DomainInvesting.com

While I am away for DomainFest Global, I asked a couple of industry friends to write guest posts for my blog.   My preference was to write about something with which I am not familiar, to help me learn as well.   Today’s guest post is from Jeff Behrendt of INForum.in, the leading Indian domain forum.   As I mentioned previously, I don’t own any cctld domains, but after my honeymoon in Europe, I learned how widely used they are, and I think .in domain names are at the very top.

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I think that for many domainers who got into the industry late, country code domains are an attractive investment. The development and use of many of these ccTLDs is at a similar stage to where .com was several years ago. Unlike hyped extensions such as .mobi or .asia, country code domains really have endusers who buy them and use them. Plus, many country code “brands” are widely marketed in their respective countries and appeal to people’s patriotic feelings.

I invest in several country code domains, but the one I am most excited about is India. After years of heavy restrictions, in 2005 the Indian domain space was liberalized and it became cheap, easy and open to people internationally to register Indian domains. Since then there has been rapid growth: in February 2005 there were about 75,000 Indian domains registered, in November 2006, there were about 200,000 registered, in June 2007 there were about 250,000 registered, and in February 2008 there were about 400,000 registered.

Several other things make me excited about Indian domains. The first is the low Internet penetration in India. Right now there are over 60 million Internet users in India, which sounds like a large number. However, Internet penetration is only 4% – compared to 72% in the US. This leaves room for incredible growth and indeed Internet penetration is growing rapidly.

Another exciting thing about Indian domains is the large population of India. With a population of over 1.1 billion people, over the next few years, there will be more Internet users in India than in the United States.

One other big advantage of investing in Indian domains is the fact that English is the main language of business and government in India. This makes it a lot easier for most Americans (and Canadian, Brits, Australians, etc) to invest in than most other country’s domains. It is important to be careful though – the English spoken in India is somewhat different than standard American English.

As well, it is still early days. It is still possible to spend some time doing research and hand registering a decent Indian domain. This makes it easier for new domainers to get started.

Finally, the economy in India is booming. While economic growth has slowed over the last year, as it has across the globe, there is no recession in India and the economy there continues to grow at rates faster than American boom times.

Even Godaddy has noticed all of this, and recently they started offering Indian domain registration.

If you do choose to invest in Indian domains, there are two main extensions that you can invest in: .in and .co.in. .co.in is the one that had been traditionally used until 2005. Since then .in has gained traction and appears to be the more popular of the two. I have found that both .in and .co.in domains receive type in traffic. However, reseller and end user sales tend to be dominated by .in.

It is harder to monetize Indian domains than .com domains. There is actually a fair bit of type in traffic received on quality Indian domains, and I have found that over time the type ins are increasing. However, the CPC from parking Indian domains is abysmally low. Many Indian domainers build out minisites on their domains. Ranking minisites in Google India is significantly easier (by an order of magnitude) than ranking in Google and can create a good source of traffic and revenue. As the Internet economy develops in Indian, the value of the traffic will increase.

You are not going to get rich overnight investing in Indian domains. Several of the domains that were registered in 2005 are now selling for low $x,xxx. Sales of Indian domains are gradually increasing over time. However, the market, both at the reseller and end user level, is not nearly as liquid as it is for .com domains. While I am seeing more and more interest by people looking to purchase Indian domains, I think that it is best to approach these investments as longer term investments.

All in all, if current trends continue, the future prospects for Indian domains are very bright. For anyone doing business in India – be it a small or medium sized business or the Indian branch of an international business – using a .in or .co.in domain is a logical choice. Over time, people in India are increasingly turning to this ccTLD, and there is still plenty of opportunity there for domainers.

P.S. If you are interested in learning more about Indian domains, feel free to join us at INForum.in, the Home of the Indian Domain Name Industry. We enjoy talking not only about Indian domains, but also about anything to do with Indian business, culture or the Internet in India. We have an active buy and sell marketplace as well.