market trends seminar

1VeriSign Confidential & Proprietary

Market Trends Seminar

ICANN Luxembourg

July 2005

VeriSign, Inc.VeriSign Confidential & Proprietary

2

Overview

• Key Metrics for the Domain Name Industry

• Key Drivers of the Business Currently

• Trends in Registrar Behavior

• Going Forward


3

Metric: Domain Name Base

• 22% Increase

YOY

• 8% Increase

QOQ

• .info Had the Highest

Base Growth % Increase YOY at 199%


4

Industry Composition

• Com at 47%

• ccTLDs in Total are 35%

• Not Much

Change over Past 2

Years.


5

ccTLD growth

• 27M Registrations

• 8% Increase in Base

Growth YOY

• 6% Increase in Base

Growth QOQ

• Top 10 ccTLDs make

up 70%


6

Metric: New Registrations

• 6.7M New Registrations in Q1

2005

• 4% Growth QOQ

• 36% Growth YOY

• YOY ccTLD New Registrations grew by 62.5%; CN by 31% and

the other gTLDs by 9.5%


7

Metric: Renewal Rates COM NET

74%76% 77% 78% 77%

79% 80%83%

80%

55%

60% 60% 61% 62% 62%64%

68%

50%

40%

60%

80%

100%

Q1 03 Q2 03 Q3 03 Q4 03 Q1 04 Q2 04 Q3 04 Q4 04 Q1 05

1st Time Expiring Names

Average Renewal Rate

Previously Renewed Expiring Names

Stability in the Name Base

74.5% Average Renewal rate


8

75.0%

55.0%

76.0%

0%

20%

40%

60%

80%

100%

2002 2003 2004

Metric: Names Associated with Website COM NET

Source: Cyveillence 2004

Highest usage ever

Names Associated with Website

Higher usage = higher renewals


9

Driver: PPC Impact On Domain Market

“The key to remember on a $7 domain is that if it makes more than 2 cents a day it is profitable at the end of the year.”

Adam Dicker, CEO, High Impact Sites, Inc.


10

Key Takeaway: PPC market is driving domain name registration growth as domain names are registered that contain meaningful terms or attract traffic. Registrants generate revenue by enhancing resale value or by placing PPC advertising on a parked page.

Driver: Paid Search – PPC Market

Source: Jupiter Research as cited in Wired News October 2004


11

Driver: Broadband Penetration


12

Domain Name Market (ccTLDs and Com Net)

Blue = COM NET %Red = ccTLD %

Source: Zooknic, Inc., December 2004

•Composition Shift in total com/net

registration reliance from NA from 68% in

2002 to 61% in 2005.

•Asia Pac increased contribution to total

com/net registrations from 9% - 12% in same

time period.

•76% in 2004 – 73% of registered ccTLDs are

European


13

Trends in Registrar Behavior

• Participation in the PPC Market

• Bundling & Packaging:+ Hosting services

+ Blogging

+ ccTLD & gTLD domain names

• International Expansion into upcoming areas by sellers


14

Com Net ICANN-accredited Registrar Locations

Source: VeriSign internal data. November 2004


15

Thank you!

Sarah Langstone

[email protected]


16

Thank You

Any Questions?

Sarah Langstone

[email protected]

market trends seminar

Documents