As you know the most used country code domains, have grown exponentially, as users people in those countries are looking for information and to deal with products in their own country.
However a story in the Telegraph.co.uk highlight the a new problem of using country codes to trick people into thinking they are buying from a “local” business.
According to the story, up to 480,000 sites, representing approximately 6% of all .co.uk domains, which sell goods (rather than informational sites) are based outside the UK, but carry the co.uk domain name. Many of these sites are based in China but use co.uk as part of their domain name, fooling shoppers into thinking the company is UK-based.
This has lead the “Trading standards office” in the UK to issue an offical warning to its citizens telling them, the co.uk suffix is lulling consumers into a sense of false security and have warned internet shoppers not to presume that sites that carry it are British.
If this problem expands not only in the UK but in other major ccTLD’s, will people lose faith in their country code and lead to greater use of .com’s?
Also, the need may arise for more site verification services.
Eventually the sales pitches will read something like, “Are you sure your doing, what your doing, where your doing it, if you are even doing it at all?”
The .US registry apparently does do integrity checks to insure that registrants meet nexus requirements such as being incorporated within the U.S., or being a citizen of the U.S. Some .US domains registered to overseas registrants have been cancelled in the past two years due to not meeting requirements.
Have no idea to what extent these integrity checks occur with other ccTLD’s.
In the case of .uk, it is the price that a ccTLD pays to have open registration. Some ccTLDs have a managed registry approach where there has to be some proof of entitlement (IEDR with .ie) or a nexus requirement (DENIC with .de). With restrictive regulatory framework a ccTLD will remain small. With a more open regulatory framework a ccTLD will grow rapidly if it is backed by a country that has the population and economy to encourage usage. The worst case example would be .eu with its Eurid registry. The economy is there and the population is large enough to support it. But it does not. Eurid is supposed to maintain the integrity of the .eu ccTLD, it does not do so and the .eu is riddled with bogus registrations complete, in some cases, with US zipcodes and a token EU country. The problem is that if Eurid bothered to take any action against non-compliant registrations and domain warehousing, the domain count in .eu ccTLD would drop rather dramatically. Though it is supposed to be a country code, there is no such country as the European Union and almost every country in the EU prefers its local ccTLD.
The trend in many EU ccTLDs has been that the local ccTLD is beginning to overtake the numbers of .com domains registered. The first stage of this transition is that the number of domains in the local ccTLD will equal the numbers of .com registrations in that country. Then the ccTLD domain count will overtake the numbers of com/net/org/biz/info/mobi domains registered in that country. After that it becomes a cascade where all attention is focused on the ccTLD. The .uk with approximately 7.7 million domains is a good example as is the .de with its 12.9 million domains. The local ccTLD in the UK and Germany are by far the most popular and it is very rare to see anything other than a .uk website advertised in the UK media or anything other than the .de in the German media. While both these countries have significant com/net/org/biz/info footprints, the focus is almost entirely on the ccTLD and many new registrations outside the ccTLD are often brand protection registrations.
The momentum in European countries is towards the ccTLDs and it may well be unstoppable. Perhaps changing the regulatory framework for every open ccTLD to a managed registry ccTLD might do it but .com has definitely been eclipsed in the EU by the local ccTLDs. In the newly joined Eastern European states of the EU, the .eu ccTLD has actually replaced .com as the second choice TLD. But there has been an interesting trend in the older EU states of small businesses dropping or not renewing their .eu domains as they concentrate on their core brand domain – and that’s usually their ccTLD domain. If you look at the .eu breakdowns over the individual countries and then compare them with the domain counts from the local ccTLDs, you can see just how badly .eu ccTLD is doing. (The only purpose it seems to serve now is as a transnational domain like a .com domain.) The .com usage is near parity, locally, with some of the smaller ccTLDs but .eu is is very much a third or fourth choice TLD that is competing with .net or .org TLDs.
While .com may retain its position as the global TLD, the reality is that as countries become more connected and their economies more developed, they turn towards their local ccTLDs. The other curious effect is that when adjacent countries begin to sell into each other’s markets, they don’t choose .com to do it. They actually register their brand or company name in the adjacent country’s ccTLD. Perhaps one of the best examples of that would be how the second most popular ccTLD in Ireland is not actually .eu but rather .uk. At least 10K .co.uk domains are on Irish hosters. That’s compared to around 7K or so .eu domains that are genuinely Irish registered. The same adjacent market effect would be more apparent in mainland Europe as the markets would be bigger and nearer.
