European ccTLD Growth Slows To 2.4% As Slowdown Drives Consolidation and Innovation: CENTR

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The median growth among the European ccTLDs slowed to 2.4% in the year ending October 2019, down from the 3.1% recorded in the year to October 2018, according to the latest CENTRstats Global TLD Report. When CENTR filtered to the 20 largest ccTLDs in Europe, the growth was just 1.2%. Despite the low growth, other performance indicators such the delete and renewal ratios have been stable. However, the median create ratio, which measures the proportions of new domains entering a TLD, has been increasing marginally over recent months.

Across the European continent, the market share for the local ccTLDs averages 54%, based on registrants based in the country. For almost all countries, the local ccTLD is the largest by local registrations, followed generally by .com or .eu. Other ccTLD penetration indicators are domains per 100 capita at 6.1 and sites in the Alexa top 1000 which sits at 30%.

Pricing of European ccTLDs is currently recorded at a median of €12.70 for a new registration and slightly above for a renewal. This contrasts, according to CENTR’s analysis, to gTLD pricing where the median buy and renewal price are €24 and €26 respectively.

Market mover European ccTLDs over the past year were .uk (United Kingdom), .ie (Ireland) and .me (Montenegro) among others. The Irish ccTLD (.ie) has performed particularly well, having recorded high growth and an increased global Cisco rank. It has done this without compromising its renewal ratio which is above the European average, and also by keeping deletions low.

CENTR, in the latest of their quarterly CENTRstats Global TLD Reports published last week, ponders whether continued stagnation is due to reduced business confidence, saturated markets, alternative forms of online presence, or even the departure of speculation (‘domaining’), but they believe the dwindling growth is starting to drive other phenomena. Examples include consolidation among registries and registrars, as well as innovation in business intelligence analysis and tools. The effects of consolidation may even have an effect on TLD market share. For example, within the gTLDs, CENTR found 95% of domains are held in the top 20. This figure this has been rising since early 2019. With so much choice among gTLDs, CENTR speculates it is entirely possible that consumers, overwhelmed by choice, are shifting to what they know or see advertised. Slow growth is also driving innovation, for example in Europe where ccTLD operators are developing domain crawlers, standardising registration terminology and improving monitoring tools to better understand how their domains are being used (or abused).

The largest top-level domain continues to be .com, maintaining around 45% of the global market share with a growth rate of almost 5% year-on-year which, in absolute terms, is similar to the combined net growth of all recorded ccTLDs in the same period. .com’s growth even overtook that of the top 300 gTLDs early in 2019, however it has recently begun to show signs of a slowdown, with deletions on the rise. Recent news that Verisign (the registry for .com) will soon be able to increase prices will no doubt impact these trends further.

Although several new generic top-level domains (new gTLDs) such as .fun, .live, .host and others had surges in domain volume as well as improved global Cisco ranks, median growth in the group (gTLDs from the 2012 ICANN applications) has generally been lacklustre at just 1.8% YOY. Market mover ccTLDs were .id (Indonesia), .ai (Anguilla), .mx (Mexico) and .ar (Argentina) all with double digit growth and an increased global Cisco rank.

On gTLDs, CENTR found the top 300 gTLDs grew at a median rate of 1.8% YOY which is the lowest rate on record. Driving this is the convergence of the median create (decreasing) and delete (increasing) ratios. A new trend has been emerging related to the concentration of domains to the largest gTLDs. The concentration ratio in the dashboard measures the share of gTLD domains within the top 20 gTLDs. Up until the end of 2018, this ratio had been reducing, however, from early 2019 it took a sharp turn and has been increasing consistently since. This trend suggests the market demand may be shifting toward a smaller group of gTLDs, putting further pressure on those smaller gTLDs trying to get ‘shelf space’ and attention from registrars.

After a period of above-average growth, CENTR notes deletions in .com are more recently on the rise, putting downward pressure on its growth. Its deletion rate was recorded at 22% (Sep 2019) which they note is not bad compared to the top 300 gTLD median (26%). However, this is high when compared to other mature TLDs such as the European ccTLDs (13%). The rate has nonetheless been manageable for .com as its creation ratio (a ratio measuring the proportionate volume of new domains entering the zone) has been stable, recording 25% at the same point.

Around a dozen gTLDs of substantial size (over 100K domains) achieved double digit growth while increasing their global Cisco rank. As pricing plays an important role in market demand, it is worth noting that among these gTLDs, the median price in late 2019 was recorded at US$16. While similar to registrar pricing of European ccTLDs, it is considerably different to the top 300 largest gTLDs where the median is $27.

To read the report in full with graphs, see