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Donuts’ EAP: cash cow or good invention?

blog-auctionIn one of our previous new gTLD newsletters we mentioned the Early Access Program (EAP) of Donuts. We received several questions and responses to it, and therefore we have dedicated this special blog to the EAP. On the one hand I will be giving you more information about this program and on the other hand I will be trying to answer the question whether it is purely an attempt to gain extra income or whether it really is a good invention.

The summary

The registry Donuts (with an expected 200-250 extensions) uses the same procedure for each extension: a Sunrise period of 60 days, a few days rest and then General Availability immediately following. There is no Landrush in which domains are sold in an auction.

To accommodate the domain holder without a trademark, Donuts has figured that the value of a domain name for someone who is seriously interested is higher than for a domain trader. That is the reason that the first seven days of every General Availability is furnished with the Early Access Program with daily decreasing prices.

Are you serious about a domain? Then register it on day 1! This will cost you about $10.000 extra, but how big is the chance that someone else will want to pay this too? The following year the renew prices will be at regular price.

Is your budget slightly smaller? On day 3 you will pay almost $1.000 extra and then the last days are ‘only’ $119.

From day 8 onwards the prices to be used for the domains are the regular prices and this is also the moment in which our pre-registered applications will be sent in.

To complete the picture: these are the EAP supplements per day (in addition to the regular domain price). The prices are the same in all tiers.

Prices of Early Access Program

[pricing_table] [pricing_column title=”Day”] [pricing_row]Day 1[/pricing_row] [pricing_row]Day 2[/pricing_row] [pricing_row]Day 3[/pricing_row] [pricing_row]Day 4[/pricing_row] [pricing_row]Day 5[/pricing_row] [/pricing_column] [pricing_column title=”Price”] [pricing_row]USD 10.499[/pricing_row] [pricing_row]USD 2.599[/pricing_row] [pricing_row]USD 999[/pricing_row] [pricing_row]USD 549[/pricing_row] [pricing_row]USD 119[/pricing_row] [/pricing_column] [/pricing_table]

Example

For example: for our own business we want to use domains.support (hypothetically speaking, as this domain has been blocked). Supposing that we are in tier 3 then the regular price for a .support domain is $20.

Problem: we do not have a trademark registration for domains. Therefore we cannot participate in the Sunrise period. We suspect that several other companies will also prey on the domain name and want to be there before them.

The first chance we have is day 1 in the EAP, but then again $10.499 is a lot of money. Day 2 will cost us $2.599 extra and that is an amount we find reasonable to pay. The application will be done on day 2 and if all goes well we will have paid $2.619 for domain.support ($2.599 plus the regular price of $20). The following year the renewal price will be $20.

It may not all go according to plan: for example if GoDaddy also wants to apply fordomains.support. The amount of $10,499 is a pittance for a company of that size and if they have applied for it on day 1 then all our intended plans will end up with “This domain is not available”.

Scare tactics?

Is this scaremongering? Well, a little bit of course. If you have pre-registered a domain there is a chance that someone else may be there before you. Fordomains.support the risk will be higher than for openprovider.support.

Like everywhere else where there is a limited edition (for each domain there is only one) there will be a response to the gut feeling “what if…”. The product (that specific domain) is scarce and therefore there will be some people who are prepared to pay more for it. Realistic or not – you will shoot yourself in the foot when your idea of becoming a millionaire with domains.support gets torpedoed by someone with a bigger bag of money.

Chances are you will be applying a day earlier than you expected to because of the gut feeling “what if…”.

Cash cow?

The question asked in the introduction of whether this is just an attempt to gain extra income: I say “no”. It is undeniably a way for the registry to make money, but is a Landrush with its higher registration fee, non-refundable administration fee and selling duplicate applications by means of an auction not the same? And then there are even registries that not only ask an extra high price the first year, but year after year.

The $10.499 for day 1 is definitely a lot of money, but is $999 for day 3 worth it? You can buy a piece of security and that security comes at a price.

Let us look at it from the resellers point of view and be honest: wouldn’t you like to sell a product for once with more margin than a few pennies?

Or is it a good invention?

Obviously everyone has his own opinion on this, but I believe that the early Access Program is a fair way to quickly (by deleting the Landrush) bring a domain onto the market whilst giving the seriously interested parties the opportunity to register their domains with priority.

What do you think of this fact? Let me know at blog@openprovider.nl!

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