.Com growth rate slowing (but only slightly)

Data show a slight reduction in .com growth rate, but it’s still over 8% per year.

A couple weeks ago Michael Berkens wrote a story about how the base of .com and .net domain registrations was slowing “to a crawl”.

A few days later Treffis issued a report stating “Verisign’s Dropping .com And .net Is A Troubling Trend”.

The numbers in Berken’s post didn’t quite make sense to me. The Treffis report refers to .com and .net having a falling market share, which doesn’t seem particularly relevant with the overall namespace continuing to grow.

Curious what the real story is, I decided to dig into the numbers.

The most important thing I discovered is that the numbers some people compare aren’t always apples to apples. What VeriSign reports on its zone file page differ from what’s in its domain industry briefs and investor calls, which also differ from the numbers it reports to ICANN each month. For example, the numbers in the quarterly reports and domain briefs exclude domains in the 5 day add-grace period.

If you compare numbers in the zone file to VeriSign’s other reports, you’ll get the wrong growth rates.

Perhaps the best monthly source of information on .com registrations are the monthly reports VeriSign sends to ICANN. They’re easy to access and the archive goes back as far as you want to go.

So to compare apples to apples, I pulled the end-of-quarter monthly ICANN reports going back to Q1 2009. I looked only at .com.

Here’s what I found: the growth rate of the .com registration base is slowing marginally over the past few years.

The chart above shows the annual growth rate in the .com base. As you case see, it’s been on a slight downward projectory since Q3 of 2010. It’s never good to go down, but the drop (in growth rate, not total domains registered) has been as little as three basis points from one quarter to the next and no more than 25 basis points. It’s also coming off a nice peak following a hard period due to falling domain parking revenue.

Also keep in mind that the bigger the base gets, the more domains must be added just to maintain the same growth rate. The number of net gains in 2011 exceeded 2010 despite a slower overall growth rate.

It may be helpful to look at the .com base, as reported to ICANN, since Q1 2009 on a chart that begins at zero:

Trying to compare the growth rate in the .com base from quarter to quarter (instead of annually) is a bit challenging. Domain registrations are seasonal. Q1 is consistently a strong quarter for growth.

It’s best to represent this data in a table:

You can still see the slight downward trend in these numbers.

Bottom line: growth in the .com base is slowing, but ever so slightly. And it’s still growing significantly.

The downside to VeriSign’s data submitted to ICANN is that it is posted three months in arrears. Some sites that track .com counts on zone information show that the reduced growth trend is continuing.

Many new TLD supporters think that a proliferation of alternatives to .com will take a bite out of .com’s growth rate. They could be right in the long term. But for now, the registration base of .com continues to grow nicely.

Comments

  1. Jay says

    “Some sites” – You have this link from comment at Michael Berkens’ post, so you should at least give credit to that person who posted it…

  2. says

    Andrew

    The post I made cited the current zone file stats that Verisign publishes daily.

    https://www.verisigninc.com/en_US/products-and-services/domain-name-services/grow-your-domain-name-business/tld-zone-access/index.xhtml?loc=en_US

    Your report is based on as you say older information only through June 30, 2012

    My info as based on the numbers Verisign reported on the date of the post

    As of today October 17th now 3/12 months after the last Verisign report there are 105,109,941 .com’s in the active file and 143,421 in the not configured file or a total of around 105,250,000 domains.

    If you at the .com base chart you published you will see that the line as of June 30, 2012 is right about at 105M domains, (since you didn’t publish actual numbers) the same amount of .com that exist today 3 1/2 months later.

    I stand by my post .com growth has slowed to a crawl unless the numbers posted daily by Verisign are inaccurate which I have no control of.

    • says

      Michael, your post cites the numbers in the current zone file and compares it to the amount reported in one of VeriSign’s domain briefs. It’s an apples to oranges comparison. They calculate the numbers differently.

      It’s possible that the base is slowing, but the numbers you provided don’t show that.

      FYI, VeriSign thinks it will add between 1.6 million and 1.9 million .com/.net to the base in Q3. We’ll see if they hit it.

  3. Matty says

    They are going to have to get a shift on to hit those targets. Jul & Aug combined look to be just over 700k.

    Annually as @ end of Q2 2012 they look to be +7.8m, 8.2%. Annually Q2 2011 was +7.5m, 8.5%.

    Although if comparisons are to be made by how other TLDs are fairing, from what I can see the main ones, apart from .biz, are seeing a drop in growth volumes annually. Which could suggest .com is in a healthy position in the current market.

    Being statistics i’ll let you all draw your own conclusions.

  4. says

    Its really hard to find a decent name in the .com sector, you also see many people registering .co, .ly, .io and many other extensions so its not surprising to see the growth rate slow.

  5. ImageAuthors says

    It’s a relief to read an article by somebody who has a good grasp of what kind of inferences are invalid. Statistics get bandied about so loosely. Thanks!

  6. says

    So many .com’s have been taken that it is hard to find a good name even for small business coming online their name has been taken in some form or other and being used as a blog and or even a personal page. With so many new extensions that have shown up it’s no wonder .com are slowing down in sales. Thank you for the post.

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