Financial Crisis Hits Global Domain Registrations, But Registrations Still Increase 16% in 2008

The global financial crisis has impacted on domain name registrations with global domain registrations rising 16 per cent in 2008 to a total of 177 million domain names compared to a 27 percent increase in 2007. Overall in 2008 there were approximately 300,000 less domain name registrations each quarter than there were in 2007, according to the fourth quarter 2008 Domain Name Industry Brief published by VeriSign.2008 ended with a total of 177 million domain name registrations across all of the Top Level Domains (TLDs). In the fourth quarter of 2008, more than 10.1 million new domain names were registered across all TLDs. The composition of the domain name industry and rank order in terms of base size remained consistent in the fourth quarter. The five largest TLDs in terms of base size were .com, .cn (China), .de (Germany), .net, and .org.The 10.1 million new domain names were registered across all of the TLDs in the last quarter of 2008 reflected a slower growth in new registrations with a decline of 12 percent from the third quarter 2008 and 17 percent from the same quarter in the previous year. The decline was driven by slower growth in both gTLDs and ccTLDs. Over the entire year, there was an average of 11.9 million new domain names registered per quarter compared to an average of 12.2 million new domain names registered each quarter in 2007.Country code TLD (ccTLD) registrations totalled 71.1 million domain names with a 22 per cent increase year over year and a three percent increase quarter over quarter. This was significantly higher than the increase in registrations for gTLDs for the year. There are likely to be a number of reasons for this higher increase including the crowding of the namespace for popular gTLDs such as .com and .net, with registrations increasing 12 percent over the previous year and one percent over the third quarter of 2008. In total, .com and .net domain names grew to 90.4 million at the end of 2008.There are more than 240 ccTLD extensions globally, but the top 10 ccTLDs contribute 65 percent of the total number of registrations the report says. Among the top 25 largest ccTLDs, .ru (Russian Federation) grew the fastest with 11 percent growth quarter over quarter and .cn was not far behind with 8 percent growth quarter over quarter. Overall only 36 percent of the top 25 largest ccTLDs experienced growth rates in the fourth quarter that were higher than the growth rates in the third quarter driven largely by the overall weakening in the global economy.In terms of the total base of domain name registrations, .cn, .de and .uk were the largest ccTLDs. Year over year, growth rates were 51 percent for .cn, seven percent for .de and 13 percent for .uk. Together, the bases of domain name registrations for these three ccTLDs represented 47 percent of all ccTLDs.The renewal rate for .com and .net domain names for third quarter was approximately 72 percent the report says. While the renewal rate decline is due to changes in the earnings per click (EPC) for names registered for the purpose of participating in online advertising networks, the renewal rate for traditional registrations declined slightly as well in the third quarter.Whether a domain name resolves to a website is a key factor in the renewal rates since domain names that resolve to websites are more likely to be renewed. VeriSign estimates that 88 percent of .com and .net domain names resolve to a website, meaning that an end-user visiting that domain name would find a Web site. These websites can be further described as those having multiple pages or as one-page Web sites. One-page websites include under-construction, brochure-ware and parked pages in addition to online advertising revenue generating parked pages.Internationalised Domain Names (IDNs) also a focus in the latest Domain Name Industry Brief. The report spotlights how VeriSign and others in the global internet community are working to provide a way for people of all languages to navigate the Internet. The issue is important, because Internet usage is growing fastest in countries where English and other Latin-based languages are not the primary language.Though more than 47 domain name registry operators support IDNs, concerns over public confusion and ease of use, uneven browser support, and local network limitations have triggered a growing desire in the Internet community to provide a fully localized navigation experience by extending internationalisation to the TLD itself.To support the development of IDNs, VeriSign have ICANN and others in the internet community to pursue development of internationalised TLDs. While participants are working to resolve the many complicated challenges that exist with fully internationalised TLDs, the internet community expects the application process in the new gTLD Program will commence late this year. Tests are already underway, with public participation in usage trials designed to help ensure ongoing DNS stability and security.”The potential for internationalized TLDs to enable a universally accessible Internet is promising,” said Jill McNabb, vice president, Naming Services at VeriSign. “But it must be done right. A careless or rushed approach will expose the community to a high risk of failure over technical and business issues. VeriSign is committed to working with ICANN and others to achieve a safe, consistent and ubiquitous user experience, while protecting company brands and their customers around the world.”The February 2009 edition of VeriSign’s Domain Name Industry Brief, along with previous editions, is available from:
www.verisign.com/Resources/Naming_Services_Resources/Domain_Name_Industry_Brief/