Phil commented on my last post and raised the issue of future risks to geo-domaining. I thought it was interesting and so here are my thoughts. I am interested to hear other people’s thoughts about the future threats to geo-domaining.
Renaming of cities
Probably a more obvious risk but one which depends on which part of the world you are investing in.
Major cities in India have been renamed after independence and these include Kanpur (formerly Cawnpore), Thiruvananthapuram (formerly Trivandrum), Mumbai (formerly Bombay), Chennai (formerly Madras), Kolkata (formerly Calcutta), Pune (formerly Poona) and Bengaluru (formerly Bangalore).
It also happens pretty often in the U.S. where towns can vote to change their name. In the recent election in New Jersey, the town of West Patterson voted in a referendum to change its name to Woodland Park. The referendum marked the fourth time the residents had attempted to change the borough’s name. Similar efforts led to East Paterson being renamed Elmwood Park in 1972.
In a strange twist on renaming towns, during the dot-com boom of 2000, Halfway, Ore. agreed to become Half.com for one year. In 2005, officials in the northern Idaho town of Santa, Idaho, on Monday voted to rename the 115-person hamlet SecretSanta.com, a service which manages gift exchanges for families and office workplaces online. Clark, Texas, morphed into DISH, Texas also that year.
Instability
War, political instability, revolution and declarations of independence can lead to countries or regions being renamed. For example fifteen new countries became independent with the dissolution of the USSR in 1991. Most of these countries declared independence a few months preceding the fall of the Soviet Union in late 1991.
Changing demographics
Regions and towns are dynamic communities and while this can lead to opportunities as I pointed out in my last post, it can also devalue a geo-domain when the demographics change. A rise in lower income families, urban decay, crime rates and unemployment can drastically change a region and turn a potentially valuable geo-domain into a burden.
Towns or cities dependent on a major tourist attraction or business type are particularly vulnerable. What would Orlando, Florida be like without Disney?
In the early 90s, British Coal closed 31 of its 50 mines and laid 30,000 miners, nearly three-quarters of the industry’s dwindling work force. In the Rhondda Valley of south Wales, for example, where as many as 250,000 men used to work in 70 pits, this decision left a single mine, employing just 370 workers.
What if Bush had decided not to rescue the American auto industry? What geo-domains might have been affected?
Geo-domains are probably more vulnerable to macro economics because the profit is often coming from industries sensitive to the general economic climate. Restaurants, hotels and other tourist related industries are good examples.
In summary
While this post looks at the risks of geo-domains, I do think there is value in carefully selected domains and especially with development, they can bring a nice return on investment.
I am sure I probably missed some other risks to geo-domains, so if you think of any more, please let me know. Remember I am referring to geo-domains in particular and not domains in general.
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I don’t know how much of a risk this will be
going forward but some time ago China changed
the way the language was officially romanized.
For example:
Previous——Current
Peking——–Beijing
Kung Fu——-Gung Fu
Canton——–Guangdong
Chi Kung——Qi Gung
However the older romanized words are still
very relevant.
Exactly, Patrick. Its similar to the Indian example I gave. Yugoslavia’s breakup and regime changes in Africa are other examples I didn’t mention.
is Thiruvananthapuram.com a Premium Domain?
Namer, it depends on how you define a premium domain. I haven’t done research on this name but hopefully you have looked at per capita income, alternative names, percent population online, tourism and so on.
Geo-domains need development to really be valuable. A very long name like this is less attractive even if it is the official name.
I dont see a risk on Geo domains as long as you do your homework.
Its the same with any other domain investment – Why buy or register a domain without looking at the market and doing some research.
Geo Domains are big business and shall remain big business for the years to come – Safe in my eyes.
Regards,
Robbie
I agree with Robbie on this. Geos are like any other name – Research, research, research. Before buying any name of reasonable quality you must have done your due diligence. Obviously nothing is a sure thing – but it does help to minimise the risks.
A geo domain might infringe the city trademark at this time, or at some time in the future in the law changes. This appears to be a higher risk for international than US cities at this time.
the puertorico.com case:
http://www.wipo.int/amc/en/domains/decisions/html/2002/d2002-1129.html
the Barcelona.com case:
http://www.icannwatch.org/article.pl?sid=03/06/03/0056220
the mexico.com case:
http://www.heydary.com/publications/domain-name-lawyer.html
Similar challenges have been launched against US geo cities too.
I would never buy something like korea.com.
Robbie, Agree that they will remain a good business but I disagree that there is no risk. How could you research or predict that a town will change its name?
I do agree that if you do the research then you will minimize the risk and that was the point of the post. If we can identify the risks to geo-domains, we can try to take steps to avoid them.
Interesting point, Phil.
One of the more common risks is the dilution not only from a multitude of growing tld’s, but how about multiple cities, i.e., Portland, Aurora & Portland?
Then add to the mix what are city and state combinations such as ProvoUtah.com as opposed to Provo.com (I don’t know anything about either, just using those names as an example).
The bottom line appears to be that having a one name geo-domain is a decided plus, but development will be helpful to maintain the edge.
Just my humble opinion, which when added to $3.50 will buy you cup of Starbucks coffee.
Correction: make that Portland, Aurora and Salem, as in:
Portland, Oregon and Portland, Maine.
Aurora, Colorado and plenty of other Aurora’s,
along with
Salem, Massachusetts and Salem, Oregon.
One name geos are definitely the most desirable. Good point about the repetitive names being used. A lot of town names are repeated as well. So knowing which names are used by the locals and which names are well known and used is important. For New York City, you could also have Big Apple or NYC. Many ways to skin the cat
Another risk or problem is the spelling in different languages. For example the Italian city of Venice (english spelling), Venezia (Italian spelling), Venetië (Dutch spelling), Venedig (German spelling), Venecia (Spanish spelling), Venise (French spelling).
As the old song goes,
Its Istanbul not Constantinople…