Domain changes coming – should startups take notice?

Startups need to sit up and take notice of big change to the domain name system coming around the corner or miss out potential new opportunities. That at least one of the messages coming out of a new report issued, predictably, by a domain name registrar. But hold on a second, do they have a point?

From next year The Internet Corporation for Assigned Names and Numbers (ICANN), the international body that oversees the structure of the Internet, will liberalise the market for domain name extensions – the .com or .uk part of a web address. This means that anyone, in theory, can apply to operate an extension. So instead of “DietCoke dot com”, Coke could set up diet.coke, zero.coke etc etc.

A new report carried out by The Future Laboratory on behalf of domain name registrar quizzed a survey of 1,000 Britons and 50 e-commerce managers from large high street businesses and 50 e-commerce managers from SMEs. It found that while two thirds of businesses were unaware that this change is taking place, over 80% thought, when told about it, that it would be a good idea in terms of branding, domain name control, things like that.

Here’s the interesting bit for startups: less dumb names like, and something more like

If you’re a well funded startup you could in theory set up a registry to reinforce your brand i.e. every microsite campaign would be punctuated with .yourbrand e.g. .myspace. There’s an argument here about controlling piracy and counterfeiting.

There may also be a startup play for new registries. There will be plenty of opportunities around .news, .film, .london, .restaurant, .football, .fashion etc.

But there’s the flexibility issue. zynga.facebook is a great for a while, but what happens if the business switches to iPhone apps?

Curiously while only 19% of those surveyed said an extension like .microsoft would be memorable only 24% think a .com domain is. What can we concur from that? A lot the time confused punters are probably just Google the domain because they can’t rememember the extension anyway.

The big problem of course is that cybersquatters register all the best domain names or use domain names that resemble trademarks for phishing or similar.

So given the complications and requirement to register even more domain names perhaps doesn’t look so bad after all?

There’s also another problem. Startups of the kind TechCrunch likes to talk about tend to end up as global plays. So getting .woohahoo might be handy, but it’s only useful if the average person gets used to the idea that .toyota is a normal domain name. Other than that we’re back to relying on search again.

And that change in mindset probably won’t happen for a long, long while, given it’s taken ten years for everyone to get used to .com and .net.