VeriSign, Inc. (Nasdaq: VRSN), the leading provider of intelligent infrastructure services for the Internet and telecommunications networks, today released the VeriSign(R) Domain Name Industry Brief for the third quarter of 2004, underlining key industry data for domain name activity worldwide.
According to the report, 5.1 million new domain names were registered in the third quarter of 2004, representing the highest quarterly growth in Internet history. In total, worldwide domain name registrations reached a record high of 66.3 million domain names. Other important trends in Internet usage continued at strong levels, including renewal rates and the percentage of domain names associated with Web sites.
An average of 1.2 million new registrations for domain names ending in .com and .net were added each month in the third quarter of 2004 — a 33 percent increase over the third quarter of 2003. This record-breaking increase in domain name registrations continues a trend seen throughout 2004; growth rates for domain name registrations have reached historically high levels in each of the past four quarters. The causes for this growth include a steady improvement in the global economy, an increasing population of regular Internet users with better access to the Internet, and the growing importance of domain registrations for use in the Pay-Per-Click (PPC) advertising market.
The report also highlights a continuing trend in the overall quality of the domain name base.
– Live Web sites: In a recent study of all .com and .net domain names, 77 percent of these names are currently associated with a Web site; 64 percent are live sites and 13 percent are parked sites. The number of live Web sites increased seven percent since the previous quarter, indicating that organizations are buying domain name registrations with the intent of putting them to real use.
– Renewal rates: Registry renewal rates are currently at 72 percent, demonstrating that domain name registrants are increasingly making the decision to keep their domain names.
– Growth opportunities: The domain name industry is experiencing a revival in value of domain names for the communications traffic they generate. The PPC advertising market is driving much of this domain registration growth.
“As the operator of much of the intelligent infrastructure underlying the Internet, we are able to provide a unique view into growth and development trends of the Internet,” said Raynor Dahlquist, acting vice president of VeriSign’s Naming Services. “There has been a resurgence in domain activity with the use of domains for online advertising. Additionally, the leading indicators of health of the industry are strong, with renewal rates and usage rates remaining at high levels.”
Composition In terms of market and brand awareness, .com is still the most popular domain name extension and accounts for 47 percent of all domain name registrations globally. This is followed closely by country code Top Level Domain names (ccTLDs), which are domain names ending in country codes such as .de (Germany), .uk (United Kingdom), and .jp (Japan). ccTLDs now account for 37 percent of domain registrations. Interestingly, the majority of all ccTLD domain names are registered with a few registries including .de and .uk. Additionally, alternative gTLDs (.biz, .info, .name, etc.) proved they remain strong growth areas by adding an approximate average of 90,000 registrations per month.
The report also highlights the critical role that the .net Top Level Domain plays in the health and functioning of the overall Internet. While .net accounts for only eight percent of the world’s domain names, it represents 58 percent of worldwide hosts and 30 percent of the world’s name servers. Every day, infrastructure providers, online retailers, community organizations, and government entities utilize .net as their primary domain or name servers to facilitate delivery of over 155B e-mails and roughly 30 percent of global e- Commerce.
This quarter, VeriSign also issued a Channel Report as a part of the Domain Name Industry Brief. Domain name registrars and resellers are offering new product bundles and services which have helped fuel the domain name growth. The Channel Report further details the importance of the channel and provides an inside look at how the channel sells.
VeriSign publishes the report to provide Internet users across the world with significant statistical and analytical research on the domain name industry and the Internet as a whole. Copies of this quarter’s Domain Name Industry Brief, as well as previous reports in the series, may be obtained at http://www.verisign.com/domainbrief.