How to Get Started with IDNs – 14 Tips, Techniques and Resources

How does becoming wealthier than Frank Schilling sound? Schilling, the most successful individual domainer in the world, has a portfolio of about 300,000 names, estimated revenue of $20 million dollars per year, and has received several 9-figures offers for his portfolio. Yet according to long-time IDN investor and IDN expert David Wrixon, “[t]here are IDN investors out there that will make Frank Schilling look like an amateur.”

When it comes to making money in domaining, there are many strategies. But if you are looking to capitalize on one strategy that holds a lot of potential, you should check out IDNs. Although you may never be as successful as Schilling, the timing for getting into IDNs is good.

What is an IDN?

IDN stands for “International Domain Name.” The normal domains that you are used to using are all written with the standard ASCII characters with which we are familiar – the letters A to Z, the numbers 0 to 9, and the hyphen. That works well for English, but the fact is that even though English is the language of international commerce, the native tongue of most of the world is not English. Even in many European languages, there are characters that aren’t used in English such as � � � � � � � � � � � � � �. Moving further afield, Russian and other East European languages use a Cyrillic alphabet. Then, of course, languages like Chinese and Japanese use characters with which we aren’t even familiar. And some languages – such as Arabic and Hebrew – are further complicated by the fact that people write them right to left.

To deal with all of these languages, a system has developed to translate foreign characters into standard ASCII characters via an algorithm known as Punycode. These characters are then preceded by the prefix “xn--“. This process can of course be reversed, and the name can be recoded.

The driving idea behind IDNs is that people want to use their own language on the internet, even if they know English. The basic investment concept behind IDNs is that as more and more people in non-English countries take to the internet, and as browsers support IDNs better, IDNs will be adopted more and more. It’s time to get in early before the widespread adoption of IDNs, while the prices are still cheap.

Here are some tips, tools and techniques so that you can get started investing in international domain names. I have also interviewed David Wrixon, one of the world’s most knowledgeable IDN experts, who has shared some of his wisdom.

Tips

1. IDNs are a conservative investment.

Unlike many types of domains that are claimed to have a lot of potential (*cough* dotmobi *cough*), an investment in IDNs is actually quite conservative. Even if you are a died in the wool dot-commer you can get into buying IDN dot coms. Instead of buying domains like cars.com or similar premium domains, you are buying domains like cars.com in Chinese, Japanese and Arabic. The only difference is that the IDN cars.com are a lot cheaper and have more appreciation potential as IDN use is still in its infancy.

2. Have It Your Way

Just like in the Burger King commercial, people want to have it their way. English is certainly the international language and to a large extent, the language of the internet. That being said, even people who can speak English fluently as a second language generally prefer to use their own language whenever possible. By using IDNs, companies are able to make their domains meaningful and memorable in their local languages.

3. English Speakers Can Get Involved

Don’t know any languages other than English? Although that certainly makes things more difficult, it is not an absolute barrier to getting started in IDNs. There are lots of free online dictionaries available for all languages. As well, many websites offer basic instruction as to how words are used in a particular language. Finally, many of the tools that you normally use in domaining can help you with IDNs. You can do things like check the Overture value of the word on the relevant country’s Overture tool, see how many results get returned in a Google search, use Google image search, see how many Google Adword results exists, and the like. As well, there are many native speakers around in forums who are more than willing to help.

4. Browser Support for IDNs

One thing that has held up the adoption of IDNs across the globe is the fact that in most countries virtually everyone uses Microsoft’s Internet Explorer. Up until the release of IE7, Internet Explorer did not have support for IDNs. Now that IE7 has been released, it is gradually being updated on computers across the globe, which is expected to spur an increased use of IDNs. IE7 resolves IDNs to punycode (an xn-- domain) by default unless you have added the language to your list of languages in language preferences, in which case the IDN will resolve to the native characters.

Firefox supports IDNs by default. Firefox displays IDNs in punycode unless the registry of the domain�s TLD has posted a policy on what characters it permits and how it handles homographs – similar looking characters from different character sets or scripts. You can see their policy and the whitelisted TLDs here. You will note that .com and .net are not on their whitelist. Not cool. Fortunately, outside English speaking countries, which is where IDN is primarily aimed at, Firefox does not have widespread adoption.

Opera resolves all IDNs to native character sets even when entered in punycode form. It’s a good browser, but not many people use it.

5. All I See Are Boxes

You should talk to your ophthalmologist about getting a stronger prescription for your glasses! Seriously, if you are looking at an IDN domain and all you see are boxes, you need to install international language support on IE7. To do this, go to start –> control panel –> regional and language options –> language tab –> click the boxes to install the character sets you want. After that, you will need to re-boot your computer.

