Why are some domain extensions or domain names costly?

It is a well-known fact that domain names have a great influence in taking your business to new heights. They are indicative of your business values, product propositions, and more. It is your first step toward building your brand online. It is important to select the right domain name to leave a lasting impression in the minds of your customers. Choosing a premium domain name with the right TLD like the .ae domain will help you get the right attention from the right audience.
Pricing of domains – some factors
As you would know when you opt for a domain name, like a specialized Top Level Domain (TLD) (buy .ae domain for example), then you would be able to garner the attention of customers with ease. But you would be surprised to know that the pricing of certain domain names and domain extensions might be in the higher range. This is due to the several factors involved in the process like restrictions, exclusivity, business costs, registry pricing, etc.
● Registry pricing
The domain extensions like a .ae domain have to be registered with the right registrar and this might involve a certain amount of fee. The registries hold the information of the businesses to whom the domain names and the respective extensions are allocated and it is valid for a certain period from 1-5 years. They have the entire list of domain extensions, TLDs, and domain names that can be used, and the registrars reserve them for a fee. The price a domain registrar charges the business for registering a domain extension when you buy uae domain or any domain is known as the registry price.
The fee charged by the registries for each of the domain extensions like an uae domain varies based on the extension and the amount is as decided by the registries. The fee is levied on the registrars and it is influenced by multiple factors like government regulations, organizations to which it is allotted for community-driven firms, costs of operational processes, etc.
● Exclusivity
Sometimes, the domain extensions are requested by certain organizations to be declared exclusive. This means the domain extension cannot be bought or registered by any other individual or organization. It could be a TLD for a specific company or a group like .barclays or .bmw. It could also be a domain extension dedicated to a profession like .doctor or .lawyer, etc. Most of the time, bigger companies prefer to have a unique TLD to make their brand exclusive on the market.
Similarly, you will find country-specific domains like the .ae domain, .ca domain, etc. It is to be noted that the country code TLDs are not exclusive, especially since you can buy a .ae domain whether or not you have a business presence in the UAE.
If you are looking to have an exclusive domain for your organization or profession, then the cost of the domain extension will be slightly higher than when you buy generic domains or non-exclusive domains.
● Currency fluctuation
Another factor to consider is the country of origin of the domain extension or domain name. The domains are registered and bought from any country in their local currency. For instance, when you register for a .ae domain, you would be doing so in the currency of UAE (Dhirams). In such cases, if your country is not the same as the domain country, then there is a possible currency fluctuation which can result in an increase or fall in prices.
● Restricted zones and support processes
As per aeDA, there are certain restricted zone 2LDs such as net.ae, sch.ae, mil.ae, gov.ae, etc., and the license to buy a domain name in these restricted zones is generally not approved. For such cases, the registration has to be carried out by accredited registrars based out of UAE, as approved by aeDA, based on certain eligibility conditions. The cost for these TLDs, 2LDs, and 3LDs will also vary depending on the option chosen.
There are also additional requirements for some registrations, like for the 2LDs and 3LDs stated above, that might require additional support from the registrar. If the registry is not automated, then it might incur more time and cost to register your favored domain name and extension like a .ae domain. There will be additional costs to be added to your annual charge on domain registration when you buy country-code-specific TLDs like a .ae domain.
● Cost of renewal
Sometimes, a few domain names and extensions are offered on sale at a discount for you to pick up. However, when it comes to renewal, it will cost you the same amount as any fresh domain. This means you might be spending more on the renewal cost than you did on the cost of buying the domain.
Why choose the right domain name?
You might wonder whether it is right to spend money and get a domain name or TLD that reflects your business. You might want to consider a cheaper and generic option where the price is not a concern. But domain name what you need to remember is that when you choose a domain name or a domain extension, you are creating a brand identity for your business online.
The domain name or the domain extension like an ae domain tells the customer what you offer and where you offer at a single glance. This is why it is important to choose the right extension and domain name for your business. With a .ae domain, you can register even if you do not have a physical presence of your business in UAE, which is an added advantage to taking your business globally.
Furthermore, you can save more on your marketing as the brand identity is already deeply instilled with the right domain name and extension. Your domain name is your business identity online and it can generate more organic traffic than ever. It is the foundation on which you build your business online and it is, therefore, important to buy the right domain name and extension.

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