Don’t Go It Alone
The cost of applying for and maintaining a TLD are not insignificant. The application fee to ICANN for a new top level domain is $185,000, and annual operating costs may run into the millions of dollars.
It makes sense for most cities to partner with a a registry services provider, on a revenue-sharing basis, in order to get necessary expertise and investment with lower risk. See our Guide to Selecting a City Top-Level Domain Registry Provider for advice on what to look for.
Application Costs
ICANN will charge $185,000 as an application fee. That amount may be divided into a $55,000 Pre-Application submission fee and a subsequent $130,000 application fee, or they may bundle it together.
If you hire a registry services provider or private consultant to help with your application, you may be charged upwards of $100,000. Other soft costs will bring the total application cost to near $500,000. Working with a registry services provider who is willing to invest in your city TLD may bring this down considerably.
Launch Costs
After the contract with ICANN is signed, the TLD needs to be launched. First, arrangements have to be made with the registrars, who handle all end-user customer interactions, as mandated by ICANN. Then, preparations for the pre-launch allocation periods begin. This usually starts with a period where trademarks and other intellectual property holders can claim their brand names on a priority basis (usually called the Sunrise Period), followed by another window where the initial crush is handled through what is called a Landrush Period. Not long after that, the TLD will go into a steady-state mode and normal operations will commence.
The costs of setting up contractual relationships with registrars, and marketing and operating the Sunrise and Landrush periods, is considerable, easily surpassing millions of dollars. In our view, getting the word out for the launch of a TLD is the most important marketing you can do, and presents a never-again marketing opportunity and challenge. A registry service provider with good marketing ability is crucial, possibly in conjunction with other city-led marketing efforts.
If this sounds expensive, it is. The good news is that, properly executed, the Sunrise and Landrush periods should bring in substantial revenue and repay the initial investment quite quickly.
