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Chinese TLDs Gold Rush – What You Must Know Before Investing

Most of us feel that we have missed the domain gold rush of the late 1990s. I mean… if it had happened all over again, who would not know that buying up category defining domains will make them millionaires overnight.

The thing that is eating at us is that during those years, we might have not sat on the side lines if we actually had access to the internet. This is why the big time domainers were in exactly the right place at the right time to take advantage of collecting a whole portfolio of great names. And of course, let’s not leave out the fact that they had the vision and guts to take action on what they saw as the future.

If you don’t already know, the domain industry led by ICANN is changing internet as we know it by introducing hundreds of new top level domains (TLD) into the market slowly phase by phase. The public opinion has always been to question which new TLD can actually make it as big as the .com. But let’s not get into that. Because the introduction of Chinese character extensions has brought the second wave of domain gold mining onto the horizon.

If you had cursed to the heavens that you never really had to chance to compete for great domain names on a level playing feel, this is the closest you will get. I don’t think anyone needs to remind themselves of how big the China market is. And up until recently, they have been using the internet with English character URLs and domains. Now they have released their own Chinese character domains. I’m sure that if you are an opportunist, you are going to be buying them up like candies.

But before you do that, do you really know enough to dump your money into it?

Firstly, there are 2 main extensions that you have to consider. The Chinese government have bought up thousands of domains with the .在线 and .中文网. So the question now is which one will be the one that goes more mainstream than the other. Bearing in mind that Chinese domains will cost about $40 a pop, you will probably want to buy the right one rather than spend money on the one that don’t end up taking off.

Instinctively, we would probably think that .在线 will be the one as is shorter. But we can never say with certainty. It will be a nervy few months ahead as we look at more developments on what are the plans China has for their domains.

The second thing you must be consider is that are you buying the right words. I’m fortunate that my parents made me study Chinese as a second language in school. During those years, I have to admit that I felt a little stupid to study that. Now I know the value of that education. I have also been to China a few times.

The thing with the Chinese language is that it can be an orgy of word plays. A single words can have multiple meanings when combines with other words. Each word also has 4 different pronunciations. Each pronunciation have their own variety of uses and meanings. Is that enough to confuse you?

So if you are depending on Google translate to work out what names to buy, you might be stabbing yourself with a fork. You might then end up sitting on that domain for years wondering when that magic buyer will turn up and take it off you for a 6-figure sum. You best bet will be to get the advice of someone who actually understands the language.

The great thing that that we have observed how the domaining industry have played out over the years. So we might be able to use that knowledge and information to apply it on the Chinese market.

Which brings us to the third problem. Different words can be used to describe the same thing in Chinese. So do you know which are the terms that are used more casually or more formally? For example, the Chinese characters for “dating” can be subjective. When I put that into Google translate, it churns out a 2 character word. But regular people use another term that is different from what Google thinks. And that is not the end of it. Because there are at least 2 more common terms that describe dating!

To throw another wrench into the works, the 2-worded term for “dating” can also be represented with just 1 word without losing it’s meaning. So the question is – Are you really ready to buy Chinese?

You want more? Alright here is the forth reason. China has a very colourful history. The stories in itself are in folklore that children know with great interest. So big and complex are the population that many different states speak a different dialect. This means that the way they put words together can be different from one another. The way they pronounce the words are also different. The government is making an effort to address this by introducing simplified Chinese. But don’t be the least surprised to find that most people still do not speak common simplified Chinese very well and prefer to go with their dialects.

For example, Guangzhou is a state that speaks Cantonese like Hong Kong. Fujian speaks Hokkien like Taiwan. Want to make a guess of how many states and dialects are there?

Putting this into perspective, the challenge of picking our domain investments become even more complicated.

Another confusing issue for investors outside China is that we cannot put words together and just translate that into Chinese. If we are to translate “auto insurance” into Chinese, we end up with a word that is a literal translation. But the people in China does not call it that way. So there goes your portfolio.

One final thing I want to touch on is that trademark law in China can be very different than what we are accustomed to. Did you read up the news about Apple unable to enforce their trademark in China?

This can mean a big problem for western investors. But it can also bring huge opportunities. Because what if you can purchase the trademark of big international players in Chinese domains and not have to let it go? I’m of course, not encouraging you to do so. I’m just saying that that might happen.

If you don’t know, English trademarks are seldom literal translations in China. They are often words that have nothing to do with the English words. They have an audio resemblance instead.

All in all, the Chinese domains present a great opportunity for everyone. But just do your research before putting your money in.

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