When the Internet really started to grow in the 90’s, people didn’t know much about how websites worked, but they knew one thing – that they started with www. and ended with .com.
For many people this was what websites were. This was reflected in the name it was given in the media when it reported on its amazing growth and move into peoples homes – it was not called the Internet boom, it was called the dot-com boom.
Domain (Internet) - nounA distinct subset of the Internet with addresses sharing a common suffix or under the control of a particular organization or individual. For example .com, .net . co.uk and .org.
The .com Boom and Bust
The dot-com domain is so well known because very early on, lots of people (including marketing executives) saw a very great opportunity to capitalise on this new form of technology. Companies spent vast amounts competing to get customers to their website, offering free or heavily discounted products and services on their website. These companies were completely convinced that this new strategy of grabbing hold of a new customer base would translate, in the long run, into huge profits.
Pretty quickly having a .com domain seemed to take on a new status – owning a .com domain meant a business was serious – and investors believed it had become a sign of solidity and future success. Having a dot-com now meant you were a success in the future.
This actively led to many large organisations with a dot-com domain going completely wild in their spending with some dishing out over $2 Million for a 30 second Superbowl commercial, throwing huge dot-com parties to celebrate their website launches and even offering employees extravagant dot-com holidays. Their culture rapidly became one of “growth over profits”, believing that suddenly they had access to a brand new global market – hundreds of times larger than before.
Dot-com Companies were sold via IPO for Millions of Dollars without ever making a profit. This, twinned with low interest rates and high availability of cash for companies to continue buying advertising, led to the dot-com bubble and the following Stock Market crash.
By November 7th, 2000, dot-com Internet stocks had declined in value by 75%, and this trend went on to wipe over $5 Trillion off the Stock Market following the Enron, Worldcom and Adelphia Communications Corporation scandals in July 2002. It seemed that the advantages of the Internet, in its current form, had been wildly overestimated and that the market was simply not ready.
.com … Still going strong
Despite its rather crazy past, many companies around the world still use a dot-com domain because they consider it to say something impressive about the business – they still believe the original idea which was sold to companies – that serious companies use a serious domain.
In total, 46.5% of websites currently use .com as their top level domain name. It should be considered, however, that approximately 75% of dot-com websites registered are not active but are just parked domains. This means the domain name has been purchased to be sold rather than used. This followed a trend in the 2000’s that a short tail domains (ie. one word domains) could be sold to large businesses for millions of dollars.
The Top 5 Most Expensive Domain Purchases
1. Insurance.com – $35.6 M – 2010
2. VacationRentals.com – $35m – 2007
3. PrivateJet.com – $30.18m – 2012
4. Internet.com – $18m – 2009
5. 360.com – $17m – 2015
Over the years the number of domain names has expanded far beyond dot-com domains, with new registrars introducing different domains for different regions. As a rule, today it tends to be that companies which trade internationally or within the borders of the US favour the .com domain wheras counties which trade nationally choose a domain suited to their region.
There were approximately 332.4 Million domains registered at the end of 2017, representing a growth of 2.9% year on year. The total domain registrations are broken up as below:
The one factor which has not yet been covered is bureaucracy. Different countries have their own processes for domain names. Some charge thousands of dollars just to register and take months to change any details. China are notorious for adding blockers to purchasing the .cn domain name – only recently allowing foreigners to purchase them, at a price, and requiring a huge amount of information first. This is the main reason for the rise of the third most popular domain – .tk – which are a tiny island nation just off the coast of new Zealand. This domain was setup specifically to allow smaller Chinese businesses and people in developing nations to setup websites quickly, cheaply and bypass the red tape.
The Real Story – why you shouldn’t get a .com domain
While the general statistics seem to paint quite an attractive picture of .com domains, the truth is that more and more businesses are beginning to realise that it isn’t required and do not hold the value they once did. The fastest growing domains are the new domains which are released, especially if they are in an emerging market or situated in a location.
The benefit of going with one of these domains instead of a dot-com domain include:
- More freedom to get the name you want, at a cheaper price. Right now companies are rapidly purchasing popular .uk domains, but there are still vastly more of them available than .com domains. Expect to pay much less for a .co.uk or .uk domain.
- Better and cheaper systems in place to change or update domain settings when changing hosting provider. This means changes are typically FREE and INSTANT rather than costly and lengthy.
- Google ranking. While right now Google does not discriminate among TLD’s (Top Level Domains), it will certainly include this into it’s matrix in the future. Google is moving more towards location sensitive applications and data, meaning it will use location based domains more effectively in the future to give better results to users.