New gTLDs are the biggest change to the internet in years, but many registrars reluctant to embrace” says an eco study

A study on the domain industry comparing countries

With many registrars being quite small, “domain name registrants prefer to use a registrar within their own country”, was one of the findings (PDF) of the annual eco Registrar Atlas,  although they are slowly expanding in their offerings. One in five (22%) offered 10 TLDs or less to their customers according to the 2012 survey, although this number was down from 28 percent who offered ten TLDs or less in 2011.

The study, expanded from its usual coverage of registrars in the German-speaking countries (Germany, Austria and Switzerland) plus The Netherlands to also include France, Great Britain, Bulgaria and Russia for the first time, and also covered registrar attitudes to marketing, DNSSEC and new generic Top Level Domains.

The most outward looking when it comes to offering a range of TLDs was The Netherlands, where no registrar offered less than 10 TLDs and 43 percent offered more than 250 TLDs.

Maybe it is linked to their size, but the survey found most registrars do little marketing. This was something the study found and noticeable in Germany in 2011. Registrars undoubtedly lose a lot of potential business because of this. The best market where registrars were actively marketing their services is The Netherlands where still less than half (42%) of those surveyed stated that they are not at all, or only barely, active with respect to marketing. A quarter (25%) said they are doing more than the average and while eight percent rated themselves as very active.

Security of domain names is an important issue, but the survey found registrars were still wanting when it comes to offering domain names secured by DNSSEC. In 2011, 17 percent of registrars stated they already offered DNSSEC and 45 percent wanted to introduce DNSSEC within one year. But in 2012 this expectation has not been met. Only 19 percent of registrars said they were offering DNSSEC and the percentage intending to introduce DNSSEC within the next year is even smaller than it was last year.

But the biggest change coming for registrars, and the domain name industry as a whole, is the introduction of new gTLDs, with the first expected to be online well before the end of 2013.

According to the study, registrars believe new gTLDs such as .moscow, .nyc, .radio or .sport can expect to be the most popular. Well over a third (37%) of German registrars rate these and similar new gTLDs as having a very high chances of success. Despite this, over half of the respondents surveyed (58%) were in agreement that the demand would be dependent on specific address expansions.

However for registrants, finding a registrar selling the gTLD of their choice might be difficult as most registrars do not intend to offer them to their customers. In Germany only a quarter (24%) of respondents intend to offer the new gTLDs. In Austria it is 29 percent and in Switzerland and Great Britain it is a third (33%).

The registrar’s reluctance in becoming accredited for more than a few of the new gTLDs is due to the cost in both time and financially.

However gTLDs backed by companies such as Amazon and Google are likely to attempt get around this by offering their gTLDs to the public.

“At the latest since we’ve known that Amazon and Google have applied for large portfolios of new TLDs, there’s been no doubt that in particular the global players will take the new endings to the world,” said Thomas Rickert, Director of the Competence Group Names and Numbers in the eco Association.

Registrars themselves though are optimistic about the future, and expect revenues to grow, although they are more cautious than in previous years. They see the greatest danger for the domain industry in the use of apps and search engines on mobile devices.

Registrars like NetNames considers The DotBigBang of the internet (the explosion that comes with the new gTLDs) to be so strategically important to a brands’ future online strategy and provides organizations with a free analysis of its current domain portfolio, a recommended registration strategy and advice on where new gTLDs will fit into the organization’s domain name registration strategy.

Opportunities for brand holders to strengthen their IP rarely come along.  This is a once in a decade opportunity to put a clear and robust domain name strategy in place.  Our advice is to act now before someone else does.

So lets watch this space, shall we?


1 August 2013