Europe Will Become The Next Domain Superpower
I was watching the BBC news channel yesterday and saw a news report that suggests that the USA’s dominant superpower status is threatened. I read the full story on the BBC’s website, where it states:
“US economic, military and political dominance is likely to decline over the next two decades, according to a new US intelligence report on global trends.
The National Intelligence Council (NIC) predicts China, India and Russia will increasingly challenge US influence.
It also says the dollar may no longer be the world’s major currency, and food and water shortages will fuel conflict.”
This report caused me to start thinking about the domain industry. The US, in terms of quantity and size of domain registrations, domain-related companies, aftermarket transactions and active domainers is surely the domaining superpower.
For some time, influential domainers have been trying to draw the attention of Wall Street Capitalists to the potentials of the domain name industry.
There has been some success, but there is still a long way to go. Over the years we have seen the likes of Marchex and iREIT pumping millions into their domain portfolios over the years. Some companies have been able to secure lines of credit in the hundreds of millions.
Surely, there is a lot of money being spent in the domain industry from an investment point of view.
However, with hundreds of millions of domains registered in the majority of domain extensions, the average-user market must also be taken into consideration as well.
When all is said and done, the US is the domain superpower. But the question is, for how long?
For the Sarah Palin-type readers, Europe is a continent consisting of many countries. These include United Kingdom aka Great Britain (which consist of England, Scotland and Wales), Ireland, France, Germany, Holland, Spain, Portugal, Croatia, Italy, Belgium, Switzerland, Poland and Sweden.
Each of these countries has their own language and Country-Code Top Level Domain (ccTLD).
This grouping/continent as a whole also has its own regional ccTLD – the dot EU domain extension.
In 2005 the population of Europe was estimated to be 728 million according to the United Nations, which is slightly more than one-ninth of the world’s population.
Europe is home to the two strongest currencies in the world, namely, the British Pound sterling and the Euro.
London, capital of England, United Kingdom is regarded as the Financial Capital of the World. Europe is home to some of the world’s biggest stock exchanges. Europe has a lot of money to go around.
According to internetworldstats.com, Europe has a 48% Internet Penetration, compared to just 18% for the rest of the world. This means that 48% of the European population has readily available Internet access.
Clearly, Europe is a sleeping monster where the domain name industry is concerned. It will only take a small percentage of the European population to discover the domain industry for Europe to become the Domain Superpower.
Perhaps if you should compare domain registrations originating from Europe to the US, Europe may be the leader. Of course, most of the top domain registrars are based in the US.
The Domain Superpower that I am mainly referring to is actually the domain aftermarket and monetization services.
There is a lot of capital here in Europe, and the average resident has access to borrowings that have more spending power than the US dollar.
Any serious domainer, domain capitalist or domain investor would be silly to ignore the European market. This monster will not stay asleep for much longer.
November 22nd, 2008 at 8:56 am
Music to my ears Kevin, i’ve been saying this for a while, but everyone tells me i’m just a newbie talking and not knowing what i’m saying, but the truth is ccTLD’s in Europe, China and India will rule, dot com won’t be a king forever (it will have to share with ccTLD’s and .EU)
I trully believe .EU will have a bright future, besides in Europe the domaining mentality is different, .TV is a good example, in the US most people say .TV isn’t worth, that it will go away just like the .ME and the .MOBI, but in Europe is growing and growing.
Another very good thing for an european domainer is the power of our currencies, like you said Kevin, sterling pound and euro are an advantage, i register domains mainly in the US because euro is stronger than dollar, and because the prices are lower in US or Canadian registrars, i think European registrars are missing something here and probably they could make a lot more money.
It would also be a good idea if ccTLD’s would drop their prices, they’re still to high in some cases, others like .PT or .FR have a lot of restrictions and aren’t suitable for the domaining business
The best ones in Europe for now are .CO.UK and .DE
This post is excellent, and excelent advice for any investor, no matter if domainer or end user.
November 22nd, 2008 at 9:09 am
Any serious and true domainer would be silly to ignore any potential market… specifically the international market at the moment where emerging nations are starting to really grasp the use of the internet.
