Guest post by Mihaela Lica Butler
With the June ICANN announcement that the gTLDs spectrum will be enriched with .brands, it became obvious that the Internet, as we know it, will soon change, and the war for relevant online real estate is afoot. Verisign predicted 1,500+ New gTLD applications for the first window , between 12 January 2012 – 12 April 2012; but ICANN will only select 500 of them all – who will be the lucky few?
Considering the it costs $185,000 to apply for a new gTLD extension and an additional $25,000 per year to keep it active, it’s easy to assume that the lucky few will also be the powerful few, namely, those companies that understand the branding value of such domain extensions, and in the end, the PR value. PR because a branded domain is a more reliable source for the customer, and also because brand value is a part of an integrated PR strategy, after all.
Many believe that ICANN’s near $200,000 price is too high, but the long term picture seems more than rewarding. A branded domain is a stronger domain, possibly ranking higher in search, particularly in Google – as the search engine giant is already giving priority placement to relevant brands. For instance, Hilton already ranks at the top for their own brand, and for Hilton hotel deals. But there are also other travel sites selling Hilton hotel deals – and for the traveler who wants to book a room with Hilton, the latest may not be as reliable. Only the original Hilton site offers the “trust” factor, but sometimes, finding these deals on the site is not the easiest thing to do. If Hilton would structure its offerings to something highly relevant, the users, and the company, can only benefit. A .brand gTLD could be used for this purpose, and the new URL could be www.deals.hilton.
The branding benefit is here obvious: no one else, but Hilton, the trademark owner, can register this gTLD – so the brand is safe from cybersquatting, brand jacking and so on.
On another side, the .brand gTLDs open possibilities for those who want to deal with online real estate. Imagine someone buying .travel gTLD. They could be selling any domain with this extension. From france.travel, to luxury.travel and so on. There’s SEO strength in these domains, given their highly targeted keywords, and with the right content, these sites may soon supersede more established, older domains.
Then, considering the costs of registering and keeping active these domains, as well as the scrutiny involved in accepting applications by ICANN, there will be no bogus companies running them. But then, smaller businesses, that cannot afford the prices, will face hard-to beat competitors, and they’ll have to resort to other tools to keep up – namely more online PR campaigns to drive traffic to traditional domains.
In some countries, there are solutions for businesses to recoup their initial $185,000 investment. For instance, in the Grand Duchy of Luxembourg, businesses can benefit of 80% tax exemption derived from income generate by these domains, according to VAYTON Brand Capital. Here, IP friendly legislation provides the same tax advantage for other IP assets such as trademarks, patents, registered designs as well as copyright on software. But only companies registered in Luxembourg, companies that register their IP in Luxembourg, or companies whose IP assets are in use by a Luxembourg-based business can harvest the benefits.
For ICANN, the new gTLDs are more than PR: they mean business. Serious business, with significant revenue. The plan is to release 500 new gTLDs next year, then follow them with batches of 400. Assuming that they release 900 new gTLDs in 2012, they make $189 million revenue. Which begs the question: did they really do it out of care for brands and consumers, or was this a strategy to generate a quick buck… in this case a quick 189 million bucks.
And if this is the case, why do they cheapen on PR? For a PR campaign meant to promote the new gTLDs initiative, the ICANN will only fork over $750,000 – at least this is disclosed in a Request for Proposals issued by ICANN to provide advertising and promotion services for the launch of new generic top-level domains (new gTLDs) on July 5th 2011:
The objective of this RFP is to retain an advertising agency to develop, implement and measure the success of a global advertising and awareness campaign for ICANN to introduce new gTLDs. ICANN has a limited advertising budget of $750,000.
With or without an advertising/PR agency to manage the campaign, there’s been enough ink to raise awareness about the new gTLDs already. But the high costs of registering such gTLDs are still not justified for many business owners.
About the author
Mihaela Lica Butler is an experienced PR professional, senior partner and founder of Pamil Visions PR. She writes about the latest in the PR field at Everything PR and is a widely cited authority on search engine optimization and public relations issues (BBC News, Force for Good, Reuters, Al Jazeera and others). She also occasionally writes for SitePoint, Search Engine Journal, and other online publications. To stay in touch with her latest work, follow her on Twitter.