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June 23, 2016

Can data mining help reverse the fortunes of DNS providers?

C-level briefing: The CEO of the UK’s largest online registry talks to CBR on how the industry has been disrupted and a GoDaddy approach could revive .uk, .co.uk.

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Internet domain names took off in 1983 with the Domain Name System being introduced on the Advanced Research Projects Agency Network (ARPANET).

In 2016, it is expected that the 300 millionth domain will be created. The UK has the world’s fourth largest footprint for a geographic domain, .uk, at 10.7 million as of March 2016, according to British company Nominet who is responsible for all .uk domains.

Tokelau (.tk) with 31.3 million, China (.cn) with 16.8 million and Germany (.de) with 16 million domains are the only countries with more domains. Yet, the use of .com has surpassed 123 million domains making it the most used due to its global reach.

Speaking to CBR, Nominet’s CEO Russell Haworth said that despite the large amount of .uk domains currently in use, the industry is very much flat and there is a need to reinvent it.

"The domain space is quite a dynamic place at the moment. What as an industry we have not done is to get to that point where people who are not techies can get online.

"The growth rates were high [in the past], but now have flattened. We are now actually in decline in terms of [domain] growth rates.

According to Haworth, the overall UK market, of which Nominet’s has a 55% of market share, "is flat to declining, but it has reached a level of maturity and saturation. Anyone that wants a domain can get it, in terms of price there are no barriers anymore."

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He explained that in essence, getting online has always been complicated. People buy a domain but then have questions around how they link it to a website and how do they ensure that website is optimised for search navigation.

The factor that most contributed to the decline of .uk, according to Haworth, was all the technology jargon around building a website from the ground up.

Haworth said: "We are at a point where now website developers like Wix, Weebly, etc, have come on the scene. Within half an hour you can get what it looks like an impressive looking website with, for example, ecommerce attached to it, social media, etc. Three, two years ago, you could not have done that.

"The industry has cut out tech jargon and tried to make websites more accessible to those trying to get a website."

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Elsewhere, for Nominet, the job now is to help the industry find where the new opportunities are in the UK and use resources that it already possesses, like data.

"We are working very much with industry bodies like Go On UK, and anybody that is connected to the SME industry, because that is where the opportunity is.

"The opportunity now is to go above the marketing strategy to become a lot more sophisticated on how we are using data.

"As an industry I do not think we have done that terribly well. We have not used data."

The company is working on a data project to, as Haworth said, "really look at very sophisticated data mining and try to understand how we can take the four billion DNS queries a day that come through our network."

"We get a really good insight on what is happening in the UK’s ecosystem from a domain stand point.

"We got all light data, data that is around domains and then we have all of the rest of peripheral data sets that we are starting to add so we can start doing more predictive analytics.

"This will allow us to learn more about how we improve renewal rates, how we improve targeted marketing to small businesses and to consumers to get the right message to improve domain sales."

He pointed to GoDaddy in order to explain how customer service today is a crucial aspect of the domain service, as well as the add-ons that have to be included in the domain name purchase.

Speaking to Harvard Business Review, GoDaddy’s CEO Blake Irving, said that the company’s strategy is all built around customers in order to offer them all they need.

Irving said: "it is all about our customers. It is about providing value. It is about living passionately. It is about working together and joining forces, and all those things that we think are going to make our customers happy."

According to Haworth, this is the way to invert the declining trend affecting .uk and .co.uk domains.

"We have used historically a lot of jargon, and now, as an industry, we are trying to make sure we are talking to the consumer in a way that they understand that providing a kind of all-in-one package, where you buy a website, then you get hosting, SSL certificates and a whole bunch of value added services, is the way. By the end of the day, it is a fairly commoditised market."

In the end, how do you differentiate? Haworth said that it is about marketing power to attract customers and it is about the value added service and good customer service.

"When you have a problem with your domain, you want to make sure you can pick up your phone and speak to someone to speak you through on how to tackle a problem on the website for example. That is how GoDaddy are approaching it, for example."

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