Major Porn Sites Sue ICANN Over .XXX
zdnet.com
zdnet.com
So who benefits from yahoo having to buy yahoo.com, yahoo.net, yahoo.org, etc, instead of buying one domain called "yahoo"? It all just seems like a price gouging scheme at this point.
I'm serious.
1: Without some sort of naming convention websites would be a string of numbers. This was what the one we ended up with, and we are all used to it now.
2: The TLDs provide the first port of call for looking up a url. Thus the .com DNS server needs to know al the .coms, but that is it. the 2LD servers likewise have to deal in their area only. That's a lot easier than storing and refreshing the entire authorized internet DNS lookup at all points. (I'm getting out of my depth here, but there is some pretty clever stuff going on these days)
3: As you say the TLDs provide basic 'segregation' and while .net and .com use cases seem to have merged, .gov, .mil and beyond that country ccTLDs such as .uk, .nz and .au are all performing important roles for now and for a long time going forward.
Meanwhile there are 7 billion people, and goodness knows how many businesses in the world, and many of them have similar names. Different TLDs and 2LDs give them a chance to coexist. Yahoo and other giant corporations are a bit different as they are truly global and need to buy up all domains, but most companies are not interested in every last TLD.
The money made from the gTLD and 2LDs goes towards supporting the DNS system, which is what makes the internet work, SOPA notwithstanding.
For the record, my client is happy to pay the large (compared to normal domain registrations) fee to keep their .xxx from resolving.
Why one TLD would cost more than the next one?
I'm not saying .xxx will have value, just that not all TLDs are made equally.