A domain name is the unique name of a computer on the Internet that distinguishes it from the other systems on the network.
Every website, email account, etc, on the Internet is hosted on at least one computer (server). Each server has a unique IP address which is nothing but a set of numbers, such as "22.214.171.124". To access a particular internet service, one can specify its IP address in an appropriate application, such as an FTP client; however because it is difficult to remember numbers, an IP address can be associated with a fully qualified host name (a domain name), such as "www.wikipedia.org". Domain names also provide a persistent address for some service when it is necessary to move to a different server, which would have a different IP address.
Each set of letters and numbers between the dots is called a label in parlance of the domain name service (DNS). There are some rules about the size and make up of labels. Each must start with a letter or number, and then may be made up of letters, numbers, and hyphens, to a maximum of 63 characters. These are the rules imposed by the way names are looked up ("resolved") by DNS. Some top level domains (see below) impose more rules, like a minimum length, on some labels. Fully qualified names are sometimes written with a final dot.
Translating numeric addresses to alphabetical ones, domain names allow Internet users to localize and visit websites. Additionally since more than one IP address can be assigned to a domain name, and more than one domain name assigned to an IP address, one server can have multiple roles, and one role can be spread among multiple servers.
The following examples illustrates the difference between a URL and a Domain name:
Server name: www.example.com
Domain name: example.com
Second level domain: example
Top level domain: com
As a general rule, the IP address and the server name are interchangeable. For most internet services, the server will not have any way to know which was used. The big exception to this is for web addresses. The explosion of interest in the web means that there are far more websites than servers. To accommodate this the hypertext transfer protocol (HTTP) specifies that the client tells the server which name is being used. This way one server, with one IP address, can provide different sites for different domain names.
For example, the server at 126.96.36.199 handles all of the following sites:
Every domain name ends in a top-level domain (TLD) name, which is always either one of a small list of general names, or a ISO-3166 two character country code.
Examples of (gTLD) extensions are:
Examples of country code top-level domain (ccTLD) extensions are:
- .uk (not an ISO-3166 code, but used anyway)
ICANN (Internet Corporation for Assigned Names and Numbers) controls the domain name root to regulate the Internet (accrediting domain names registries) and manage the Domain Name System (DNS). For ccTLDs, each country has its own domain registries. ICANN has only a consultation role in these domain registries but is in no position to regulate the terms and conditions and the operations of how a domain name is allocated or who allocates it in each of these country level domain registries. Since gTLDs is governed directly under ICANN, all terms and conditions are defined by ICANN with the cooperation of the generic top-level domains (gTLD) registries.
Domain names which are theoretically leased can be considered in the same way as real estate, due to a significant impact on online brand building, advertising, search engine optimization, etc.
Generic domain names — problems arising out of unregulated name selection
Within a particular top-level domain, parties are generally free to select an unallocated domain name as their own. For generic or commonly used names, this may sometimes lead to the use of a domain name which is inaccurate or misleading. This problem can be seen with regard to the ownership or control of domain names for a generic product or service. Should the first party to be allocated or who has otherwise registered the domain name control the domain name, or should the domain name instead be reserved for use as a web portal?
By way of illustration, there has been tremendous growth in the number and size of literary festivals around the world in recent years. In this context, should a generic domain name such as literary.org be available to the first literary festival organisation which is able to obtain registration, even if the festival in question is very young and therefore obscure? Or would there be much greater amenity in reserving such domain names for the use of, for example, a regional or umbrella grouping of festivals? Related issues may also arise in relation to non-commercial domain names.
Commercial Resale of Domain Names
An economic effect of the widespread usage of domain names has been the resale market of generic domain names that has sprung up in the last decade. Certain domains, especially those related to business, gambling, pornography, and other commercially lucrative fields have become very much in demand to corporations and entrepreneurs due to their intrinsic value in attracting clients. For example, the domain name Sex.com was the subject of a long-standing law suit in the United States after it was stolen from its rightful owner by a thief who has since fled to Mexico. During the height of the dot-com era, Sex.com was earning millions of dollars per month due to the large influx of visitors that arrived daily.
One of the reasons for the value of domain names is that even without advertising or marketing, they attract clients seeking services and products. Furthermore, generic domain names such as Rent.com or Books.com are extremely easy for potential customers to remember, increasing the probability that they become repeat customers or regular clients.
Although the current domain market is nowhere as strong as it was during the dot-com heyday, it remains quite strong. Annually tens of millions of dollars change hands due to the resale of domains.