November 22nd, 2008 at 9:10 am
PS: Great article!
November 22nd, 2008 at 12:14 pm
.pl market is great too but renewal prices are still to high (~ $20 this year, ~ $15 from next year).
November 22nd, 2008 at 1:48 pm
Nice articles, That’s true we also seeing Asian market as our competitor and thus started to buy names in all tlds.
We have 2 big portfolio here.
http://www.adomaindeal.com/portfolio
http://www.dotasiadeal.com
Many domainers in USA start investing in Asian,Europe market so I don’t thinks so it can take super power.
November 22nd, 2008 at 4:18 pm
Great article. I would caution everyone though that domains by themselves will continue a uphill battle. Content is going to be increasingly important. (See Google’s latest community tools re: ranking.)
So, unless your domains garner great type-in traffic, watch for a steady decline in parked revenue.
Also, for another perspective about America losing its clout, read Libertyaholic’s comments on this subject:
http://www.libertyaholic.com/2008/11/21/spy-agencies-make-lousy-futurists/
November 22nd, 2008 at 6:33 pm
There are a lot of different ccTLds in Europe, and none of them alone will get bigger than .com. Furthermore, I do not foresee a bright future for the .EU. Here in Denmark, with the .dk extension, most companie’s second choise is with no doubt the .com tld. I believe that .com, although losing some of its power, WILL remain the most popular worldwide extension. Afterall it is the one stuck in people’s memory.
November 23rd, 2008 at 4:05 am
I think that .com shall always be king!
Yes it makes sense to buy other ext suchs as .eu .net .org .co.uk .ie .in .de and the hundreds of others but lets be honest guys .com is and shall always be King.
Regards,
Robbie
November 23rd, 2008 at 10:28 am
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November 23rd, 2008 at 12:37 pm
I’ll explain the why i said .com won’t always be king, or at least it will have to share its power.
First of all, domainers who have been in the business for years own most of the good dot coms, new domainers and end users if they can’t afford to have dot com, they’ll prefer to have the best possible keywords even if in a different extension.
Second, think about this, how many businesses are in the world? possibly thousands of millions, from one man business to big corporations, so how many of these are global businesses? i don’t have any statistics but i’ll dare to say that less than 10% are global. That being said, most businesses are local, most of them aren’t even national, but only local, and most of the businesses will prefer to have their own ccTLD than a dot com, the ccTLD will identify them better than a dot com.
The truth is that extensions that were forseen as having no future like dot tv, are now growing, and they will continue to.
The .EU is something i believe in, not just right now, but in 2/3 years it will have importance, there were and still are a lot of resistance from EU members population to the concept of the EU, and that somehow reflects the domain extension choice, but those resistances are slowly disappearing, and being the EU an open market of 27 countries, it will be important to many businesses to have an EU presence, let’s see what the future holds.
November 23rd, 2008 at 2:06 pm
Kevin,
first and foremost, good article with an incorrect fact:
“Europe is home to the two strongest currencies in the world, namely, the British Pound sterling and the Euro.”
Totally untrue. Look at Kuwaiti Dinar, KSA Dinar, Oman Dinar…
I can go on.
Next, as Robbie says “.com” will always be the king. In fact Europe is in a slightly worse situation than US in terms of Economics.
November 24th, 2008 at 7:32 am
Great article! However I don’t know if that will be the case in the near future (as EU citizen, it would be nice
November 24th, 2008 at 7:44 am
Ace,
Am not familiar with the value or strength of the Kuwaiti Dinar, KSA Dinar or Oman Dinar.
I don’t think these currencies are widely traded or used as any popular currency of choice in international trade. I personally don’t trade these currencies in the currency markets.
Secondly, most of these countries you mentioned have very strict visa requirements; to visit some of these countries as a tourist is nearly impossible. Kingdom of Saudi Arabia, if my memory serves me right, only gives visas for business or diplomatic purposes.
As these are all oil rich states, if we could get them into the domain industry, we would be bathing in liquid gold!!