Company says it can’t predict if surge will continue, nor what renewal rates will be.
.Com registry Verisign issued a statement today regarding an upcoming presentation at a financial conference and provided commentary on the Chinese domain name market. Domain name registrations in China are leading to an outsized performance in domain name registrations this quarter.
The company said its domain name base is up 4.1 million for .com and .net this quarter as of November 22, 2015. The company noted:
…While there continues to be demand for domain names globally, the recent increased volume for Verisign’s top level domains, as well as top level domains of other registries, during the fourth quarter is coming largely through registrars in China.
In the past, Verisign has discussed many factors that affect the demand for domain names, including, but not limited to economic, social, and regulatory conditions, Internet adoption, Internet penetration, and increasing e-commerce. In addition to these factors affecting demand, Verisign is also evaluating additional potential factors unique to China that may also be responsible for the recent increased volume of new registrations in China.
In no particular order, these potential factors, or combination of factors, could include, but may not be limited to, government initiatives in China to develop their online economy such as ‘Internet Plus;’ registry and registrar regulatory requirements; cultural influences such as the popularity of numeric domain names; increasing competition amongst Chinese registrars; potential increases in domain name investment activity; and recent capital markets volatility and access to capital in China.
Verisign cannot predict if or how long this increased pace of gross additions will continue and we cannot at this time predict what the renewal rate for these domain names will be. Verisign has noted in the past that renewal rates for domain names registered in emerging markets, such as China, have historically been lower than those registered in more developed markets. Verisign will continue to evaluate these and potentially other factors and expects to have additional information related to the domain name base on Verisign’s fourth quarter and full year 2015 earnings call.
Joseph Peterson says
Bubble or not, domain speculation can move the needle even for a large company like Verisign.
Stock market investors are affected by the actions of domain investors.
Jeff Schneider says
Right you are Joseph, In many ways .COM Asset Players are conducting the Orchestra.
Gratefully, Jeff Schneider (Contact Group) (Metal Tiger) (Former Rockefeller IBEC Marketing Analyst/Strategist) (Licensed CBOE Commodity Hedge Strategist)http://www.UseBiz.com
Steve says
“Stock market investors are affected by the actions of domain investors.”
And we still have a kangaroo arbitration system. No offence to kangaroos. You think by now the disputes would be settled in a real court with real penalties for rdnh.
John McCormac says
The number of new .COM domains in the zone file (20151123) compared to that of 01/November/2015 was 4,076,296. It definitely is an issue for Verisign as four of the top five hosters with new .COM registrations for the last few months have been Chinese hosters.
Andrew Allemann says
It’s an interesting point that, while registrars have been winning from this domain name surge, it’s not the usual American registrars.
John McCormac says
The zones are approximately three months ahead of the ICANN reports, Andrew,
It would be possible to break down the new registration patterns (4L/4N/5L/5N etc) by hoster. Correlating them to registrars is difficult but not impossible.
Henry says
An interesting observation that, “the top five hosters with new .COM registrations for the last few months have been Chinese hosters.” It seems that Chinese hoster’s customers are not encumbered by the myopic interpretation of what is a good domain name if it was not three letters or less. I still remember many a western domainers poo pooing certain 3NL combos, some four and five character names that are not actual words, and to a lesser degree, numbers as recent as five years ago.
It goes to show you, you just don’t know what the rest of world wants, especially the part of the world you don’t know or understand anything about.
Many people, myself included, sold off a great deal of their 3NL combo names for the cheap. Today, many are worth a pretty penny. Even NNNNNN domain names are worth a bit today. And there are other parts of the world that have not come online yet.
John McCormac says
I track domain name registrations/renewal trends in addition to running web usage surveys on TLDs, Henry.
My view of things is not exactly that of just a domainer. What I do know is that some of the Chinese hosters have very high non-renewal rates for one year registrations. This is somewhat different to hosters in more mature markets where the renewal rates are over 65%. Growth in .COM in the mature markets with strong ccTLDs has been slowing for a few years now. The Chinese registrations have been a lucky boost to the .COM and .NET zones. The big question is whether those Chinese registrations will all be renewed next year.
Howie says
As I recently wrote in a post regarding the Bank of China’s decision to devalue the renminbi in August 2015, along with the paper stock flut.
China is investing heavily beyond digital with Chinese investors sourcing the best Western contemporary art via phone bids, along with gold to shelter themselves from further market volatility.
So we can be naive to say that there is a ‘total’ swing from Chinese stocks to Chinese domain names.
This Chinese domain market has now become a pyramid of sorts, the longer the numerics gets, the higher one peaks. And I’m not denying there are 7N 8N selling, 4.cn saw a 8N .com recently sell for just over $1k and a 12N! entered making $65.
It’s an interesting race to the top with these fresh regs, but are there alternative patterns that will pip the post?