Trefis is a financial analysis site, they describe themselves as an interactive financial community structured around trends, forecasts and insights related to some of the most popular stocks in the US. They wrote about Verisign yesterday and whether or not they can maintain their growth.
They note that .com has built such a niche that it has been able to stand the test of competition, in their estimation .net is not and they believe the new gtld program has affected .net in a negative way.
From the article:
A major factor adversely impacting the .net growth was introduction of a new gTLD program which gained around 2.8 million registrations until now. Additionally, there is confusion involving the domain names for the new gTLDs, and .net is being adversely impacted by that as well. Conversely, .com being a well established brand has created a niche in the market which is comparatively more resilient to competition, than the .net brand. However, the .com domain name has become increasingly saturated in recent years, causing limits to new additions. In the second quarter, 1.15 million net names were added to the domain name base after processing 8.7 million new gross registrations.
They continue to focus on .net and state they believe Verisign needs to work with registrars committed to the .net brand. That seems like a tough sell imo. They look at whether another price hike is feasible ?
In Q3 2014, VeriSign’s .net brand witnessed yet another flat quarter and the demand might further slow down with the hike in prices from $6.18 to $6.79 scheduled for February 2015. The company is trying to make up for the lack of volume growth in the .net domain, with an increase in price to generate more revenue. However, the plan might not be sustainable in the long run. Not only will it decelerate the .net demand even further but with the increased influx of competition, the existing users might decide to switch loyalties.
A survey was recently conducted by Research Now (on behalf of the Domain Name Association) to understand receptiveness towards new domain name extensions. The research included 7 countries, namely, Australia, China, India, Russia, Turkey, UK and US. It showed a receptiveness towards new domain name additions, especially in developing countries with high internet penetration, like India and China. The choices offered were .com, .ccTLD, and new gTLD options. The results revealed preference towards the first two. However, the survey also indicated a willingness to trust new gTLDs with industry associated words, such as, ‘worldco.international’. [1]. Hence, the confusion regarding new gTLDs might be alleviated in the future and the new gTLDs might capture a significant portion of the market putting VeriSign’s market dominance at risk.
Read the full article on Trefis
