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A growing share of Americans are concerned about the environment, and the big U.S. tech companies would seem to be in a position to lead the way on fighting climate change.
Google is planning to invest $10 billion in India as part of plans to make the internet “affordable and useful” for a billion people.
The world’s biggest site for software developers is abandoning decades-old coding terms to remove references to slavery, such as master and slave.
Many companies are retreating. But Amazon, Apple, Facebook, Google and Microsoft are placing bets to get even bigger.
In this episode of Radio Corona, Gideon Lichfield, editor in chief of MIT Technology Review, will discuss the future of our connected world with Vint Cerf, one of the people known as a “father of the internet.”
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What happens when a Brand changes its company name, which has a .brand new gTLD, such as through a takeover, merger or just a name change? Thereâs currently no quick process in place to allow them to obtain a new gTLD to reflect the change. This is one of the many issues raised by LoÃ¯c Damilaville, Market Research Manager at Afnic who manages the French ccTLD as well as 17 new gTLDs, in todayâs Q&A looking at the year just gone and the year ahead.
Damilaville delves into many issues facing the industry including growth, or lack of growth, rates for top-level domains, the financial issues forcing some gTLD operators to sell their gTLDS, the vulnerability of some TLDs to Chinese domainers, future rounds of new gTLD applications, challenges faced by smaller TLDs, particularly new gTLDs. Here heâs concerned about how to get registrars to carry them and without a presence on platforms, Damilaville is also concerned about how the industry is flourishing for many of the established players, but quite hostile to newcomers and real innovations.
Thereâs a lot more in Damilavilleâs Q&A, so please read on!
Domain Pulse: What were the highlights, lowlights and challenges of 2019 in the domain name industry, both for you and/or the industry in general?
LoÃ¯c Damilaville: In terms of trends, 2019 has seen the continuing decline of Legacy TLDs, apart from .COM which is enjoying an enviable – even if surprising – growth rate. Surprising because with its nearly 150 million domains it still grows by 5% a year. Is this single TLD “aspirating” the market? What is driving this growth?
“Penny TLDs”, that is to say TLDs whose domain names are “given” or sold at a very low price, have increased their volumes, but we doubt that these millions of domain names are actually used. They shall be considered as highly volatile and not relevant to assess the good or bad health of the market.
The market remains vulnerable to the domaining effect: in 2019, lots of Chinese domainers have transferred their investments from new gTLDs to .TW and this one has literally exploded in a few months. At the present time, we see the reverse effect with a .TW affected by deletions and a .ICU boosted, quite at the same time, by new creations. It may mean that these domaining waves are done by a relatively small number of coordinated big investors.
This phenomenon affects the stability of the market. For instance one may consider that new gTLDs have boomed at the end of 2019 but this boom is almost 100% caused by the .ICU effect, with most of the other new gTLDs experiencing a decrease in their new registrations. A global improvement in volumes doesn’t mean that most of the players are doing well.
This situation drives some registries faced with financial difficulties to sell their TLDs to big players which are also fighting increasingly on the back-end registry market. What is interesting as regards to these back-end activities is that they are researched not only by registries of small TLDs unable to get some costly technologies and infrastructures by themselves, but also by registries of very big TLDs, maybe for the same reasons, with a difference of scale. This is the sign of a kind of professionalisation of the market, but also of a concentration process, with a handful of players on the worldwide level. On the local or regional level, lots of middle-sized players are managing some geoTLDs and/or .BRAND TLDs.
The concentration continues at the registry and registrar levels, some back-ends being both of them. This phenomenon requires (and is allowed by) the growing presence of investment funds in the capital of these players. Although made with dubious methods, the .ORG takeover by Ethos Capital is just one example of this structural evolution of the market.
The Second Round is a topic, but more an icy one than a hot one. We should wait for Winter to leave ;-).
Among the very hot topics of 2019 we have noticed security issues, fights against all kind of DNS abuses, the painful consequences of GDPR for the IP community, and the emergence of services combining data, monitoring and qualification of domain names in terms of notoriety, risks etc.
Referring to our “7As” model (*) we shall consider that 2019 has not seen great improvements in Awareness, Amplitude, Advantages, Access, Adoption, Activity nor Affect. The domain name market may be a little too self-oriented and that could explain some of the difficulties met by new TLDs to “meet their market”.
We have developed a key success factors for Internet extensions evaluation grid which you can see here: htttps://www.afnic.fr/en/resources/blog/key-success-factors-for-internet-extensions-an-evaluation-grid-1.html
DP: What are you looking forward to in 2020?
LD: The main trends of the market should remain the same: decline in Legacy gTLDs, and maybe a 4 percent growth for .COM due to their forecast price increase.
ccTLDs will be affected by the .TW and .UK deletes, but apart from this phenomenon the growth should not be above 3-4%.
New gTLDs will still be split between high volumes generic TLDs and the others. Geos seem to be stronger than Communities and little Generics but the average volume remains low. Brands will continue to progress slowly but surely. They are the most promising segment of this market.
Security, monitoring and data issues will have more and more audience in relation with the DNS Abuse efforts. Tools designed to manage the GDPR limitations will enjoy a strong interest since the needs for identifying and tracking “abusers” have not vanished, those “abusers” feeling encouraged by the anonymity guaranteed by GDPR and the failure of ICANN to provide any reliable, quick and low-cost solution to rights owners.
