Small businesses are facing a big choice when it comes to their Web presence.
The Internet Corporation for Assigned Names and Numbers, or ICANN, is accepting applications for the chance to create and manage new top-level domains?the part of the Web address to the right of the dot, like ?com? and ?org.? People who manage websites will have the chance to acquire addresses at those new top-level domains, also known as TLDs.
![[DOMAINicon]](http://si.wsj.net/public/resources/images/BI-AA462_DOMAIN_DV_20120314143934.jpg)
The Wall Street Journal
Many Web veterans argue that the new addresses are a potential boon for small companies. Businesses will be able to get TLDs that better reflect their brand?perhaps ?.food? for restaurants or ?.realestate? for brokers?and let them do better marketing. There?s also the chance that the new TLDs may offer better security protections or even vet the sites that use the domain.
Critics, though, say the new addresses will cause confusion for customers and headaches for businesses. Marketing a new TLD will take precious money and time, they argue, and there isn?t a big demand for existing
niche TLDs to begin with.
Yes: More Choices Can Pay Off
By Kevin Wilson
Not investing in a new top-level domain is like pining for the good old days when your only telecom option was a black Ma Bell telephone, or you could watch only the three broadcast networks. The new TLDs will offer small companies a bounty of new choices and promise to deliver innovations that improve security and marketing online.
Let?s start with choice. Right now, there are more than 100 million ?.com? domain names. That means it?s likely that the ideal name for a small business is already taken. I know my name, www.kevinwilson.com, is already taken by a real-estate agent in Denver. I?m sure he?s a nice guy, but he?s not me.
As things stand, I have to come up with a ?.com? name that?s confusing for me and my customers, something like kwilson1437.com. With a new TLD, I can choose a name ideal for me and my customers without having to force something available to work?for instance, www.kevinwilson.cfo.
New Possibilities
These new, specific TLDs will also give small firms the chance to tell customers what they?re about. Think of how much more information a business is giving customers, both online and in printed materials, when its address ends in ?.travelagent? or ?.restaurant? instead of just ?.com.?
![[DOMAIN_Wilson]](http://si.wsj.net/public/resources/images/BI-AA446_DOMAIN_DV_20120314131752.jpg)
Kathy Wilson
KEVIN WILSON: ?The new TLDs will offer small companies a bounty of new choices and promise to deliver innovations that improve security and marketing online.?
The marketing possibilities will get even more interesting than that. Some companies that manage the new TLDs will likely limit access to certain types of websites. An address like ?.realestate,? for instance, might be open only to people whose broker license is up-to-date. That will be a boon for people like Kevin the real-estate agent in Denver, since the address immediately tells customers something crucial about his business.
If your TLD has those kinds of conditions attached, it also means you can put distance between your site and ones you don?t like. Don?t want porn near you? There won?t be any at site if the TLD operators vet businesses and remove ones that don?t meet their criteria. There is a good chance, in fact, that some TLDs will end up with the same exclusive appeal as an address on Rodeo Drive or Fifth Avenue.
On top of all that, some companies that manage the new TLDs are also likely to offer security features that cut down on the risk of things like phishing and denial-of-service attacks.
It?s Up to the Companies
Critics argue that all the new possibilities will cause confusion. What?s wrong with confusion? Having to choose one toothpaste is less confusing, but is it better? Of course, you can stick with what you have. You can still use black Ma Bell phones, drive Model T?s and watch one channel on TV. Others will use innovation to meet client needs more effectively.
Likewise, some companies will do a better job than others of making their investment pay off. Some businesses will pay a lot for marketing, infrastructure and overhead. Some will pay a little. The return on investment is a function of the business plan.
Critics also fret about marketers that try to get small companies to buy up a company name across a host of TLDs, such as ?mycompany.myniche,? ?mycompany.myindustry? and ?mycompany.mylocation.? The pressure to get anything of value causes pressure. If a small business learned that there was land suddenly available next door to its headquarters, wouldn?t that cause pressure? Small companies can choose to get their company name, or they can choose not to get it. It?s up to them.
