Why does TLD pricing vary?

A Top Level Domain (TLD) is the last part of a domain name, such as .com, .net, .edu.  Very recently, many new TLDs have become available, including options such as .design, .basketball, .ink and .dentist.  Each TLD is run by a company called a “registry” and with all the new TLDs there are lots of new registries.  Registries are allowed to set pricing for names sold within their TLD and thus, there is now a wide variety of pricing.  Below is an explanation of some of the different pricing strategies:

  • Traditional Pricing – .com, .net and many of the TLDs that have been around for a while have wholesale pricing that is around $8.  So, .com names typically sell for around $10 – $15 depending upon the registrar you go to.  Registrars (companies that sell names to the public, like Porkbun.com!) generally assign a markup to the names they sell – and we only mark up $1 + card processing fees!
  • Niche Pricing – many of the new TLDs are aimed at a particular “niche.” As they have a smaller audience for those names, they often select a higher wholesale price.  For example, a .plumbing site carries a $20 wholesale price, .energy $66, and .luxury $400!  All of these prices are for 1 year of registration and must be paid annually to retain the domain.
  • Super Low Pricing – some registry operators either give their names away or sell them at very low prices such as $.50 or $1 in the first year.  This strategy allows them to amass a lot of new registrations quickly.  The downside is that registrants may not value the names and may not renew in future years.

 

Then, some domain names are inherently better than others. AndrewSmith.design is unique enough that it is not “premium,” whereas Smith.design is a short, brandable domain name that millions of people with the last name “Smith” could be interested in! So, registries have taken 2 tracks to address this:

  • Traditional Premium Pricing – when new registries first go to market, they often withhold a set of more valuable names and assign one-time premium prices to those names.  For example, a name like black.ink might sell for $20,000 in the first year and then renew at normal pricing of $19 / year in future years.
  • Premium Renewal Pricing – the best names will simply renew at a higher price every year.  For example, a normal .love registration is $20 / year wholesale, but puppy.love might go for $10K / year.

It is confusing, especially when presented with a long list of different TLDs with wildly different prices.  But I hope this helps shine some light on how new domain companies are assigning prices –  please feel free to ask more questions and I’ll do my best to answer them here!

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