DP: What challenges and opportunities do you see for the year ahead?
LD: The big challenge for domain names is to exist by themselves, that is to say, to be actually perceived by users as added-value components of their internet presence and not just something technical, necessary to be reached on the internet, whether it is a .COM, .FR or .ANYTHING.
Another big challenge is for the registrars to find their way into a more diversified domain name world. One of the main burdens for new gTLDs is to reach their potential customers, a task they can’t do if they are not referenced by the registrars which actually reach these customers. But registrars seem to lack enthusiasm to sell new gTLDs which are not at first sought by their customers, and a vicious circle is in force: big registrars proposes to their customers the TLDs they already know (and buy), and the new gTLDs are kept in the shadows and not bought as the customers don’t know them very well and do not trust them.
We may also mention the “Next Round” as a challenge for the ICANN Community, but – in relation with what precedes – also for the market players in general. In the current organisation of the market, more generic TLDs will create only more confusion without being able to reach their customers. The situation of .BRANDs and .GEOs are very different because in both cases the “market” already exists: big companies will become used to consider that having their own TLD is a “must have”. And GeoTLDs are appealing to the feelings of proximity and local pride of their “natural” customers.
This leads to another big challenge. Apart from the high-volume oriented ones, the new or future TLDs will be more and more focused on niches, whether they be geographical or sectorial. This means that we will see a lot of TLDs with very low volumes compared to those we are used to see. In order to allow them to be financially viable, there MUST be a deep thought about the global financial organisation of the market.
At the ICANN level, the $25,000 flat fee is a burden that strangles many little TLDs and obliges them to sell their domain names at uncompetitive prices compared to .COM and big ccTLDs.
At the back-end level, things are more difficult to analyse but we should see in the future the emergence of some low-cost solutions targeting little TLDs and some value-added solutions targeting big TLDs or TLDs wanting to propose very specific services to their registrants. The homogeneous market as we know it nowadays is probably condemned but the transition to new models will take a long time. The growing influence of financial people in the management of TLDs should be an opportunity by providing some new means, but it can also be a threat because innovations may imperil the forecasted Return on Investment rates. When you buy a cash cow, you do not want it to become a risky bet.
DP: What progress do you see on a new round of applications for new gTLDs in 2020?
LD: There will be progress but it would be hazardous to say that everything should be settled at the end of the year. One main question â that is not addressed by the focus on process â is to ask what kind of Â«new roundÂ» we really want, and basically if we want a Â«roundÂ» or a continuous process.
It seems very logical and strategically important to allow the .BRANDs to benefit from a special, expedited and permanent process as soon as the candidates are eligible to certain rules avoiding Â«optimizationÂ» by some Â«smartÂ» guys. There are lots of reasons in favour of this special process: these TLDs are for internal use only, and since the big companies are often changing their names, creating some new trademarks, etc., they should be able to change their .BRANDs when they need to do so. For the time being, having a .BRAND is a strategic strength if you intend to keep the same name for the next decades, but it can also become a trap if you are obliged to change your companyâs name because of a merger or any other event.
The Geo-TLDs should also be allowed fast procedures if they are requested by legitimate authorities.
The fact that ICANN is only able to provide a Â«roundÂ» every ten years is not a proof of its efficiency. That said, we are aware that it depends strongly on its own Community and should not be considered the only responsible of these delays.
DP: What one thing would you like to see addressed or changed in the domain name industry?
LD: Lots of the points we could address have already been talked about. The main issue is that some problems or deficiencies, or even some threats to some players, are benefitting others, and reciprocally. The situation of the domain name industry results mostly from compromises built through power relations between its members and their Â«externalÂ» partners such as governments, right owners, customers etc.
These compromises are not fully optimal and many of them are so weak that they are constantly challenged by the dissatisfied parties. One may remark that it is the story of life: but the parties involved should make an effort to reach a long-term win-win deal more than seeking for deals which only protect their own interests in the short term.
The global situation for this market â still flourishing for the established players, but quite hostile to newcomers and real innovations â would be improved by a new approach of the challenges it faces. It is still waiting for its Â«New DealÂ» and will probably still wait for a long time, not for the better.
Previous Q&As in this series were with:
- David Fowler, vice-president, marketing and communications, Canadian Internet Registration Authority (CIRA) – here
- Katrin Ohlmer, CEO and founder of DOTZON GmbH – here
- EURid, manager of the .eu top level domain – available here
Q&As in the 2019 series were with:
- EURid, manager of the .eu top level domain (available here)
- Katrin Ohlmer, CEO and founder of DOTZON GmbH (here)
- Afiliasâ Roland LaPlante (here)
- DotBERLINâs Dirk Krischenowski (here)
- DENIC (here)
- Internet.bsâ Marc McCutcheon (here)
- nic.atâs Richard Wein (here)
- Neustarâs George Pongas (here)
- CentralNicâs Ben Crawford (here)
- CIRAâs David Fowler (here)
- Jovenet Consultingâs Jean Guillon (here)
- GGRGâs Giuseppe Graziano (here)
- Blacknight Solutionsâ Michele Neylon (here)
- Public Interest Registryâs President and CEO Jon Nevett (here)
- ICANN board member Chris Disspain (here).