Also, keep in mind that if their company name is trademarked or otherwise protected, ICANN can help prevent the name from being sold to others.
Finally, there?s the argument that small companies mostly aren?t using the narrower TLDs that already exist. But each TLD that is narrow and restricted still has registrants who register and renew year after year.
These new options will bring up new challenges. Small companies will have to find ways to use their new choices to their best advantage. But that?s an improvement over the absence of choice we face right now.
Mr. Wilson is a former chief financial officer of ICANN and co-founder of Wise Dots LLC. He can be reached at reports@wsj.com.
No: Confusion and High Costs
By Douglas J. Wood
![[DOMAIN_Wood]](http://si.wsj.net/public/resources/images/BI-AA454A_DOMAI_DV_20120314131855.jpg)
Reed Smith
DOUGLAS J. WOOD: ?Small businesses have not asked for more TLDs, and they would not benefit by acquiring them.?
Small-business owners work on slim margins. Every penny counts. That?s why investing in new top-level domains for company sites is a bad idea.
The cost of buying individual domains is not exorbitant in itself. Nor is the cost of switching over an existing site to a new TLD. But when a small business makes that change, it must couple the move with a marketing campaign letting customers know of the new address and why it means something of value to them.
The company has already spent time and money establishing the goodwill of the original site. Will the incremental returns on promoting the new site match the original investment? It?s very doubtful. More likely than not, consumers will simply be confused.
Bad Addresses
But isn?t part of the sales pitch for the new TLDs that they make marketing easier? That it?s simpler to reach the customers you want if you have ?.myniche? as part of your Web address instead of the generic ?.com??
The answer: We?ve tried this already. It doesn?t work.
There are already 22 narrowly focused dot-addresses around, and the majority are flops, including .coop, .aero, .travel, .jobs, .museum, .pro, .name and .tel. They?re virtually unused by businesses and unrecognized by consumers. Saying that thousands of new ones will fare any better is sheer speculation; it?s also sheer speculation to say that the flurry of new TLDs will bring about technical innovation.
And what happens if the outfit managing a TLD goes belly-up? A cash-strapped small business that has bought an address in that domain has to invest yet more money to reroute customers someplace new and tell them about the move.
Those who support the flood of new TLDs also argue that there?s a scarcity of addresses available for the familiar .com TLD. But are small-business owners abandoning the Internet because they can?t get the domain names they like? If anything, small businesses are relying more heavily on the Web than ever, whether or not they can get the exact .com name they want.
The Heat Is On
This leads to an unsavory part of TLD marketing. Small businesses have already been victimized by marketers trying to sell them loads of Web addresses?a process that will only intensify with the introduction of new TLDs.
Domain-name sellers insist buyers should fear losing customers to competitors or scammers trading off their brand name. For example, if a small business owns only mycompany.com, domain-name sellers constantly remind it that there?s nothing to prevent a competitor from buying mycompany.net or mycompany.org and rerouting customers to their sites.
While the small-business owner may be able to sue for trademark infringement or cybersquatting, that?s expensive. So it?s cheaper for the small business, according to domain-name sellers, to simply buy every available mycompany address. Just imagine the pressures small businesses will face with more than 1,000 TLDs out there.
For an idea of the costs involved, consider this example. I recently searched at a popular domain-name seller to find Web addresses for a company name I invented. Mycompanyname.net was available for $9.99. Very reasonable. Immediately under the offer, however, was a string of 10 other TLDs?mycompanyname dot something else?for an additional $67.91. The seller also listed .mx (Mexico) and .ag (Antigua and Barbuda) for $159.98.
In fact, if I bought everything on the list, it would cost $620.44, assuming I didn?t want premium setups with extra features; those would cost between $1,588 and $29,850. And that?s before additional costs to hide my private registration information from snoopers and other add-ons.
The bottom line is this: Small businesses have not asked for more TLDs, and they would not benefit by acquiring them.
Mr. Wood is a partner with Reed Smith LLP and general counsel for the Association of National Advertisers. He can be reached at reports@wsj.com.
Source: http://dapssav.org/should-small-businesses-get-new-top-level-domains
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