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Companies losing $10 BILLION by ignoring new gTLDs — report

Kevin Murphy, April 11, 2017, 07:35:15 (UTC), Domain Registries

The world economy is “conservatively” losing out on almost $10 billion of annual revenue due to a lack of support for new gTLDs and internationalized domain names, according to an ICANN-commissioned research report.

The report, conducted by Analysys Mason for the semi-independent Universal Acceptance Steering Group, calculated that patchy new gTLD support means $3.6 billion of activity is lost, with lack of IDN support costing $6.2 billion.

Despite “new” gTLDs being around for a decade and a half, there are still plenty of web sites and apps that incorrectly assume that all TLDs are either two or three characters. Others don’t support non-Latin scripts.

This leads to internet users abandoning transactions, the report says, when their email addresses are rejected as invalid.

Mason calculated the $3.6 billion number by multiplying the estimated number of email addresses using new gTLD domains (152 million) by the estimated average annual revenue generated per email address ($360), then calculating what portion of these transactions cannot happen due to incomplete TLD support.

Earlier research by .CLUB Domains suggests that 13% of sites do not support new gTLDs, so that’s the number Mason used. The researchers then cut the number in half, to account for the 50% of people it reckons would simply switch to an email address in a legacy TLD name.

That gets you to $3.6 billion of potential revenue lost for want of gTLD support.

Another, more cynical way to spin this would be to say that new gTLDs are causing $3.6 billion of economic damage. After all, if everyone were to use legacy TLDs there would be no problem.

For the IDN number, Mason calculated how many users of five major language groups (Russian, Chinese, Arabic, Vietnamese and Indian languages) are not currently online, then estimated how much revenue would be generated if just 5% of these users (17 million people) were persuaded online by the existences of IDN TLDs.

The report was commissioned in order to raise awareness of the financial benefits of universal acceptance.

The UASG has spent most of its efforts so far focusing on UA as a “bug fix” to be communicated to engineers, so the report is intended to broaden its message to catch the attention of the money people too.

The report, which goes into much more detail about how the numbers were arrived at, can be downloaded here.

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Comments (11)

  1. Snoopy says:

    Endusers need to be educated on the risks of using new tlds as part of email addresses. Still I don’t believe that 143 million people use ntlds for email, they are barely used at all.

  2. Will says:

    Was there a real $3.6 billion loss of revenue to the “world economy”? Did ALL that demand for products and services just dry up because emails or web searches did not go to companies with certain GTLDs or IDNs?
    NO. That money just flowed to the owners of websites with more easily reachable email addresses or to local brick and mortar businesses.
    Understanably it will take time for the world to learn, adjust and recode website forms, etc to accept newer TLDs. But the business will still go on.
    A man’s gotta do what a man’s gotta do.

  3. Can’t take a report seriously when the PDF is on an obscure .tech domain name. Won’t bother downloading it. 🙂

    It seems like sour grapes from an organization that can’t afford a decent .com.

    • Kevin Murphy says:

      The UASG is volunteer driven and funded by ICANN. Are you suggesting that ICANN cannot afford a decent .com? I beg to differ.

    • Rubens Kuhl says:

      ICANN could afford any non-premium domain name in any TLD for the UASG… their decision to settle on a new gTLD was deliberate.

      • Snoopy says:

        There is a difference between having a lot of money and being willing to spent it on something. They probably disclosed their domain budget of 99 cents for this “important project”, realized they couldn’t get a .com for that and took it from there.

  4. The numbers in the paper look like Social Science numbers. 13 e-mail addresses per domain? The spammers must really skew the metrics then! The whole user count/domain thing in this paper is seriously broken.

    • Kevin Murphy says:

      Some of the assumptions in this paper did strike me as on the high side, including the email address count.

      • It does highlight the flaw of the ICANN stakeholder model in that at its worst it is “Something must be done. This is something.” This report does make for big scary headlines for the media though.

        The most helpful way of solving a lot of the e-mail acceptance problem would be to create Open Source code fragments for Javascript, PHP and ASP that allow new gTLD domains to be properly parsed along with the legacy and ccTLDs.

        • Kevin Murphy says:

          I was pretty sure ICANN had already released source code along these lines, years ago, but I couldn’t find it with a quick search today.

  5. Jean De La Fuentes says:

    This is a much better prank for April 1 than yours Kevin …

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