Late last night, the New York Post published an article about GoDaddy’s upcoming IPO, and the most interesting aspect of the article to me doesn’t really have to do with GoDaddy. According to the article, “Google has decided against making an aggressive push into the domain space, The Post has learned.”
I am sure this will come as good news for GoDaddy and other large domain registrars. I haven’t heard many people in this business publicly express concern about Google Domains, but I would assume many registrars had private fears that Google could potentially become a major competitor if it chose that path.
The New York Post’s source also mentioned that Google apparently does not have plans to enter the hosting or website development business. This is also good news for companies like GoDaddy who have been focusing on these add-on services to drive revenue. I think that this may be a key driver in a decision about a big move into the domain business.
Despite Google’s size and reach, I think there is at least one major barrier to becoming a major player in the domain name registrar business. Domain names are a low margin product, and many registrars make a good portion of their revenue by selling upgrades like web development and web hosting. It would seem strange that Google could offer web development services when the company is the leading search engine, and a major goal of good web development is top search engine rankings. Imagine buying web development services from Google and having a website that doesn’t have good search results. One would assume that if Google builds a website for a client, it should rank well for relevant searches. That doesn’t seem like a promise that could be kept.
A secondary issue is that web development and hosting tend to be a hands on service. People want to work closely with their service provider to make sure the website works well. This requires a large (and expensive) customer support staff. I presume Google has the resources to build a large staff, but I don’t know if the company wants to do this.
The New York Post article is interesting, but the information shared is not an official Google position. In fact, a Google spokesperson declined to comment for the article. I am sure domain registrars will continue to monitor Google Domains developments.