Techniques

6. Most popular IDN Languages

If you are new to IDNs, it is best to try to specialize in one or two languages. If you already know the basics of a foreign language, that may be a good one to choose. Chinese and Russian are generally considered languages with a lot of IDN potential, because of their large populations and the so far comparatively low internet penetration in those countries. Japanese may also yield significant benefits given the country’s wealth and technology savvy.

I personally also like European language IDNs, such as French and Spanish. This is because the languages and cultures are easier to understand and the use of a few IDN characters is not really a big switch for people in these countries. I also like them because the words “.com” and “.net” make sense in those languages. As well, German IDNs already have a pretty strong record of good sales.

However, the general thought in the IDN community is that people in those countries really don’t need IDNs as much, and are quite used to seeing their words written without the appropriate accents on the letters. For instance, writing the letter “e” is fine, even though it should be “�”. Therefore, the adoption of IDNs in those languages is not as pressing as in languages that use a non-latin alphabet.

7. Monetizing Traffic

As for parking, the company that seems to offer the best support for IDNs is NameDrive. NameDrive returns ads in every language around the world, and you can input keywords in non-Latin characters. As well, related searches are logged in all character sets. Sedo also offers IDN parking.

For other monetization opportunities, check out IDN Affiliates, which provides a directory of foreign language affiliate programs.

8. TLD availablility

By now, most of the gTLDs offer IDNs. You can get IDNs in any language for .com and .net. .Org, .info and .biz support support a large variety of IDNs, but not all languages. That being said, I recommend sticking to .com and for very strong keywords, .net. Given the somewhat speculative nature of IDNs, there is no need to add a second speculative element – namely a weak TLD – to the mix.

IDNs are also available in most of the relevant ccTLDs – .cn, .jp, .de and so forth. Many countries have strong nationalistic tendencies for using their own ccTLDs, so some good opportunities exist here.

9. IDN.IDN

One of the largest wildcards on the horizon for IDN investors is the possible introduction of what is known as IDN.IDN. So far, we have been talking about the letters on the “left of the dot” being in a non-English language. But what about the letters on the “right of the dot”? Just as it’s awkward for a native Chinese speaker to type “cars” into their browser, it is also awkward to type “.com.” Right now, ICANN is testing the possibility of using IDN TLDs. What impact this will have on the IDN market is hard to predict. That being said, given the slow speed at which ICANN moves, even if ICANN approves the use of IDN.IDN, it could well be 2 or 3 years before this is introduced in practice. As well, the branding of .com is incredibly strong and likely would remain strong despite the availability of IDN.IDN.

10. Show Me The Money

Although most of the reason to invest in IDNs is future potential, there have already been a number of notable sales of IDNs, including the sale of st�dtereisen.de (city travel) for $104,325. To find a fairly comprehensive list of public IDN sales, you should check out the IDN Sales website.

Resource Websites

11. Forums

The IDN world is moving quickly. The best way to keep up to date is to join and participate in a forum dedicated to IDNs, as most of the traditional domainer forums tend to neglect this topic. Traditionally, the recommended forum is IDN Forums. However, the absence of the administrator in recent months has caused the forum to decline somewhat. There is still good archival material. A newer forum that is starting to take off is DN Local. Both forums are well worth joining. I’ve found the level of discussion there quite high and there tends to be a very collegial atmosphere.

12. Conversion Tools

One thing you will need when dealing with IDNs is that ability to translate words into the punycode equivalent and back again. Verisign has a good IDN conversion tool.

13. IDN News

You can keep up with the latest developments from ICANN concerning the implementation of IDN on their feed. This is particularly important for monitoring the development of IDN.IDN.

14. Registrars

The most popular registrar among IDNers is Dynadot, which offers an extensive range of IDNs. Moniker and Godaddy also offer IDNs in .com and .net.

Interview with David Wrixon

One of the best known experts in the IDN community is David Wrixon (known to many by his forum handle “Rubber Duck”, sometimes affectionately shortened to “RD”). David took time out of his busy schedule to speak with me about IDNs. Here is what he had to say:

1. Please provide a brief biography so that my readers know who you are.

I am/was an impoverished Civil Structural Engineer from the UK. As we are now reaching a stage in IDN development when our need to sell domains from stock to function is effectively coming to an end, I therefore have no intention of trying to create a personality cult. Indeed, I may yet disappear into complete seclusion. You may simply call me Rubber Duck or RD as I am known to most IDNers.

2. How did you get into domaining? How did you get into investing in IDNs?

I was trying to set up a website for my structural engineering business. The name I really wanted was stolen away from me by Buydomains, even though I had the Snapnames option. That led me to want to find out more. I never did get the name, and the business is now being run down. The site was a success in its own terms, but it takes a bit more than Google SERP to make it in that kind of business. But having got good traffic from a dot biz generic, I was convinced about the value of Generic Keywords.

