2017 –A decisive year for the domain industry? A ccTLD perspective… Peter Van Roste peter@ centr.org ICANN58 Copenhagen, Denmark 13 March 2017
Agenda Problem Statement The new global TLD market Registrations: growth, adds/renews/deletes, market shares Impacts from new gTLDs and Chinese investment
Problem Statement Problem Statement: Maintaining long term revenue sustainability in a market of declining to stagnant growth
A long long time ago, in a namespace far, far away… . 4
Domains in context Domains in context 1.7 billion active Facebook accounts & 300 million domain names At least 1.4 billion Facebook users not likely to have a domain name…. Facebook accounts 1,800 Millions 1,600 Gmail 1,400 accounts 1,200 Instagram Domains accounts Tumblr 1,000 (all TLDs) accounts 800 Twitter LinkedIn 600 accounts accounts 400 200 - 6
Global TLD trends Global TLD trends
Global ccTLDs: By Region Global ccTLDs: By Region ccTLDs by Region
European ccTLDs: Overview European ccTLDs: Overview European ccTLDs • 69.6 million domains • Median growth 2016: 3.5% (long term trend decline) • High growth in 2016: .am (Armenia, .ee (Estonia), .pt (Portugal) • Av. Wholesale price 7.0 EUR (convergence to median) • Median retention rate: 85% (stable) • Average ccTLD market share in country: 51% (stable to small trend up)
2016 Growth by TLD 2016 Growth by TLD 10
Monthly Trend: Domain Growth Monthly Trend: Domain Growth Median ccTLD Growth (35 ccTLDs) Fastest declines Stabilisation of in ccTLD median ccTLD growth 1.6% growth New gTLD (2014 +) (2012 -2014) applications opens (Jan 2012) 1.2% First new gTLD delegation (Oct 2013) 0.8% 0.4% 0.0% Feb 10 Feb 11 Feb 12 Feb 13 Feb 14 Feb 15 Feb 16
Monthly Trend: Domain Growth Monthly Trend: Domain Growth Median Growth 35 ccTLDs, 5 legacy gTLDs, top 300 new gTLDs 3.1% European ccTLD Median 2.1% 1.1% 0.1% Feb 10 Feb 11 Feb 12 Feb 13 Feb 14 Feb 15 Feb 16 Feb 17 -0.9%
Annual Trend: Domain Growth Annual Trend: Domain Growth Median Growth: Annual 35 ccTLDs, 5 legacy gTLDs, top 300 new gTLDs 12.6% What has driven the stabilisation?… 8.8% 5.6% 3.7% 3.4% 3.4% 2011 2012 2013 2014 2015 2016
Annual Trend: Median Add & Churn Ratio Annual Trend: Median Add & Churn Ratio Median Adds/Churn 35 ccTLDs 30% 25% Drivers to Stabilisation Adds 1. Less deletes in 2015 18.6 % 20% 2. New adds stabilised in 2015-2016 15% Issue: Long term adds trend heading toward Churn churn ratio intersection while Retentions rates 15.7% 10% are mostly flat. 2011 2012 2013 2014 2015 2016 2017 2018
Market Positions: Retentions & Adds Market Positions: Retentions & Adds Market Trend Decreasing new adds, small increase in Retentions
TLD Market Share: European Countries TLD Market Share: European Countries Average Breakdown of TLDs by locally registered domains 33 European Countries New National gTLDs, ccTLD, • Av. local market share 51% to ccTLD 3.4% 51.2% (stable) • Low av. new gTLD market share. Legacy • Since 2015, small % decline in legacy gTLDs, 35.4% gTLDs in favour of new gTLDs. Other European ccTLDs 10.1%
Summary Summary • Long term add growth declining toward churn intersection • Renewals are flat • Local ccTLD market share stable with limited volume impact from new gTLDs • Limited impact from boom in Chinese investment
Problem Statement & Choices Problem Statement & Choices Long term growth is stagnating (new domain growth slowing, flat renewals) Increasing pressure to cost/revenue margin Possible options to ccTLDs Price adjustment? Look for new market segments (SMEs)? Cost cutting? Diversification?
Thank you pet er@ cent r.org
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