Digital real estate: how Caribbean islands can cash in on their country codes

Every Caribbean country has its own unique footprint on the internet, thanks to its domain name. Saint Lucian sites are instantly recognisable from their ‘.lc’, Jamaica is identified by ‘.jm’, and Grenada by ‘.gd’. Known as country code Top-Level Domains (ccTLDs), there are more to these handles than just a convenient means of finding your way around the web.

These pieces of digital real estate are increasingly becoming more valuable as the traditional ‘.com’ falls out of fashion, and can be leveraged into important revenue streams for Caribbean governments – as evidenced by the growing success of Anguilla’s ccTLD.

Alternative addresses

When it comes to monetising Caribbean country codes, Anguilla is the region’s unrivalled success story. By riding an emerging tech trend, Anguilla brought in millions in domain name revenue as its coveted ‘.ai’ caught the eye of Silicon Valley start-ups.

In 2018 Anguilla received just over EC$ 7.8mn from registration of the ‘.ai’ domain – taking a cut each time the domain was registered or renewed. According to Nominet UK, there are over 40,000 ‘.ai’ domains currently registered (for comparison, Saint Lucia’s ‘.lc’ totalled 3,823 in 2018).

Demand for Anguilla’s ccTLD more than doubled from 2017, when it brought in just under EC$2.7 million, to 2018. This sudden surge in the market can be explained by the emergence of Artificial Intelligence seed companies. Sites are being snapped up by AI start-ups themselves or by speculators hoping to jump on the trend and resell them for inflated prices as the market heats up.

Since 2014 the number of start-ups choosing options other than ‘.com’ has more than doubled, with ‘.io’ and ‘.co’ growing in popularity. Anguilla’s highly desirable ‘.ai’ nudged out ‘.net’ as the third most popular alternative domain in 2018, according to US credit card firm Brex which surveyed over 3,000 start-ups.

Brex found that funding was a factor in explaining this explosion in alternative domains as seed stage companies with a ‘.ai’ address attract 3.5 times the average funding of a company with a standard ‘.com’ domain. According to Brex, the Anguilla sign-off was most popular in California, the home of Silicon Valley.

While Anguilla enjoys its newfound fame among the tech world, other Caribbean countries have the potential to follow suit. Data from Nominet show that, after Anguilla, the region’s top three country codes in 2018 belonged to Belize, whose ‘.bz’ attracts businesses and has racked up 31,508 domains; the Dominican Republic which operates ‘.do’ and has 28,850 sites with that tagline; and St Vincent and the Grenadines which has 22,487 domains with the ‘.vc’ handle – particularly appealing to venture capitalist firms.

Other opportunities are out there for countries wanting to find their ccTLD niche. Saint Lucia could attract limited companies, Antigua and Barbuda’s ‘.ag’ has potential in the German market where ag is a known shorthand for certain corporations, Montserrat might target Microsoft entities with its ‘.ms’. There are also opportunities closer to home as Caribbean entrepreneurs use their own country codes as part of their online branding.

Policy concerns and considerations

But before the Caribbean can fully exploit this market, it must first get its house in order. Thanks to the haphazard nature of the region’s digital development, there is little harmonisation across the region concerning ccTLDs and how they are managed.

In the early days of the internet, Caribbean countries connected through an exchange point located in Puerto Rico. While the Puerto Rico Internet Exchange ceased operations in 2011, many Caribbean islands still have Puerto Rico stakeholders listed as their ccTLD managers today. For example, Saint Lucia’s ccTLD manager is the University of Puerto Rico.

Others are managed by government or private entities but the most progressive islands have adopted a new model – the Multi-stakeholder Advisory Group (MAG) – and have been supported and guided in these efforts by the Internet Corporation for Assigned Names and Numbers (ICANN).

Senior Manager for ICANN Stakeholder Engagement for the Caribbean, and a former manager of Saint Lucia’s ccTLD, Albert Daniels says: “Most islands started with Puerto Rico; some have redesignated but Saint Lucia has not crossed that final step. Trinidad and Tobago are in the lead with this. Other countries in the Caribbean have different MAGs, some do not have a MAG at all. You have a broad spectrum of models in the Caribbean.

“I encourage [other countries] to look at Trinidad and Tobago and see how well it is working. The multi-stakeholder grouping decides what the policies should be and how it is run. You do not have one person deciding everything. Countries need to organise themselves and get a MAG going so they have the representation of all stakeholders.”

Without the right framework in place, countries risk being unable to handle expansion of their ccTLDs. A resilient structure is vital if islands are going to make the most of this revenue. “You need to be able to scale,” says Daniels. “You need to have the technical and administrative capacity to deal with that kind of growth, and manage it when it comes.”

Timely trends

With the right infrastructure in place, ccTLDs can be a profitable niche for certain jurisdictions, but those yet to stake their claim in the market will have to move fast – the window is closing as technology moves on. While URLs were once the standard in navigating the internet, users are increasingly relying on search engines and apps as they surf, rather than remembering and retyping addresses into their browser.

In the fast-paced tech world, trends come and go, and oddball domain names are no exception. Demand for ‘.ai’ surged by 219 per cent from 2017-2018 as Artificial Intelligence hit its niche, but its continued popularity can’t be taken for granted. ‘.cc’ from the Cocos Islands was in high demand among creative companies but dropped 44 per cent in 2018. Similarly, Indonesia’s ‘.id’ attracted security and identity-related firms but shrunk by 80 per cent in 2018, according to Nominet.

And ccTLDs face stiff competition from generic TLDs, the list of which has expanded in recent years to incorporate new names such as ‘.hotel’ and ‘.bank’. “There is much more choice today,” says Daniels. “The bottom line is that there is broad competition right now so you really have to find a working niche and jump on it. That is the nature of the market. It is very diverse.”

So how can governments promote their country codes in such a crowded industry? “The same way any organisation would market any service,” says Daniels. “You look at what you are trying to sell and the market you are trying to reach. There is no hidden secret or special sauce.”

As the Caribbean moves to modernise its digital infrastructure, Daniels encourages countries to engage more with ICANN and related entities such as the Latin American and Caribbean Country Code Top-Level Domains Organization and Country Code Names Supporting Organisation to take advantage of the support and expertise offered by these bodies.