I tried to make it in the ASCII World but believed I got in too late. However, it would appear that I could been another FS, if I had known what I was doing. I failed to appreciate the importance of the dot com extension, and settled for dot net. That was a major strategic error. That in part was the attraction of IDN. A vast untapped pool of dot coms, although we did pick up some dot net along the way.

I saw a punycode domain sell on Sedo. I need somebody to explain what they were, which my friend Domainguru duly did. I realised I could get free online translation for Chinese, and the rest is as they say “History”.

3. What do you believe are the advantages of investing in IDNs?

Three things really. ROI, ROI and ROI.

4. What are the risks of investing in IDNs?

As with ASCII one major risk is buying rubbish, although this can be avoided. Evaluate the name before you buy. We did this largely buy searching the terms on Google, although many of the languages we bought didn’t even get indexed until after we had invested. Google images can be very telling and Google Trends is also very useful. Also look for Adsense. Commercial terms have adsense in most languages.

The biggest risk in domaining is coming second. That applies to IDN just as it always did to ASCII.

5. How well do you think investors in IDNs will do compared to investors following more traditional domain investment strategies (say, for instance, those followed by Frank Schilling or Sahar Sarid)? Why?

There are IDN investors out there that will make Frank Schilling look like an amateur. I suspect, however, I am not one of them. Sahar seems like a nice guy, but he will never be Andrew or Laura Snow.

6. How does someone who only speaks English get started in investing in IDNs?

Same way as I did I guess. I am not a linguist.

7. What impact do you think the introduction of IDN.IDN domains will have on current IDN investments? Do you think it makes sense for domainers to wait until IDN.IDN is finalized before investing in IDN domains? Why / why not?

IDN.IDN is essential for Right to Left scripts. Their introduction will bring publicity and clarity and will start to spur the market. They will bring new opportunities in some ccTLDs. They will not, however, fundamentally change the market. The real opportunities now lie mainly in the secondary market. There is growing appreciation of this even amongst established ASCII players. 2008 will develop into a bun fight, but I will for the most part be sitting on the sidelines.

8. What kind of traffic do IDN domains receive? What kind of income? Are there any trends? Are there any parking programs specifically aimed at IDN domains?

Trend is very steeply up. It is a bit like asking an astronaut for his altitude just as he clears the tower. At least wait until the bloody booster rockets fire!

9. In which languages would you recommend investing in IDNs? Why?

It is really all down to market potential. Demographic and economics will dictate a lot of this. Some markets are more developed than others. Japanese may be one of the front runners, but it will not compete longer-term with Chinese, Arabic, Russian or Hindi. I have been successful by investing where belief had yet to materialise. Look for potential rather proven traffic.

10. Are there particular segments of the IDN market that you expect to perform better than other (e.g. geo domains, etc)? Why?

I expect brandables to under perform. We may sell those of in about 5 years time. Mind you we will be looking for a million bucks per name and even a lot more, in some cases. That is if domains are still priced in dollars.

11. Is it still possible to hand register IDN domains profitably?

It is getting tough. Yes, you can. It depends on your benchmark for success. FS never really made it big doing a lot of hand regging. If you are a late comer this is going to prove a fairly lame strategy on the whole.

12. IDNs are often said to be a “long term investment.” Would it make sense to wait a few years to invest in IDNs until it looks like they are about to take off?

A long-term investment is simply a short-term investment that turns sour. This really should not have taken this long. Its delay has largely been down to the ineptitude of ICANN and Microsoft. The last couple of years have been tough, but the worst is over now. The initial land grabs occurred 7 years ago. If this doesn’t fly this time, then it is never going to. It is simply an idea, whose time has come. Those that are waiting have the wrong end of the telescope against the eye.

13. Do IDNs in non-dot com gTLDs have much value?

Good dot Net, yes. Other than that probably not.

14. What do you think of ICANN’s performance in advancing IDNs?

Poor, but then what did you expect?

15. What sort of end user adoption of IDN domains have you seen?

There are registrations and developed sites waiting in the wings and even big US Corporations are getting in on the act. They have largely gone for dot coms or ccTLDs. The critical factor will be the in the face marketing that is needed to raise public awareness. That is coming but you cannot expect much until you have widespread browser support. That is arriving in Russia, and will soon be rolled out in the Far East. The next two months will see a sea-change.

16. What do you think needs to happen for IDNs to really take off?

It probably just needs me to go on holiday for a few weeks!

Thanks David for your insights!

As the domaining industry matures, it is becoming harder and harder for people new to the field who do not have large budgets to earn the staggering kinds of returns that people like Frank Schilling have. But for the person willing to do the necessary research, planning and investing, IDNs may prove to be very lucrative. Best of luck in your IDN investments!

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