Will 2017 finally be the year of the new gTLD?

Stuart Fuller

If 2015 was a year of slow burn and frustration in the new gTLD world, then 2016 has been a year when we’re finally starting to see the registration numbers many predicted when the expansion of the Internet was first announced back in 2011. Registration numbers have increased by 240% in just 12 months, despite the number of new gTLD launches dropping from 136 in 2015 to just 62 in 2016. The program has now reached a point where the initial land-grab of registrations is slowly turning into usage cases that are adding value for their registrants, as well as bringing some innovation and fresh thinking into a previously stagnant industry. But is it enough to convince the domain name doubters that we’re in the middle of a revolution rather than a gentle evolution?

Although we’ve continued to see growth in traditional gTLDs – currently tracking around 7% year on year – it’s the new gTLD registration boom in the Chinese market that has been the story of 2016. The marketing campaigns launched around Chinese New Year and then again in the summer to celebrate the anniversary of the launch of dotXYZ proved incredibly successful. The Californian-based registry added more than 4.2 million domains (growth of 330%) in just six months, whilst Minds + Machines’ launch of dotVIP saw it add 400,000 registrations in less than two weeks after General Availability.

Today, approximately 44% of the new gTLDs are registered to individuals or businesses in China. The top 10 most registered TLDs are all characterized by significant numbers from the country, as well as conforming to a clear pattern that has proved to be very successful. Now, with the news that dotXYZ LLC and Minds + Machines have been granted licenses to run their name servers in China, the domain names registered in huge quantities earlier in the year can be used rather than just parked. Expect to see some tactical pricing promotions from both registries in 2017 to take advantage of this development.

However, we are still yet to see major adoption of new gTLDs by companies, big or small. In the current list of the 100,000 most popular websites, based on traffic and compiled by Alexa, there are 1,589 new gTLDs. Unsurprisingly, the most popular gTLDs in the list reflect the overall registration numbers. DotXYZ leads the way with 299 websites, then dotClub (157), dotOnline (133), dotTop (79) and dotSite (71). Within the top ten most popular websites, eight appear to be used for unknown purposes, made up of random numbers and letters. The most popular, www.kinogo.club, is a Russian-language streaming website, whilst the second is www.namu.wiki, which is a Korean-language project-sharing site.

We did see the launch of a few very interesting new gTLDs in 2016. The eagerly anticipated dotStore and dotShop went live in June and September respectively, and have fared well. DotStore has 81,500 registrations at time of writing, whilst dotShop has around 104,000. GMO, the registry behind the dotShop gTLD has a significant investment to recoup in its domain suffix, and has recently announced that it will offer a free SSL certificate, provided by its sister company GlobalSign, to registrants in 2017, which could be a very attractive proposition for many organizations.

So, what can we expect in 2017? Well, we have a number of gTLDs that could be popular both in terms of speculative registrations, which have characterized the growth from the Asian market this year, and active usage. Top of the list is undoubtedly dotWeb, bought at auction in 2016 by Nu Dot Co for an eye-watering $135 million. The registry will need to come up with something very special to start getting a return on its investment. Then there’s the ongoing saga over the future of the dotAfrica application, which has enough controversy to be turned into a movie.

The consolidation of new gTLD registries will continue as many of the less popular suffixes are re-evaluated by their owners as ongoing commercial concerns. Two examples of this in the past few weeks are the decision by the Whoswho registry to essentially turn itself into a dotBrand after failing to top 100 registrations since launch, and Donuts’ acquisition of the dotIrish registry operation, along with its 2,000 dotIrish registrations.

With just over 7,500 registrations, the controversial dotSucks could see its base eroded as brand holders start to realize that the initial hype surrounding the suffix and high retail cost for many names isn’t compelling enough for them to renew their names for another year. At the first renewal anniversary in 2016, around 9% of the registration base disappeared – and perhaps that’s why the registry has recently announced a price reduction ahead of the second renewal cycle.

But what we all want to see is more usage of the new gTLDs. Nearly 19 million of the current 27 million registrations resolve to a parked or static page – that’s almost 70% of the total. In some new gTLDs, that percentage is significantly higher: with dotXin, for instance, parked pages represent over 97% of the 319,000 registrations; and with dotWang – the fourth most popular new gTLD – 88% of the names are parked. The impact of having one or two brands actively using new gTLDs, and featuring highly in the Alexa rankings, cannot be underestimated. That’s what the whole industry wants and needs to see; perhaps 2017 could be the year when that tipping point is reached.

As for the dotBrand world? That’s a different story, and one we’ll cover in the coming weeks, focusing on the opportunities and threats that brand holders have as attention starts to turn to a second round of applications in the next few years.