Geopolitics and the Future of Domains

With a Capital One Saver card, you'll earn unlimited three percent cashback on dining, entertainment, and at grocery stores. And for a limited time, new card members can earn a two hundred fifty dollars cash bonus after spending five hundred dollars hundred on purchases within the first three months. So grab a bite, grab a seat, and earn unlimited three percent cashback with the Saver card Capital One. What's in your wallet? Terms apply. See capital onene dot com slash saver for details never bet against American grit O American energy Through innovation, Venture Global is not only building some of the largest energy facilities in the world, right here in the United States but delivering American energy at a fraction of the cost and a fraction of the time. So while others are busy talking We're busy building. That's Venture Global That's unstoppable energy The island of Anguilla is rich with natural beauty. If you venture to this tiny oasis in the easastern Caribbean You'll find turquoise waters, palm trees, coral reefs and some of the most picturesque white sand beaches in the world It's the kind of place you go to when you want to escape modernity and bathe in the wonders of the physical world For many years, An Gorilla's economy rested on that beauty. The island made its money from tourism and lobster fishing In more recent times, Anguilla has struck gold with a digital asset To little letters at the end of website addresses. When we first started, it was around four or five thousand dollars a month And now this month will be around four million that were seen from. AI. will be over half the government budget within a year E Economics Radioetork. This is the economics of everyday Things. I'm Zachary Kraacket. Today, top level domains On the internet, websites are identified by an address known as a uniform resesource locator, or URL When we talk about websites, we usually refer to URLs by two parts There's the second level domain, which identifies the particular websites, say Google And then there's the top level domain, which might be commalM Parts of a URL are separated by dots So we usually call the top level domain d. com A topop level domain is a way of sort of categorizing a domain name into a certain subject area, if you will Kim Davies is the head of the Internet Assigned Numbers Authority, or Iana for short It's the organization responsible for keeping a record of all the domain name identifiers on the internet. All in all, there are nearly fifteen hundred of them And each one serves its own purpose. . Eu is for educational institutions,. mIL is for the military . Gov is for government Some are serious Others can get a little sillier In fire . museum. ninja That team does is maintain the official records of which identifiers have been assigned and make sure that they're used in a standard way on the internet When the system for organizing domains was being developed in the early nineteen eighties, the newborn internet was dominated by researchers in the United States As the rest of the world began to connect to the network There is a recognition that each country should have its own domain too those different research networks popping up in different countries And they were contacting the researchers in the US to work out how to connect to this growing network. There needed to be a sense of agency for each country to sort of own and control their part of the network. The result was something called country code top level domains, or CCTLDs Each country got its own two letter top level domain . us. ca. UK FR But the idea was that these domains would be reserved for businesses and institutions in the associated country If you were a construction firm in Colombia, your domain name would end in.co And if you were a bike shop in Italy, your website would end in. it The task of assigning all these domains to countries was overseen by a man named John Pastel John Postell was one of the original researchers on the team that invented what we know of today as the internet Costel had a neck for being A record keeper for all sorts of things Technical people and not particularly well versed in Matters of international diplomacy And therefore he made a rule that Iyanna shouldn't be in the business of deciding what is or is not a country To avoid international disputes, Pastel used a list of country codes published by the International Organization for Standardization But he also had to find someone in each country to manage the domain process was a little less rigorous. By most accounts, the power to manage domains was delegated to the first person in any given country that requested it In some cases, that was a government body, a research institution or a nonprofit But in others, it was just a random guy who asked for it before anyone else I'm the technical contact for the. A domain in Anguilla. Vince Kate moved to Anguila in nineteen ninety four after getting an advanced degree in computer science from Carnegie Mellon University I wanted some country that didn't have income taxes And so I read some books about tax havens and then I went down and checked out a few islands. and decided that I could live in the Caribbean At the time, Anguilla didn't have internet or email Kate would connect to a computer in the US using a telephone modem He was interested in registering a website for a company he was starting. He contacted John Pastel. To a surprise? Pastel said that he needed someone to oversee the. AI domain that had been assigned to Anguila And he said, Nbody's managing that yet. Did I want to manage it? I'm like, okay As the domain administrator for Franguilla Kate had the power to decide which websites got to use. Ai At first, there wasn't much interest on the island. The first few years I was letting anybody in Anguilla wanted to register a name for free But I wasn't letting anybody outside of Anguila By the late nineteen nineties, millions of ordinary people were using the internet Websites were displaying ads and offering things for sale which meant that a catchy domain name was like an attractive storefront And as new technologies emerged, Certain top level domains like. AI took on a new meaning. Kate realized that companies all over the world wanted to be associated with artificial intelligence. And they were willing to pay money to register a website ending in. Ai They started to trickle in around twenty fifteen An AI cloud platform registered h twoO. Ai and an AI tool for developers registered API. Ai Kate could feel that a wave was coming And he wanted to make sure Anguilla would benefit from it Somewhere along the line, a few years in, I decided it really shouldn't be in my name. Like the whole thing was in my name, right? I was the admin contact and the technical contact And so I changed the admin contact to the goovernment of Anguila. Anquuila opened up the. AI domain to entities outside of the island and began charging a registration fee for its use Throughout most of the two thousands, those registration fees brought in a small but steady trickle of business And then Artificial intelligence became hot And in november twenty twenty two, chat GPT came out. And it just took off I was printing off a page of domains and, you know, Bring it to the government every month. These are the domains that we sold this month, right And then after Chat GPT, we you know stopped printing them out. we just gave them a spreadsheet, you know, and a PDF file And then it got so big we couldn't even generate the PDF file anymore Revenue for. AI