Editorial : Tough road ahead for domain investors

In June, I promised to post an editorial on the first of each month; life is what happens while one is busy making plans, so two days late it is.

Bad news: The road ahead for domain investors is far from covered with rose petals, and I’ll explain why.

Many newcomers to the domain industry join in, convinced that there’s money to be made in every direction, with very little research and effort.

Not sure where the perception of a modern Gold Rush comes from, but it’s all about one’s definition of “gold” that matters.

Domain forums are bustling with activity, and if it’s not about Chinese “premiums” it’s all about the latest “generic” gTLD.

But there is no coherent plan in this bazaar of sorts, and I’ve seen many a forum signature contain remarkably low quality domains. Rick Schwartz would not have been so nice with his choice of words, opting for “pigeon shit” instead.

The truth is, many domainer newbies don’t want to listen, and lack in focus and patience. There are now more than 1,000 new gTLDs and thus one thousand plus times the namespace it once existed only in .com. Excitement about domain investing is often unconstrained, and lacking research.

Such mistakes that fail to establish the element of research can be costly, as in the case of a pending lawsuit involving aftermarket domains that were allegedly taken away with a court order that was subsequently challenged. The new owners are facing lawsuits on top of having these domains taken away.

Elsewhere, the registrant of the trademarked name of a major games producer in the .Game gTLD, acknowledged their stupidity later, at the cost of $350 dollars. He won’t be renewing.

Even seasoned domainers are not immune from making careless decisions.

There are plenty of stolen domains going around at certain venues and marketplaces, and old school investors are often caught on the receiving end of these “suppliers” of stolen domain assets, repeatedly. Is it ignorance, or greed that drives these surefire deals, I’m not sure what to believe.

Meanwhile, ignorance about trademarks has led even those who otherwise respect Rick Schwartz’s contribution to the domain industry, to mock his rightful defense of the “Domain King” trademark.

Apparently, when a man who many times stood up against reverse domain name hijackers has a valid reason to defend his own brand, he’s stigmatized by some as an aggressor without rights.

Those who typically make such statements aren’t signing their statements and comments using their names or brands, naturally.

In the name of “free speech,” trolling is abundant on domain blogs, sometimes uncontrollably so.

There is so much white noise in these discussions, that any substance delivered by the posts is quickly lost among the theatrics and F-bombs beneath the article; another indication of an industry with an incoherent present and a cloudy future.

Companies that are industry leaders are often attacked, perhaps on the basis of an unfortunate treatment of customers. Domainers are not the most patient consumers, and many delve into domain investing as a side job; when these extra benefits change or disappear, they are quick to point the finger.

At the same time, companies eager to establish themselves in the new dawn of domain investing, branding and marketing, often pick questionable methods, such as spamming, to declare their availability.

Is there a single direction for the domain industry to evolve and mature, particularly since the introduction of a galaxy of new gTLDs?

The complexity of any market and industry, is defined by the quality of the professionals that form them. The domain industry is an amalgam of many distinct professions and is – unfortunately – unregulated.

Anyone can become a “domainer” and can attempt to make money by buying, selling, monetizing or building out domains. Anyone can also claim they can train others how to succeed in domain investing, often without a track record other than questionable credentials.

The healthy approach would be to proceed with reforming and regulating the domain industry, in a manner that’d ensure transparency, education, all while keeping a unified front against the challenges it faces. This approach would promote a healthy growth rate, and the eradication of numerous problems existing today within.

When domains are stolen and cannot be retrieved without a federal lawsuit and at a cost of thousands of dollars in legal fees, it’s evident that the current operational process that governs domains, as defined by ICANN, is severely flawed.

It’s a tough road ahead for domain investors, who need to evaluate whether it’s worth staying in this business, or if it’s best to diversify into real brick and mortar businesses that simply carry a domain name.

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