The Domain Name Industry — Threats to
Don’t get complacent; all is not well in the domain name industry.
What keeps you up at night? As a business owner, I have lots of worries. If you are sleeping comfortably at night, assuming everything in the domain industry is swell, you might be in for a rough 2008.
There are two main issues that keep me up at night.
First, I’m becoming more and more concerned regarding hucksters and deep-pocketed corporations coming following average joe domainer. There are a lot of criminals in this industry, and other people that take shortcuts, which unfortunately casts a negative view on everyone. Enforcement doesn’t just hurt the bad guys, it can also hurt the good guys.
There’s a little something we can all do to help alleviate this concern. Our main (only?) voice as an industry is the Internet Commerce Association. If it weren’t for ICA, we wouldn’t have a voice at the current ICANN meetings in India. I know I can’t afford to fly to all ICANN meetings, but together we can send representatives. Join as a member. It’s only $295 for a basic membership, and the return on this is phenomenal. I chipped in the prior week, you ought to too.
Second, nearly all of the ad revenue in this industry is concentrated with two firms: Google (GOOG) and Yahoo (YHOO). This means they get all of the control and there’s little to keep them honest. One change in policy at these firms could have devastating and far reaching effects on the industry. I’ve experienced this ahead of when I saw income at Google Adsense drop from $1,000 per day to a couple hundred a day, and now worse. There’s no recourse and no viable competitor lining up to work with you.
This is one of the reasons I don’t like the Yahoo-Microsoft (MSFT) buyout. Microsoft will (or ought to) enter the domain space soon, creating a third player in the space. The combination of the two firms would keep it at just two key competitors.
Do you think what’s in the best interest of domainers is in the best interest of Yahoo and Google? These two firms don’t necessarily think so. They care regarding long term profits and “user experience”. These firms can whether a short term storm. What would you do if your parking revenue took a major hit for two years? It would likely wipe you out. But it wouldn’t wipe these firms out.
By now we’ve seen one shoe drop. Reglike has learned through multiple sources that Ask.com’s Google feed will no longer be syndicated to parking firms as of March 1. A number of parking firms use this feed to augment other search results. I know that Parked.com uses it for traffic to some foreign firms, and apparently HitFarm and Skenzo use this feed as well. There are likely others. (Ask has not returned my calls for comment.)
Are other changes on the horizon? You bet. Buckle up.