domains grew from seven point four million in twenty twenty one to around thirty millionars in twenty twenty three This year, Kate says that figure could be north of fifty million dollars More than forty percent of the country's annual revenue Most of that is from registration fees, which now cost one hundred and forty dollars for a two year contract But some of it comes from auctions. If somebody stops paying for a domain name. And then what we do is we auction it off And some of the ones that we auction off might sell for thirty thousand dollars or twenty thousand dollars or something. And so we've made around a quarter million dollars a month for the last couple of months, just selling domains that people stopped paying for Recently, the address vision. Ai sold for one hundred thousand dollars Task. AI commanded seventy nine thousand dollars And dog. Ai forty seven thousand dollars. That's serious cash for an island that only has sixteen thousand inhabitants and thirty five square miles of land notot every country with a desirable domain has had a success story like Anguila Some CCTLDs have become geopolitical and commercial battlegrounds That's coming up. With the Capital One Saver card, you'll earn unlimited three percent cashback on dining, entertainment, and at grocery stores. And for a limited time, new card members can earn a two hundred fifty dollars cash bonus after spending five hundred dollars on purchases within the first three months. So grab a bite, grab a seat, and earn unlimited three percent cashback with the Savver card Capital One. 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There's no catch. forty five dollars upfront payment required, equivalent toteen dollars a month New customers on first three month plan only speeds slower above forty gigabytes on Unlimited plan. Additional taxes fees and restrictions apply, see MintMobile for details never bet against American grit Or American energy Through innovation, Venture Global is not only building some of the largest energy facilities in the world right here in the United States But delivering American energy at a fraction of the cost in a fraction of the time. So while others are busy talking We're busy building That's Venture Global That's unstoppable energy Today, nearly two hundred and fifty countries, sovereign states and dependent territories have been assigned a top level domain Kim Davies, a Viana says that in many cases, a country's designated domain has become a hot commodity Each country has been sort of gifted Two letters and The two letters you know nominally relate to the name of their country. Sometimes there is some kind of alternate value in what those two letters stand for Saint Vincent and the Grenadines, for instance, has. VC which has become a desirable domain for venture capital firms Menistan has the lawyer friendly. TM Djiboutis. DJ is popular with musicians And Colombia has. coO Many companies around the world now use as an alternative when the d. com version of the name they want is taken Many smaller nations who have a potentially lucrative domain name the digital infrastructure to take advantage of it They have to seek out a marketing partner in a more developed country Vince Kates says these arrangements are often a raw deal Some of the other countries that didn't know how to run their own domain some company would come in and say, oh, we'll give you a million dollars a year the next fifty years and then they're stuck with that And some of them spent years and years and years trying to break those contracts because the company's making all the money This is what played out in Tuvalu An island in the South Pacific The nation was assigned the.tv domain. which became lucrative with the rise of online media It decided to outsource the management of its domain to private companies And eventually, it inked a deal with the American tech firm Verasign. Verisign paid Tuvalu a flat sum of around five million dollars a year from the revenue it made In twenty twenty one, Tubvelve signed a new deal with the domain registry G Daddy, also based in the US The island now receives ten million dollars a year which accounts for nearly twenty percent of its GDP The money from these deals has been a windfall for Tuvalu, which has used it to build roads and expand access to electricity It's only a fraction of what they'd earn if they set up their own technical infrastructure like Anguilla That's going to look stupid again in another ten years, right If the money iss becing worth less and less all the time and any fixed amount after a while, it's going to look ridiculous So I don't think they really learned their lesson This imbalance is a common story in the world of CCTLDs These profits are not going to the people who live in places underrepresented on the international stage they're going to sort of the pockets of corporations in the United States and New Europe Tian Yu Fang is a contributing editor at the teech publication reboot, where he's written about the politics of top level domains He says that other places have fared far worse than Tuvalu Like Nuay, a small island nation in the South Pacific Ocean In the early years of delegation It was assigned. Nu An American businessman convinced UA officials to let him control the domain in exchange for connecting the island to the internet businessman later transferred the ownership of. Nu to a nonprofit in Sweden In the past two decades, that company has made millions of dollars selling domains ending in. Nu which means now in Swedish The NewA government was never able to claim it back to get it redelegated with the IA andA NA has been trying to get. N U back for several decades The nation has an ongoing case in the Swedish Supreme Court and is seeking around thirty million dollars in damages Being a country in the Southern Pacific, you probably don't have a lot of access to legal resources in Sweden So in many ways, it's a rig game, right? You don't have the level playing field with a jurisdiction that basically sets laws A similar story played out on the Pacific Island of Tokalao It delegated the management of its. tK domain to a New Zealand entrepreneur who ended up giving out registrations for free TK became the top level domain of choice for spammers and cyber criminals who wanted to create burner websites. Other top level domains like. o are embroiled in the politics of colonialism The IO domain is extremely popular with tech companies in the Silicon Valley, mostly because IO stands for input output So you see a lot of programmers and startups using it as their domain name . Io was assigned to the British Indian Ocean Territory It fell into the hands of a British entrepreneur who profited from it for twenty years He then sold his domain management firm for seventy million dollars to an American domain registry company Today. It's under the ownership of a private equity firm. The native Chigosian people who were forcibly removed from the territory in the nineteen seventies believe that they are the rightful beneficiaries of. IO Kimin Davies says that Ayana generally stays out of such affairs The basic principle is disputes over how a top level domain operates in a country should be resolved in the country This has led to some tricky situations In Afghanistan, for instance, the.AF domain is now under the control of the Taliban And repeated calls for a re delegation of the domain have gone unanswered But some situations do require intervention In the event that a country disappears Iianna's policy is that the domain will go down with the ship