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Russia Deep-Dive 1/2

May 25th, 2009 2 comments

That small one is asking to be lostI like Russian domains, in fact I wish I had more. My portfolio of Cyrillic (link) domains in terms of numbers is rather modest, in fact the smallest of all the languages I hold.

Deep-Dives

If you have read Chapters 2-3 already, then you will appreciate that we have already laid out a watertight case for IDN’s on a macro level, but I have been saying throughout these posts – that all things are not equal, you need to drop down a level and take a look at Languages and Countries.

No Russian no matter

So before I go making an idiot of myself, a few things to note; I’ve never been to Russia, and I can’t read, write or speak Russian.
The best qualifications I can lay claim to is that I’ve watched From Russia With Love more times than I can remember.

So I will spare you the indignity of reading my copying n pasting from Wikipedia, making out I know stuff when I don’t. If you want to know more about the Cyrillic Language and Russia as a country, then I suggest you go Google it.

This is the beauty of the age we live in today; you’d think I would be severely handicapped not having any foreign language skills, yet I can still hold my own in this space.

  • There are a wealth of free and paid translation tools and professional services out there
  • There is a plethora of bi-lingual students looking to earn a few $’s that are only an MSN away
  • There are plenty of native Russian domainers in forums like IDNforums that often offer assistance if you ask nicely
  • And if you are looking for something more tangible, then striking a partnership up with a native domainer can pay serious dividends. Partnering may not be for everyones tastes, but I’m sure there would be opportunities a-plenty; definitely worth considering.

One of the barriers to entry into IDN I hear quoted a lot, is simply the language, particularly in relation to monetizing the domains.

I’ll cover monetization in a dedicated post, but for now a few things to consider:

You don’t need any language skills to park a domain.

But domain parking is as we know on it’s knees, and mini-sites well, i’m not convinced.
We all know that to squeeze the $ out of a domain, it has to be developed properly. And if domainers don’t have technical skills to develop properly, then you are going to need to pay someone to do it.

This is the direction I think domaining will go – I think we’ll see many resource & revenue partnerships forming where:
A guy with domain and no advanced technical skills + a guy with no domain but has real web design skills = the best monetization solution.

So if someone else is going to be writing the content and developing, then it makes no difference what language this is in, it’s just a case of partnering with the right person. If like me, you’ve ever used Elance or GetAFreelancer for project work, the most bids for jobs you’ve received are probably from Russian coders anyway.

So with everything I’ve said above, I’ll spare you the language and geography lessons, and just stick to giving you the facts.

Russian Language Domains

When looking at one particular language of IDN and deciding if it is ripe for investment (either as a domainer or end user) – I’ve found it’s useful to use a series of score-cards to capture the key points.

Country

GDP: $15,800
Online advertising spend 2008: $590m (up 55% on 2007)
Online advertising spend forecast 2010: ~$1bn
Population: 140m
Internet Penetration 2008: 47m users
Internet Penetration Trend: The number of Internet users in Russia in 2009 will grow by 34 percent compared to 2008 year

Language

English Speaking: 4.9%
Total Russian Speakers: ~300m
Cyrillic Language used in countries other than Russia

Social, Domestic & Political

Scuffles with Georgia, but not war torn
No nasty government firewall like China has

As I glance over these crude scorecards it’s clear there’s an opportunity for IDN in the Russian internet, and there’s money being spent online and a huge amount of growth to come as the trend continues to climb sharply. Russia as a country is also getting excited about IDN – you can see the buzz in the media coverage it is getting almost every day.

That’s nice, so Russia is hot for IDN.

ccTLD vs com

When writing about IDN, I have almost constantly been referring to .com’s.
To set the record straight, I am not a .com fan-boy, in fact in one Language I have as many ccTLD as I do .com; but I continue to see some people I know back the .com horse, others the country code horse; and they will argue which is best and why, until the cows come home.

My attitude is, back the one that makes sense. If they both make sense, then back both.

What makes sense for Russia?

It is no secret that today Russia’s country code (.ru) is considerably more popular than .com

cctld vs com
Link

Today you cannot register IDN’s under the .ru ccTLD, but in introducing an IDN ccTLD to Russia; then the equivalent of the popular .ru would make a lot of sense. It would draw on the mindset of the existing Russian internet community, and the battle to win hearts and minds and get that all important memorability & recall would be so much easier.

We knew this for years, yet a lot of people invested in Russian .com IDN’s. Why?

What we also knew was that to complete the IDN work and “IDN the extension”, Russians would be denied their 1st, and obvious choice. Why?

Paraguay

In Russian language (the Cyrillic characters) for .ru are .ру

yes, that .ру, looks like it’s English. You’ve got to zoom right in to tell the difference.
On the left is the Cyrillic equivalent of .ru, on the right are the English letters .py py or py

And if a Russian ccTLD .ру was ever sanctioned by ICANN, then I have no doubt in my mind it would have crushed any chance of .com becoming a contender for top-dog.

But it was never going to happen, because it looks too much like Paraguay’s ccTLD.

