174 Million Domain Names Worldwide, But Registration Growth Slows

VeriSign logoVerisign’s latest Domain Name Industry Brief shows there are now 174 million domain names registered worldwide – a 19 per cent increase over the same time last year, but only a three per cent increase over the second quarter 2008. The slowdown in growth would appear to indicate the global financial crisis is having an impact on domain name registrations.

Of this 174 million domain names, 68.9 million domain names were country code Top Level Domains (ccTLDs). These grew by five per cent quarter on quarter and 26 per cent year on year showing faster growth than the generic Top Level Domains such as .com.

Of the largest Top Level Domains, .com had by far the most registered domain names, followed by .cn (China), .de (Germany), .net, .org, .uk (United Kingdom), .info, .nl (The Netherlands), .eu (European Union) and .biz.

Among the top ten largest ccTLDs, the report notes there were several changes as .br (Brazil) climbed up to the eighth position and .au (Australia) joined the top ten for the first time, displacing .ch (Switzerland). Brazil and Australia continued their growth trends from the previous quarter driven by changes in their registration policies.

The top three ccTLDs (.cn, .de and .uk) accounted for 47 per cent of ccTLD registrations while the top ten (top 3 plus .nl, .eu, .ar, .it, .br, .us and .au) accounted for 66 per cent of all ccTLD registrations.

The impact of the global financial crisis was shown among the ccTLDs where in the main growth rates were flat or slowing compared to the previous quarter (Q2, 2008). Among the top 25 largest ccTLDs, four .eu, .kr (South Korea), .es (Spain) and .tv (Tuvalu) experienced larger quarterly growth rates than in the second quarter

On the gTLDs, at the end of the third quarter 2008 there were 89.4 million .com and .net domain names, an increase of two percent on Q2 and 16 per cent year on year.

“New .com and .net registrations were added at an average of 2.3 million per month in the third quarter of 2008 for a total of 6.9 million new registrations in the quarter says the report. This is a nine percent decline over the second quarter and an eight percent decrease over the same quarter last year. Historically, there has been slowing in the third quarter due to seasonality. New registrations averaged 7.2 million per quarter in 2007 and are averaging 7.4 million to date in 2008.”

“VeriSign estimates that the number of .com and .net domain names registered for traditional purposes represented 92 per cent of the base. The percentage of .com and .net domain names registered with the intent of generating online advertising revenue is estimated at eight percent of the base. The number of new .com and .net domain names registered with the intent of generating online advertising revenue saw pronounced weakness again in third quarter due in part to changes in Google’s Ad-Sense program and lower spending trends in Internet advertising. As some US-based registrars forecast that economic conditions may contribute to lower than expected growth rates in the coming quarter, coupled with continued weakness in online advertising, the base of .com and .net domain names is estimated to increase one to two million domain names in the fourth quarter.”

Some other interesting issues to note coming out of the report are:
VeriSign processed peak loads of more than 50 billion Domain Name System (DNS) queries per day in the third quarter of 2008 with VeriSign DNS continued to maintain operational accuracy and stability for 100 percent of the time during the third quarter of 2008, as it has for the past decade
whether a domain name resolves to a Web site is a key factor in the renewal rates since domain names that resolve to web sites are more likely to be renewed with VeriSign estimating 89 percent of .com and .net domain names resolve to a web site
approximately 80 percent of the Internet users in the United States watch online video at least once per month with the number of online video viewers is expected to grow to 88 percent of internet users in the United States or 190 million people by 2012.

VeriSign, the global registry operator for .com and .net, reviews the state of the domain name industry through a variety of statistical and analytical research each quarter.

The report is available from VeriSign at www.verisign.com/static/044349.pdf.