Caribbean island finds 'totally incidental' way to cash in on AI boom
A small Caribbean nation is capitalizing on the artificial intelligence (AI) boom thanks in part to a coincidence that came about when internet domain codes for countries were awarded decades ago.
The island of Anguilla, a British Overseas Territory located east of Puerto Rico in the Caribbean, received the .ai country code for internet domains in 1995 from the International Telecommunication Union. Anguilla's government allows buyers to purchase the .ai registration for their website for terms of up to two years, with follow-on renewals possible.
The number of .ai registered domains surged from about 100,000 in 2021 after the launch of OpenAI's ChatGPT in November 2022, which kicked off the AI boom. Last year, the number of .ai domain registrations more than doubled from 144,000 in 2022 to 354,000 in 2023.
"With the advent of artificial intelligence as it is, it has made .ai very attractive, and so we have been growing in terms of our revenue generation from .ai by leaps and bounds," Haydn Hughes, Anguilla's minister of tourism and infrastructure, told FOX Business in an interview.
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Hughes said it was "totally incidental" that Anguilla was granted the .ai domain code in 1995 and added, "At that time, we didn't have computers in Anguilla, we didn't have any modern technology in Anguilla in 1995, and so we didn't have email addresses, we didn't have internet. So, artificial intelligence was something that was far removed from our cerebral cortex."
"As time progressed, we saw the potential with this administration that I'm a part of. It's a very young administration," Hughes said. "We have ministers who are really tech-savvy, and so we've been able to monetize this, and it's great for the island, and we've been able to invest in a significant amount of physical and social infrastructure."
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The surge in .ai domain registrations has increased the share of the government's revenue from the registrations from over 4% of revenue in 2019 to more than 20% in 2023, when they generated about $32 million in revenue.
The government expects that will stabilize at about 15% of revenue when the rush of registrations eventually eases, according to the IMF report, which also noted that a similar domain name dynamic played out with the South Pacific nation of Tuvalu, which was granted the .tv domain code.
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Hughes said the attention that the .ai domain has brought to Anguilla has helped the island raise its profile in the tourism industry, which accounts for about 37% of its gross domestic product.
"One of the things that is really great about it is that those persons who have never heard of Anguilla now know of Anguilla. And especially when persons come to Anguilla to see what this .ai rave is about, they are quite amazed to see all of the offerings that we have in terms of our hospitality, in terms of our restaurants, our hotels, our villas," Hughes added.
He also noted that the influx of revenue helps Anguilla maintain its low tax regime, which features no taxes on personal income, capital gains as well as no corporate tax.
Hughes said that among the investments Anguilla has used the .ai revenue to finance include a program called Senior Shield, which provides comprehensive health care to residents over age 70.
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The government is also digitizing the public school system to ensure students have laptops and providing digital scholarships, and it is building a new terminal at the airport as part of an expansion, he added.
"It's an island of 15,000 people, so you know this goes a very long way," Hughes said.