Happy New Year!  For a New gTLD, there is a substantial domain registration penalty for each character beyond three letters.  Today we are going to look at the relationship between how many characters are in a new gTLD string vs the total number of domains under management.  Prior to ICANN’s 2012 New gTLD Round 1, most TLDs were either two characters (ccTLDs) or three characters (.com, .net, .org, .edu, .gov, .xxx, .biz as examples).  ICANN’s prior name expansion efforts did introduce longer gTLDs such as .coop, .info, .travel, .museum, .info, .aero and others.  You can find a full list of all TLDs at dnib.com.

Let’s look at what the ntldstats.com data tells us about the relationship between length of a new gTLD string and volume of domains registered. 

The Top 10 three-character new gTLDs have an average of 1.1M domains being led by .xyz with 3.7M.  The Top 10 four-character new gTLDs have an average of 0.79M domains and led by .shop with 2.5M domains.  The simple addition of one character (from 3 to 4) introduces on average a 31% penalty in domain volume.  There is another similar 1-character penalty of 35% going from 4 to 5 characters with the average 0.38M domains for the Top 10 and being led by .store with 1.6M domains. 

The 6-character new gTLDs slightly disrupts the 1-character penalty pattern with a slight bump of 0.5% to 0.39M domains.  The reason for this anomaly due to the .online 6-character TLD which is the exception at 3.3M domains.  Looking at the line graph below which depicts the 1-character penalty curve, .online is the exception to the pattern and has 3.3M domains whereas the 1-character penalty pattern would predict only .95M domains for .online.  RADIX has successfully erased the 3-character penalty for .online.

The penalty pattern returns for 7-character TLDs with .website and most volume dropping to 0.32M domains corresponding to 26% penalty over 6-character domains. The Top 10, 7-character gTLDs averaged 91K domains.  By seven-characters, the maximum and average domain volumes have been reduced 91% and 92% respectively from the 3-character TLD data.  The average 8 and 9-character Top 10 domain averages fall off to 26K each.  By this time, the average has fallen 98% of the initial 3-character TLD average.  Similarly, the leading volume TLDs in these groups are .services with 78K and .solutions with 108K or just 2% and 3% of .xyz’s domain volume. 

The data indicates that there are severe domain volume penalties of -31% and -35% for moving off a 3-character TLD to a 4-character and 5-character TLD respectively.   reduction in domain volumes for every character that is added to a TLD string. 

Note: This data has not been normalized for pricing, discounts or other promotional behaviors. 

However, the data does raise the question of whether a “poor” three-letter TLD is a better investment than a “recognizable” 5 or 6 letter TLD.  At a $7 wholesale price, the average annual registry revenue penalty for 1-character more is assuming full wholesale revenue per name:

The 1-char penalty could be over $2M per year in lost registration revenue at $7 wholesale. There are 17,576 possible three letter combinations for our 26-letter alphabet (26x26x26).  As of today ICANN has approved 205 new gTLD along with the prior .com, .net, .org, .edu, .gov, .mil, .biz, .xxx there are 213 three-character TLDs.  That is 1.2% of the possible three-letter combinations.

Consider the possibility that a three-letter acronym, abbreviation or contraction of your longer character string could be a much better investment in Round 2 if branded well.   Happy hunting.

The table below lists all seventy (70) TLDs which comprise the ntldstats.com dataset.    I look forward to your observations and feedback on this analysis.