Dubai: Domain name

The California-based Internet Corporation for Assigned Names and Numbers (ICANN) has published the long-awaited list of organisations seeking to obtain new generic top-level domains (gTLDs), commonly recognised as internet address endings or suffixes. Dubai eGovernment (DeG) is one of the more than 1900 applicants for gTLDs and is hoping to secure the recently dubbed dotDubai suffix.

This is an important step as the likes of the familiar .com, .net and .org suffixes will be joined by a plethora of new address endings. Some particularly attractive gTLDs such as .app, .home and .inc have seen multiple applications, and ICANN will have to decide which of the applicants should rightfully take ownership. Unsurprisingly, internet giants such as Amazon and Google have been at the forefront of the bidding.

For Dubai, the $185,000 application fee and possible $25,000 annual renewal cost is nominal, and the longer-term benefits of securing the gTLD could prove many and varied. The emirate’s online branding would be greatly enhanced if the city obtains the gTLD, and DeG has plans to roll out the new suffix across myriad government entities and Dubai-registered organisations. DeG believes the domain would help promote Dubai internationally across multiple sectors, including tourism and culture, in addition to business. DeG is seeking partnerships with local and international experts to establish best practices so that the future allocation of the dotDubai suffix is fair and transparent.

Importantly, the new domain will also create a clear and direct route for e-commerce, and this is a strong area of growth throughout the UAE and the wider region. A report commissioned by Visa Middle East and undertaken by Interactive Media in Retail Group International last November estimated that the GCC region’s business-to-consumer e-commerce sales would reach $5bn by the end of 2011 and highlighted that Dubai, and the UAE as a whole, had made big progress in encouraging the online retail sector, particularly by deploying e-government portals.

DeG has been in the vanguard of pushing the use of online transactions and services in Dubai. In January DeG reported that its ePay payment portal had seen a 49% increase in collections in 2011. The government accrued more than $1bn via online payments last year, with Dubai Customs, the Roads and Transport Authority, the city’s government-owned utility provider and the health authority all enjoying regular traffic on their e-payment sites.

“The UAE government is leading the way for e-commerce in the country with the Telecommunications Authority designated to create an effective e-commerce environment. Meanwhile, in Dubai specifically, the ePay gateway has had a huge impact, enabling customers to settle fees of e-government services online on a 24/7 basis in a secure environment. This endorsement is significant in that it encourages further internet usage and consequently online shopping.”

A recent study by consultancy firm AT Kearney, focusing on the expansion in the online retail business, placed the UAE sixth in a list of countries, topped by China, that have the most e-commerce growth potential. The country’s technological development and its 78% internet penetration rate were seen as key factors.

Omar Kassim, the founder of JadoPado, a UAE-based online retail store selling a range of products including electronics, has seen his firm enjoy a 40% spike in sales so far in 2012, as more and more consumers turn to online services. He told OBG the e-commerce sector is growing quickly: “Consumers are clearly flocking to the web to purchase both goods and services. Locally, the coupon and discount sites have driven a lot of traffic, and this has had a knock-on effect for full-priced retailers such as ourselves. Consumers are willing to try out new service providers and are definitely up for trying new experiences. It remains a nascent market but one that is catching up quickly.”

The increasing need for governments and enterprises to have an effective and visible online presence has prompted other Gulf-based organisations to make applications to ICANN. Radix, a subsidiary of the Dubai-based Directi Group, has invested $30m and applied for 31 gTLDs, while the likes of Abu Dhabi’s Etisalat, Abu Dhabi Systems and Information Centre, Qatar Telecom and Kuwait Finance House have also submitted bids, with some for suffixes in Arabic script. The “Middle East Internet & B2C E-Commerce Report 2012” by research firm yStats.com found that online shopping in the region has surged due to the increasing popularity of group buying websites, which offer heavily discounted prices. The most sought-after products have been airline tickets, consumer electronics and household appliances.

But online shopping is still a relatively new concept and the yStats.com paper also revealed that nearly 50% of web users did not make online transactions in 2011 due to a lack of confidence in available payment methods. A recent survey carried out in the US, Russia and parts of Europe by Harris Interactive, in association with IT security firm Kaspersky Lab, found that 60% of users said the exploitation of their personal financial data by cybercriminals was their biggest fear when going online.

Omar Kassim told OBG the availability of the dotDubai gTLD would not only provide a solid foundation for local entities as they develop their online presence but it would also help to assuage any lingering doubts some consumers still have about making online payments and orders: “When applied to e-commerce businesses, it will help provide a sense of authenticity to locally based brands. One of the most common hurdles e-commerce businesses face is a lack of trust in consumers, and a dotDubai domain will give online retailers an opportunity to build this trust.”