A recent blog by Alexa Raad has shed some light on current trends in the domain name industry. She points out that the Domain Name System (DNS) market is generally divided into three major segments, which experience distinct challenges. These three segments are:
- "Legacy" generic TLDs (.com, .net, .org, .biz, .info, etc.)
- Country code TLDs
- New gTLDs.
The legacy gTLDs have the luxury of being the long-established incumbents, but most overcome issues of scale, reach, stability and management. They have been primarily consolidated under the control of Verisign, Neustar and Afilias — all of which are for-profit companies.
In contrast, the ccTLD segment is incredibly fragmented. Although many are also long-established incumbents, each ccTLD is mostly a stand-alone entity focused on administering their country's namespace. Most ccTLDs have some form of public benefit mandate, and many operate as non-profits.
Lastly, there is the new gTLD segment, which is being managed by an eclectic collection of incumbents, new entrants, ccTLDs and entrepreneurs.
In Africa, we're seeing firsthand how the presence of these three distinct categories is affecting the region's DNS marketplace.
African ccTLDs are mainly for the public's benefit, and have historically been run by universities or research centers. However, we've seen a rise in regional ccTLD management by both national information systems agencies and telecommunications regulators. While not as common, a few African ccTLDs are privately run. And in some instances, ccTLDs are being operated from outside Africa due to many factors such as legacy, pending re-delegation processes and sometimes, lack of clear consensus at national level..
As for the 'new' generation of domain names (new gTLDs), we are still working to determine how the marketplace has responded to their introduction, and how they have been used not only in Africa, but also in regions all around the globe. Of the more than a thousand new domain names to be introduced into the root of the DNS, it is likely that only 10 new TLDs will come from African applicants, including .Durban; .Capetown; .Johannesburg and .Africa. The continent's domain name consumption continues to be low, but has seen some growth over the past three years, from 700,000 registrations to more than 1,300,000 today. Clearly, there is room for improvement.
With that in mind, what can we do to strengthen the African DNS industry? What steps need to be taken? What can African ccTLDs managers do to help?
The following is a set of proposed guidelines as to what should be done, either from the ccTLD's side or the registrar's:
Understanding the scope of both the global and the regional domain name market
At times, many ccTLDs lack a basic understanding of a registry manager's objectives and goals. Not only that, but they also fail to see the wider perspectives related to the global DNS industry. A more thorough understanding of the goals and needs of all players in the industry will help develop a more efficient African DNS market.
African ccTLDs and registrars need to set up efficient and thorough performance measurement tools to facilitate data collection and mining. Doing so will provide a means for enhanced market studies and forward planning. The consensus in the community is that we hardly hear about statistics, such as overall size, renewal rates, growth metrics and seasonality. Often missing are comparative metrics or content metrics that help management understand how their name space is being used or where potential vulnerabilities may lie.
Cost varies from one registry to the other with no formal explanation or justification, leading to generally high pricing across the board. Acquisition of gTLDs seems far easier and at a lower cost than national ccTLDs, as per registrants' beliefs. There is a need for a benchmark, to provide and compare the variability in cost structures.
Arguably, depending on their categories, African registries may not meet all of their financial needs by selling domain names. It may well be strategic to develop a wider range of expertise, to help open the window of opportunity. Doing so may also allow for collaborative sourcing, shared customer support infrastructure and alternative financial reporting approaches.
The African DNS environment could be far better off if key and decisive actions are taken, such as the ones I've outlined above. ICANN has already started addressing some of the issues in partnership with African ccTLDs and registrars, namely through the DNS forum, the Cairo DNS Entrepreneurship Centre, the DNSSEC roadshows and the ongoing internship programs with global and regional DNS industry leaders. Together, we can strengthen the African DNS industry.