As for people losing faith in their country code – it happened in Ireland about nine years ago when the registry was run by people who really didn’t have a clue about the domain business. It was the classic ccTLD problem where a ccTLD registry starts out as part of a university department run by people who may know the technology but have an amateurish approach to the domain business. The price of .ie domains was around $150 per registration, only one domain per company or business was allowed and there were no generic terms could be registered. It was a complete mess and .ie ccTLD was actively ignored by Irish businesses and the Irish people. The numbers of .ie registrations remained low while use of .com grew rapidly. In 2004 there was a more enlightened regulatory framework imposed and a more sensible business structure worked out. The .ie ccTLD began to grow rapidly. The prices also came down and the ccTLD began to grow again. The price of .ie domains is now around $30. It is now at 128555 domains which is closing on the numbers of Irish registered com/net/org/biz/info/mobi/eu domains. So only the imposition of the most extremely anti-business, anti-reality regulatory framework on a ccTLD registry would cause a shift to or a return to .com as the domain of choice. What is worrying is that the growth in .com TLD, with the domain tasting element removed, is not too different to that of 2003/2004. Cumulatively, the growth in ccTLDs is beginning to overtake .com growth.
John
One of the things that can stop this unstoppable march towards ccTLD’s is if the public loses confidence that these local extensions represent local businesses.
This could happen if the registry does not have control over the extension and the extension get abused by a substantial amount of outside of the boarder interests.
Michael do you propose that every cctld should only be open to the citizens of their country ?
Dot
I think that would benefit the extensions, in the long run.
That would do it, Michael,
But the ccTLD registries tend to take their position seriously as their authority is derived, ultimately, from the government of the country. I think that some of the ccTLD legislation would allow the ccTLD to be redelegated if the registry was not doing its job. Thus any developing problem could be dealt with far more rapidly than with ICANN and its registries since there is a single chain of command. With ICANN, there are layers of denials, talking, reports and meetings to go through first and these can last for years before any action is taken.
The ccTLD registries would probably have a more powerful set of regulations for dealing with any threats to the integrity of their ccTLDs. The potential weak link is in how the ccTLD registry chooses to interpret those regulations. Again the .eu ccTLD is the classic example of what happens when a registry fails to act, despite having the necessary legal powers, and when the regulatory framework is inherently flawed. It devalues the extension for every registrant. Even worse for a ccTLD, it destroys consumer confidence in the extension and that’s very difficult to recover.
The regulatory frameworks for most ccTLD registries have evolved over the years, often in consultation with the domain business and other players. For many, it was a very hard evolution from Academia to the reality of commerce. Top down imposition rarely works and leads to very poor registration figures and very little consumer confidence in the extension.
There is also a psychological aspect to ccTLDs that is missing in the TLDs and gTLDs. The identification of the user with their country makes the ccTLD different. Some of the ccTLDs are limited to citizens and businesses of their respective countries. This tends to create a very strong local brand but it also flattens the growth curve. With .ie ccTLD (Ireland) for example, there has to be a strong link with Ireland whether through citizenship, business or trademark. The .de ccTLD has a nexus requirement for the administrative contact. The strong identification of the people with their country’s ccTLD and its widespread use is what ensures a successful ccTLD. This could be good news for some of the new city gTLDs as they have the population and economy to make a city gTLD viable.
The ccTLDs tend to be either open (minimal registration requirements) or managed (restricted by proof of entitlement, location or other regulations). The open ones tend to do well when there is a strong economy and population backing them. Even managed ccTLDs will do well when they have a sufficient economy and population. The ccTLDs without the population and economy tend to remain small or get repurposed (.tv, .ws, .cc etc). Initially, a country only ccTLD makes a lot of sense – at least until the ccTLD gains critical mass. Eventually, a ccTLD becomes a country level market TLD that caters for people and businesses in that country and for people and businesses selling into that country’s market.
It’s one news story and trading standards failing to consult its own government departments over advice. Fortunately the story is getting more of an audience than it deserves, however the audience are not being educated through articles nor are any able to present a solution.
No, there is no worry over .co.uk however there are uk rules with regards privacy policy, addresses on sites for trading, neither of which did the chinese wholesaler have on their website, nor does he on his other site which is still trading and live – well was as of last night – that’s how clued up the bbc and trading standards are.
Which in conclusion, we see trading standards blabbering on about how .co.uk being a free and open market is wrong instead of actually getting off their ‘arris and doing some work and shutting down the site due to compliance issues and presenting a green paper on regulating websites through verified sales vendor mechanisms linked to a trading standards certificate, they decided it would be best to point the finger at Nominet, when in fact trading standards are the ones to blame for inaction, no forward planning and no real idea as to how to ensure safe online shopping and the management of such a policy which they are already tasked to oversee – I would presume.
Now would someone please write about that and point the finger back at trading standards and inform the bbc that their lack of knowledge on the subject matter shows that they have failed to report on this news as accurately as they otherwise might have, had someone with a brain actually asked someone in the know about this sector for advice instead of pointing fingers off the back of failed research.
Lee
“Would someone please write about that and point the finger back at trading standards and inform the bbc that their lack of knowledge on the subject matter shows that they have failed to report on this news as accurately as they otherwise might have”
I think you just did
via CHRON…
WASHINGTON — The Supreme Court won’t decide who really owns the initials “SC” when it comes to college sports: the University of Southern California or the University of South Carolina.
The high court on Monday refused to hear an appeal from South Carolina, which wanted to trademark a baseball cap logo with the initials “SC.”