Domain Name Registrations Reach Record

The boom is back for Internet domain-name registration, but this time businesses and individuals are acting less like speculators and more like legitimate users with their Web addresses.

New domain-name registrations reached their highest quarterly level during the first three months of this year, beating out a previous peak reached in the second quarter of 2000, reported VeriSign Inc. on Monday.

A total of 4.7 million new domain names were registered in the first quarter of this year, bringing the total to a record of 63 million. That marked a 21 percent increase in registered domain names over the same period a year ago and a 5 percent rise over the last quarter of 2003, according to VeriSign's domain-name report.

"Looking back, we've not seen this kind of growth since the speculative bubble," said Raynor Dahlquist, acting vice president of naming services at VeriSign, the Mountain View, Calif., registry that manages the .com and .net domains.

The height of domain name speculation came in the second quarter of 2000 when about 4.5 million new domain names were registered, Dahlquist said. At that time, much of the boom in registrations resulted from individuals and businesses stockpiling domain names, often in an attempt to resell sought-after ones for a profit.

The latest resurgence in registrations, though, appears to be a result of an improving economy as well as greater use of the Internet, Dahlquist said. It comes as more domain names are resolving to an active site, signaling a move away from the speculative buying during the dot-com era, she said.

Within the .com and .net domains, the percentage of names associated with live Web sites has increased over the past 12 months from 61 percent to 64 percent. Compare that to December 2002, when 55 percent of domain names matched a live site. Meanwhile parked Web sites, those associated with a domain name but not actively being used, have dropped from 12 percent of names to 8 percent over the past 12 months, VeriSign reported.

At the end of the first quarter, the .com domain remained the most popular, accounting for 45 percent of registered names. The country code domains .de (Germany) and .uk (United Kingdom) followed in the second and third tops spots, respectively, while the .net domain was fourth.

VeriSign's contract for managing the .net domain is due to expire next year, and the Internet Corporation for Assigned Names and Numbers, which oversees the domain name system, is developing a process for opening that domain to bidders. VeriSign also challenging ICANN's authority in a lawsuit against the non-profit organization.

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