The domain name industry report from Nominet: Issue Q4 2011
As broadband penetration in the UK grows, and with the launch of the much anticipated 4G service, internet usage in the UK is on a steep upward trend.
Recent figures from the Office for National Statistics have shown that usage has doubled in the last six years and that in 2012 two thirds of adults accessed the internet at least once per day. Email is the most common activity on-line, followed by shopping and banking. Currently only 6% of Brits have their own website or blog, and this is an area of huge potential growth.
Phil Kingsland Director of Marketing and Communications
Internet usage in the UK has doubled in recent years and our internet economy is a bigger proportion of our GDP than any other G20 nation which is very positive news for those of us involved in the UK domain name industry.
The nature of the .uk registry has played a significant role in growing the internet economy; its credibility and reliability means that consumers have the confidence to purchase on line. In fact we’ve found that eight out of ten UK consumers prefer to buy from a .uk website and it is the most trusted domain in the country.
We now have well over 10 million domains on the registry and anticipate seeing this number continue to grow just as consumer demand continues to grow. With new gTLDs about to hit the market, the UK consumer is going to be faced with a raft of choices when it comes to domains, whether they are browsing and purchasing from web sites or they are looking to register their own name. Familiarity, relevance, trust and confidence will continue to be key factors in the success of the .uk namespace.
Nearly 2 million new .uk domains were registered in 2012
The .uk registry maintains its position as the fifth biggest registry in the world, behind .com, .de, .net and .tk. Having passed the 10 million domains landmark in March 2012, by the end of 2012 the number of .uk domains stood at 10,301,331. The slowing growth rate is partly due to the maturing market, expiring promotional domains with a lower renewal rate and increasing competition in the marketplace with growing consumer awareness of other TLD offerings in the UK. With the launch of the new gTLDs we expect to see the .uk register continue to grow at a conservative pace but the increased choice for consumers will undoubtedly impact the uptake of new .uk domains.
.uk grows faster than .de and .net
TLD annual growth rate
With the exception of .tk which benefits from an aggressive free domain business model the top TLDs appear to have reached maturity and as such their growth rates have slowed significantly in recent years. .uk has seen the steepest decline in growth rate in the past year, dropping from +9.4% (2011 vs 2010) to +4.6% (2012 vs 2011) but this rate is still higher than .de and .net which both saw growth of +3.7% year on year. Increased competition from the new gTLDs in 2013 and 2014 will impact new registrations across all existing TLDs but the established reputation of the top five registries should ensure their continued growth.
Nearly two million new .uk domains registered in 2012
Annual new .uk registrations
The number of new .uk registrations in 2012 was 1.98 million, just under the two million levels seen in 2010 and 2011; overall the year on year decline of new registrations was -4.8%. With the launch of the new gTLDs just around the corner being mitigated by increased marketing support for .uk we anticipate the new registrations levels to flatten out at this level of around two million per year. The start of 2013 has reinforced this prediction with new registrations at the same level as January 2011.
.co.uk is almost 93% of the total .uk register
New registrations by SLD
.co.uk is by far the largest Second Level Domain (SLD) in the .uk portfolio, accounting for 94% of all new registrations in 2012. .org.uk, the non-commercial SLD is the second largest with just under 5% of new registrations and .me.uk is the next most popular choice with just under 1% of all new registrations. In total on the register .co.uk domains are 92.6% of the total and .org.uk are 5.8%.
The other SLD options (.plc.uk, .ltd.uk, .sch.uk and .net.uk) are targeted at niche markets with specific registration rules and so have considerably smaller registration numbers. The number of .sch.uk domains on the register is over 35,000 – with the total number of schools in the country estimated at between 30-40 thousand, this domain clearly has a very high penetration level.
Promotional domains impact renewal rates
Monthly renewal rates
Monthly renewal rates for .uk domains have been impacted by the maturity of promotional domains in the last twelve months and we’ve seen that when a domain is registered on impulse it is less likely to be renewed. Removing these promotional domain campaigns from the renewals picture shows an average renewal rate of around 70% which is in line with the strong rates seen at the start of 2008.
Renewal rates correlate to the age of the domain
Age of domain at renewal
As you would expect the longer a domain has been registered, and so the more established the website at that address is, the higher the likelihood of it being renewed.
Domains between three to four years old follow the average renewals rates of around 70% and this increases up to over 90% for domains aged 10 years and over. The lowest renewal rates are seen for domains aged less than two years old and here we can clearly see the impact of promotional domains which are registered on impulse and often without a clear plan for usage. Nearly half of these domains lapse once the initial registration period is over indicating that these new registrants need more support during the renewals period to encourage them not to let the domain lapse.