February 21, 2008

Huge Demand for Asian Domain

Huge demand is expected for the first Internet domain name extension dedicated to the Asia-Pacific region. DotAsia is the organization administering the new domain name suffix ".asia".

The .asia domain name includes 70 countries from the Middle East to Australia.  BBC News reports that 60% of the world's population lives within the region, including 400 million Internet users.

It was approved in 2006 after DotAsia began laying the groundwork in 2000 to create the new suffix.   

But some industry insiders worry about the proliferation of domain name suffixes, and fear that the business of buying domain names has become more about protecting brands than promoting them.

Since last October, companies have been able to reserve domains to match their trademarks.  Now, this so-called sunrise period has been opened up for anyone to register.  The first .asia domains are expected to go live on the Internet in March. 

Thomas Herbert, a product manager for Hostway, a UK hosting firm, told BBC News he believes the nature of buying domain names has changed, largely due to the lucrative businesses of cybersquatting.

"People are willing to pay big money for a domain and with domain name reselling on the increase, it has become a matter of protecting your trademark," he said.

In addition to cybersquatting there can be legitimate battles over domain names.

In Europe, there were some 95,000 conflicting claims for domain names during the sunrise period for the ".eu" suffix.   For example, Volkswagen, Ralph Lauren and Nestle had all applied for the www.polo.eu domain name.

However, DotAsia said it had established certain rules to limit disputes and cybersquatting.  For instance, companies must be already registered in the Asia/Pacific region to qualify for the .asia name, and if there are any conflicts of interest the domain will be auctioned off to the highest bidder.

Such restrictions are likely to increase as more domain names come online, Mr. Herbert said.

DotAsia spokeswoman Leona Chen said she anticipated plenty of interest and hoped the suffix could have as significant an impact in the Asia-Pacific region as .com has globally.

"We are ready for something big. All of our people and systems are in place and we look forward to the commencement of the .asia landrush," she said in a BBC News report.

In Britain, domain name registrar NetNames said the number of firms registering interest in the .asia suffix is considerably lower than for the eu domain in April 2006.

"Only 30,780 applications have been filed for .asia domain names so far compared with 330,000 at the same point in the launch of the .eu domain name," NetNames COO Jonathan Robinson told BBC News.

However, Robinson advised firms with interest in the domain name to move quickly.

"Once it starts, there's far less protection for companies' trademarks and its open season on the .asia domain name for cybersquatters, online speculators and competitors," he said.

According to a report from Nominet, the organization that oversaw the .uk registry, there is an active market in buying, selling and storing domain names, and sales regularly exceed $200,000 with peak values exceeding $2M.

Although some of these resales are genuine, there is a large market for speculators, said Lesley Cowley, Nominet's top executive, in a BBC News report.

Crowley is concerned that a sudden jump in the number of domain names could leave companies baffled as to which names they should register.

"The current process being developed by Icann (the Internet Corporation for Assigned Names and Numbers) means there could be a couple of hundred or even thousands of new suffixes to bid for by the end of the year," she said.

Additional regional suffixes for Latin America and Africa are expected to follow on the heels of the Asia-Pacific domain suffix.