So instead, after much debate they opted for a completely new extension .рф
It is the Russian Cyrillic equivalent for .rf (Russian Federation). That’s pretty lame by all accounts, and from the Russian domainers I have spoken to, it’s actually quite a stinker.

Cyprus

There is another ascii ccTLD is use today, .su (stands for Soviet Union) and has allowed IDN registration since 2008, but again there is a problem, a few in fact – ICANN have been wanting to decommission it for some time as the Soviet Union (USSR) no longer exists.
cy or cyThe final nail it the coffin is that the Cyrillic equivalent of the existing .su is .су and that looks to much like Cyprus’s ccTLD. So it’s never going to be a full-IDN.

Oh dear, not having a lot of luck are they.

The Contenders

So when we look at domain extensions in Russia there are 4 contenders:

.ru : this doesn’t allow IDN registration, but is the most popular extension today, but can’t have it’s cousin (.ру) enabled

.su : this does allow IDN, but cannot have its equivalent .су enabled

.рф : which will allow IDN only, but has the same tough job that all new extensions face

.com; which allows ascii and IDN, and if you read Chapter 3 you will have seen that .com is destined to have an aliased IDN version, probably the Cyrillic characters .ком

If you consider a full IDN (domain name and extension in Cyrillic) is critical to the success of an IDN extension, then we can whittle the 4 down to 2.

The short list

Which leaves us with .рф which is enjoying lots of media attention, but because it is brand new has the uphill battle to gain mindset.

And .ком which in it’s (.com) form for has been around forever and has trust and mindset well ingrained.

There is always room for more than 1 successful extension, so we don’t need to try and agree who will win a popularity contest between .рф (.rf) and .ком (.com)…

… but it is worth a closer look, to see if there is anything else here, any further opportunities.

Mr GreedyGreedy people

Today when you see a new extension released, greed runs through it like a fat vein, with all sorts of rules of what domains are available, what is not available, and what is held hostage to the highest bidder.

.рф is no different, they have already announced that the government will be keeping hostage geographic terms and names “the State needs”. Then the State authorities take a slice, then the Federal Executive Bodies and so on.. somewhere in all this Trademark owners (legitimate or otherwise) get a go too.

Ok, so the government and the TM holders take their slices, and then it’s general registration for everyone.

What is the cost of a domain on day 1?

1million Rubles (approx $30,000) 10million Rubles (approx $300,000). They will be running a Dutch auction where each day the price decreases.

Of course there will be a minimum character length limit as with all ccTLD’s, and you’ll need a Russian passport to buy one.

Then of course will come the accusations of corruption and cheating… and so on.

The regular guy, be him a domainer or an end user will have to make do with whatever crumbs are left.

.рф will be like all the other extensions we have seen launch recently.

What about .com?

Well, Russian IDN.com’s became available for registration in 2001. In those good-ole-days before everyone became obese, there were no rules, restrictions or hostage taking.

There was no minimum length. In fact all of these single alphabet letters belong to someone.

All of the geographical cities and states belong to someone.

can't be assed to type .com?  Opera.. music to domainers ears

If you’re a savvy domainer, then you’ll have heard of the Opera effect.
Type your term into the address bar without the extension, hit enter and you land on the term+.com website.

..and?

Browser usage in Russia

Browser usage in Russia

For whatever reason, Opera is the 2nd most popular browser in Russia (link)

The fact that Opera works like this and that Russia use Opera a lot, will no doubt increase “type-in” traffic; but the ever increasing traffic levels being reported by many domainers to their Russian domains cannot only be due to the Opera effect. I have a few Russian IDN’s in .net, and they too receive constant traffic. I am more inclined to think that it is at least partly due to the publicity and awareness taking place.

Traffic

Last time I promised you a screenshot of some traffic to a Russian IDN.
Disclaimer: I do not own this domain. But the owner has very kindly allowed me to show it.

Now, before you click to zoom in, consider this:

Half of MarchHalf of April

At the time this traffic was being measured, the domain was not parked, it had no website, in fact if you were to visit the page you’d just see what’s known as a directory listing. The traffic stats record almost 60,000 horny* visitors over a 1 month period (Mid March to End of April), before DNS was changed again and the stat recording ceased.

* The domain is порно.com (“Porno” in Russian Cyrillic)

Conclusion

To repeat my first few words of this post: I like Russian domains…

particularly .com (.ком)

  • I like the way that Russia is a huge country, and extremely wealthy in parts
  • I like the fact that Russia need IDN
  • I like that they are excited about IDN
  • I like the enormous projected growth in online spend
  • I like that Russia’s first IDN ccTLD is going to struggle, giving way for opportunity in .com
  • I like that in heavily publicising IDN ccTLD in Russia, it spreads the word generally
  • I like that Verisign will be aliasing .com to an IDN version
  • I like that there is traffic to .com already, and in some cases considerable traffic
  • I like the fact traffic is trending upwards

Russian IDN’s are definitely smokin'

… I just wish I had a few more.

Next up

In the 2nd and final part of our Russian deep-dive, we head West for a date with making history; as we discover that for this story it is not the end, but rather – the end of the beginning.

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