How NYC Is Turning the Value of Its Premium Brand into Digital Gold

May 10, 2017

4:00 pm

I want you to travel back in time with me twenty years or so.  The Internet is young and still relatively unknown to most of us.  Only a small group of web enthusiasts understand how to navigate it — let alone make a buck on it.  At this time, a handful of savvy prospectors have begun to take notice of the commercial potential behind this remarkable new technology.  Silently, they begin buying up domain names, also known as virtual real estate, that will soon dwarf the appreciation potential of any real estate investment in physical world.  

In a few short years, their early investments will pay off in a way that few could have ever imagined, as businesses around the world scramble for a presence in the greatest marketplace the world has ever seen. 

The .com Boom

Fast-forward to a few years later and take a look at some of the eye-popping numbers that buyers have paid to acquire some top .com domains:

  • sex.com  – $14 Million in 2005
  • fund.com – $10 Million in 2008
  • porn.com – $9.5 Million in 2007
  • fb.com – $8.5 Million in 2010
  • we.com – $8 Million in 2015

In fact, over the past two decades over a billion dollars of premium domain name deals have been reported and documented – with potentially billions more in stealth, under-the-radar sales that have gone unreported.

If someone had told you, back in the mid-nineties, that a simple “domain name” could fetch these outrageous prices, you would probably not have believed it.  Yet as incredible as these prices seem to the average person, to a business looking to be found amidst the clutter and confusion of today’s Internet – a short, meaningful, memorable domain name is well worth the premium price tag.

It has often been said that “domain names are the real estate of the Internet.” Just like physical real estate in the offline world, virtual real estate has a value that is directly related to variables like supply, demand and location.  After-all, a well-placed domain name can help businesses and brands to better connect and engage with consumers, garner coveted internet traffic — and stand out from the competition.

Until recently, .com was really the only game in town, and the scarcity of premium .com domains helped to justify the multi-million dollar price tags.  But the internet has come a long way in the last two decades – and thanks to a recent change in internet governance approved by ICANN (the Internet Corporation for Assigned Names and Numbers) – today there are over a thousand new dot anythings and dot everythings available for individuals, investors, businesses and brands to choose from.  

The Not-Com Revolution

In what has come to be known as the “not-com” revolution, over the past three years, close to 28 million domain names have been registered across 1200 “new” top-level domain extensions – including hobbies (e.g., .yoga, .baseball), professions (e.g., .law, .health), distinctions (.guru, .ninja) and cities (paris, .melbourne, .nyc) – among other things.  

More new top-level domains mean more options for individuals, businesses and brands to choose from – and less perceived scarcity. While the premium values of “new” domains have yet to come close to the stratospheric prices of .com domains during their heyday, make no mistake about it — there is value to be found if you know where to look.

Unfortunately, you can’t turn the clock back two decades to take advantage of the .com boom.  But the good news is that the internet is still just a baby.  If you pay close enough attention, there are still many opportunities to leverage today’s new domains to find and create value – and to build meaningful brands.

For example, here are just a few sales that demonstrate the premium values buyers have placed on certain new top-level domains names in the past couple of years.

  • casino.online – $201,250
  • video.games – $183,000
  • sex.live – $160,000
  • wine.club – $140,000
  • autism.rocks – $100,000

The .nyc Domain

Perched atop the most prime piece of physical real estate in the world, New York City is arguably the world’s most iconic city.

“The Big Apple.” “The Capital of the World.” “The Center of the Universe.” “The City that Never Sleeps.” Thanks in part to the strength and power of New York City’s brand, NYC is now well on the way toward creating one of the most valuable digital domains on the Internet.  

As part of its commitment to take the lead in digital innovation, 3 years ago, the City of New York launched the .nyc (pronounced dot-nyc) top-level domain, creating an official web address exclusively for the use of the people, businesses and brands of New York City.  Competing with legacy domains like .com, .net and .org, the .nyc domain gives New Yorkers the ability to connect and transact business through a shared location, and to showcase their affiliation with NYC as an enviable component of their success.

In addition to serving as a powerful city branding and public diplomacy tool, the .nyc domain provides individuals and businesses a branded space for expression and development — and a sense of community that unites New Yorkers as a force in the global internet. According to namestat.org, .nyc has become the largest domain extension of any city in the world – beating out other major global cities for the distinction, including .London, .Berlin, .Tokyo, and .Paris, to name just a few.

While most .nyc domain names sell for a retail price of +/-$25-$35, domain buyers have demonstrated that certain .nyc domain names have more intrinsic value than others.  In a series of open and transparent domain auctions, here are some of the premium values that New Yorkers have placed on select .nyc domain names during the past few years.

  • marijuana.nyc — $60,000
  • shop.nyc – $33,500
  • realestate.nyc – $21,300
  • townhouse.nyc – $21,000
  • kravmaga.nyc – $19,000
  • cosmeticdentistry.nyc – $16,600
  • apartments.nyc — $16,155
  • acupuncture.nyc – $15,500
  • dentalimplants.nyc – $15,000
  • physicaltherapy.nyc – $14,000

Domain names like these are considered premium for a variety of reasons, including factors like popularity in search, social trends, keyword value, brandability and category definition.  Premium domain names can help to drive consumer engagement, media attention, search engine traffic and sales – that’s why they are so valuable.

Right now, some of the highest value premium domains available in the .nyc namespace are up for auction. The auction, celebrating “Tech in the City,” is showcasing 26 of the most meaningful, memorable tech category names like, apps.nyc, startup.nyc, gaming.nyc, UX.nyc and more.  The auction also features names like VC.nyc and Angel.nyc, for the benefit of the investors who have helped to fuel the City’s tech growth.

The .nyc tech domain auction is taking place online from now through May 18th, 2017.  You can get all the details at www.auctions.nyc.

As New York City’s digital landscape continues to evolve, the ones to benefit are those first to the game. If you want a chance to own a part of NYC digital history, be sure to check out the full list of premium domains below and get your bids in before May 18th at http://www.auctions.nyc. Bidding starts at just $500 to ensure that this opportunity is accessible to all residents, students, entrepreneurs, and businesses.  

Just remember, .nyc is an exclusive benefit for New Yorkers – so only individuals and businesses in the five boroughs are eligible to participate. And hurry, or your chance to own one of these premium .nyc tech domains will be gone in a New York minute!

This article is brought to you by our partner Neustar, the domain registry that brings you .us, .co, .nyc, .biz, and top level domains.

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Lori Anne is Vice President of Registry Services, overseeing the business development, marketing, and communications initiatives for Neustar’s top-level domains (TLDs).

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