domain name performs a function which is easily recognizable and useful. With 140 characters or less to Tweet, the URL shortener length is important. T.co is as minimal as it can get for Twitter. That means maximum value to its members where less URL shortener characters means more real estate to write.

In the same manner that .co worked for Twitter as the best fit for a URL shortener , new TLDs will work to best represent entities and be the best fit for their function. New TLD success will not be determined by domainer investments though. It will be about how they add value to Internet users and the ones they represent.

Also I was glad to see that .co handled the cybersquatting fears effectively. I am sure brand holders and the trademark community is taking notes and taking comfort in this. I believed .co would be a brand owners nightmare and worst case scenario for cybersquatting as well as typosquatting especially if brand owners held the .com equivalent. This is surely the most positive thing I took out of .co for new TLDs since trademark protection has been such a hot topic at ICANN.

Constantine Roussos
.music

Thanks Constantine. Of course, since no-one Antony Van Couvering  –  Sep 08, 2010 9:23 PM PDT

Thanks Constantine.  Of course, since no-one uses their phone to either tweet or read tweets, Twitter could just change the limit to 150 or 160 or even 200 characters (!) and use whatever URL they wanted....  But I take your point.

I agree that the .CO team did a magnificent job with cybersquatting.  Despite some grumbling from the usual grumblers, it came off without a hitch.

Hey Antony,The numbers out of Twitter last Constantine Roussos  –  Sep 09, 2010 2:56 AM PDT

Hey Antony,

The numbers out of Twitter last week were interesting: 16 percent of all NEW users to Twitter start on mobile. I know I Tweet alot on a mobile device and most bands do as well. Expect that number to rise with bigger penetration of smart phones globally.

Twitter certainly takes pride in the 140 characters they took into consideration. If that changes, then URL shortener domain names will be impacted. For example, tinyURL.com, one of the first to shorten might become relevant again. Again it is all case by case. But, the point of T.co was that Twitter did not care about the .com extension.

I presented Twitter as a classic example of adoption by users because of the revolution is caused in regards to domain hacking. Take bit.ly, aw.sm, tr.im or even Facebook's fb.me for example. People became comfortable clicking on links with extensions that served a semantic meaning. New TLDs will have the same effect.

Constantine Roussos
.music

AntonyThat's not true. A LOT of people, Michele Neylon  –  Sep 10, 2010 2:25 PM PDT

Antony

That's not true. A LOT of people, including me, tweet via SMS.

Regards

Michele

Good post Antony. Maybe .CO's success does Christopher Parente  –  Sep 09, 2010 7:47 PM PDT

Good post Antony. Maybe .CO's success does bode well for gTLDs.

To put the growth in perspective, the entire global domain market only grew by one million names in Q1, according to VeriSign's latest numbers. So if .co had launched in January rather than June, it would have represented almost 50% of all registrations in the world.

Pretty heady stuff. Maybe there will be an appetite for some new gTLDs. The ones applicants actually plan to use of course — not bury so no one else can.

The $64,000 question: how much of the Katya Nováková  –  Sep 14, 2010 12:21 PM PDT

The $64,000 question: how much of the registration volume is not strictly speculative or defensive ?

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