Growth in demand for domain names has been hit by the recession, research by internet infrastructure provider VeriSign has revealed.
The number of domain names registered per quarter in 2008 slowed to 11.9 million, compared with 12.2 million in 2007.
But the internet is still growing rapidly, said Tobias Wann, director of VeriSign's domain names services
The internet added 24 million new domain names in 2008, according to the fourth quarter 2008 Domain Name Industry Brief published by VeriSign.
In the last quarter of 2008, VeriSign processed a peak of nearly 50 billion domain name system (DNS) queries per day, each representing an internet user accessing a website or sending e-mail.
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The top five TLDs remained the same for 2008 with .com having the largest number, but the .cn country code TLD for China pushed Germany's .de into third place, followed by .net and .org TLDs.
The .cn country codegrew 51% to oust .de from the top spot with only 7% growth, but the UK remained in third place with 13% growth in 2008.
This indicates the internet is very healthy in the UK, with high levels of penetration and a good infrastructure making the .uk country code attractive to local and foreign companies, said Wann.
The .ru country code TLD for the Russian Federation grew the fastest, with 11% growth quarter on quarter, compared with the .cn TLD's growth of 8%.
The number of country code TLDs grew 22% to bring the total to 71.1 million, showing internet usage is growing fastest in non-English or other Latin-based language countries.
This highlights the importance of improving the user experience for people in those countries by implementing domain names in local languages and characters, said Wann.
Known as internationalised domain names (IDNs), these TLDs use local language characters to represent the domain name, followed by a common TLD such as .com or .net.
This year, the international domain name authority ICANN plans to begin extending this to entire TLDs and will fast-track the process for country code TLDs such as Russia's.
VeriSign has joined ICANN and other organisations that are working towards the development of fully internationalised TLDs.
A collaborative approach is vital to ensure interoperability and interconnectivity from a technical point of view, said Wann.
"We need a global approach to ensure full access to internationalised TLDs by all infrastructure operators and users," he said.