Letter domain names might be worth less than $1,000 — Yes, one

Supply and demand and fresh TLDs…what once was scarce is no longer.

Over the weekend there was quite a hubbub over at DomainInvesting.com regarding the availability of single letter domain names in fresh top level domain names.

In short: they are available, albeit at a premium annual registration fee. Although prices seemed to fluctuate over the weekend, it seems that the standard price is $400.

Since you have to pay this fee each year, the domains aren’t actually $400 compared to domains with lower annual renewal fees. But they’re cheap when compared to how much people have paid for single letter domains until now, even in alternative extensions such as .biz.

Here’s the reality: your single letter .biz domains are worth a lot less now than they were in 2009, when people paid close to $10k a pop for them. What was once a scarce resource is now relatively plentiful.

For each hundred fresh TLDs that come out, there are 2,600 single letter second level domains. There will be hundreds of fresh TLDs coming out, so a couple years from now there will be over 10,000 single letter domain names in open fresh TLDs.

There’s no way each of these will sell for around $10k like the .biz ones did.

Sure, some will sell for more, but most will sell for less (assuming registries allow them to.) If registries were to auction them all off, even staggered over two years, I’d expect the median price to be below $1,000.

Some single letter domains might be worth the $400 recurring charge Donuts is asking. Just remember: the supply keeps getting bigger.