Internet and e-commerce industry in the Isle of Man

This wonderful and unique ancient island has been inhabited since before 6500 BC. The Isle of Man, known simply as Mann, represents a self-governing British Crown Dependency, located in the Irish Sea between the islands of Great Britain and Ireland, with Queen Elizabeth II, holding the title of Lord of Mann, as the head of state is. The Island of Man is not a part of the European Union, but has a limited relationship concerning the free movement of goods.

The key sectors of the economy of the island, populated slightly over 80,000, are offshore banking, manufacturing, and tourism. It’s important to note, the Island of Man has managed to become one of the leading offshore jurisdictions. Moreover, the government offers incentives to high-technology companies and financial institutions to locate on the island.

Currently, the Isle of Man has close to 100% broadband coverage after the leading operator, Manx telecom, upgraded six remaining telephone exchanges with ADSL-enabling equipment. Such a capacity let the island to potentially become one of the most attractive high speed internet locations in Europe.

Broadband internet services in Mann are available through five local operators:

• Manx Telecom- the primary telecommunications provider on the Isle of Man. The ISP represents a wholly owned subsidiary of Telefónica Europe.
• Wi-Manx - is a current market leader based on the Isle of Man, specialising on Home Broadband, Business Internet connectivity, VoIP, Internet Telephony and network solutions. It’s the only ISP on the Island to utilize WiMAX wireless technology and manage its own SIP termination service for VoIP
• Domicilium
• Manx Computer Bureau - offers a full range of services, all supported by company’s helpful and knowledgeable support team. Being a small ISP the company offers a personal service to its clients, tailored to their needs, using some of the most up-to-date hardware and software available.
• BlueWave Communications

Two other main competitors attempted entering the Mann’s ISP market, Cloud9 and Sure. However, Cloud 9 failed.

Cloud9 had planned to introduce a new mobile service with local Internet Service Providers. Mobile telephones was supposed to transfer to VoIP when near Wi-Fi Hotspots. The first stage of Cloud9's Isle of Man mobile network launch was limited to consumers who had registered on the Cloud9 website. The service collapsed within 48 hours of launch.

Sure represents the trading brand for Cable & Wireless in the Channel Islands and Isle of Man. The operator entered the Isle of Man market in 2007. Sure has got permission to offer fixed-line telephone services across Manx Telecom lines.

.im has been the National Top Level Domain (ccTLD) for Mann since 1996, when the Isle of Man Government obtained permission to use own national domain. It is administered by the Government of the Isle of Man and managed on a day to day basis by Domicilium, an offshore Internet Service Provider based on the Isle of Man.

At present, domain registrations is £40.00 per year for domains of three letters or more, although they can be purchased much more cheaply through resellers. Premium domains with two character names can be purchased for £495.00, and premium domains with one character names are available for £995.00.

Since 2006, .im registration has been made available to anyone in the world, including one, two, and three letter domains directly under .im, which opens up the possibility of .im domain hacks.

The domain is getting popularity with instant messaging software companies, like Adium, ejabberd, Coccinella, IMO, Meebo, Pandion, Pidgin, Prosody, Trillian, and Yahoo! .im ccTLD is also used in some German, French and Italian speaking countries for Real Estate purposes (Immobilien in German, Immobilier in French, Immobiliare in Italian).

Mann is currently represents one of the leading offshore jurisdictions, being one of the few which have enacted e-commerce legislation and which is already host to an active e-commerce community of providers and users.

Having websites located in the Isle of Man to carry out functions previously based in high-tax jurisdictions, sales and marketing, treasury management, supply of financial services, and most of all, the supply of digital goods such as music, video, training, software businesses enjoy benefits of low rates of taxation for substantial parts of their operation.

Like other offshore jurisdictions, the Isle of Man can take benefits from of the natural link between the Internet and Offshore stemming from the fact that both, of their nature, manage to avoid tax and the regulatory blanket that tends to smother larger countries.

0% corporate tax regime existing in Island of Man, couples with extremely high personal income tax at a maximum level of £100,000 per annum. That became one of the key factors in transforming Mann into a leader of e-commerce and offshore business.

The other decisive factors stipulating the growth of e-commerce in the jurisdiction include increased off-Island competition as a result of the licensing of Cable & Wireless, which has led to lower bandwidth costs. Besides, provision of new world-class hosting facilities in the form of Manx Telecom’s new Douglas North facility; evidence of clustering in the online gambling sector and the beginnings of “stickiness” of operators in the sector; a number of “excellent sales wins”, including Microgaming, Poker Stars and Inca Gold; along with clear signs of significant improvement in collaboration between business and government on e-business and economic development issues all these also determined the success of e-commerce deployment in the island.

Businesses which can operate on the Internet without touching ground in a high-tax jurisdiction will naturally migrate to offshore jurisdiction of the Island of Man. Moreover, companies that already have offshore presence will definitely find it highly convenient to be able to use the Internet to trade with their high-tax customers without the necessity to make a landing in their countries.

High level of ICT infrastructure development, strong government support, attractive tax legislation let the Island of Man reach leadership amid the offshore jurisdictions. Currently Mann allures the variety of business from different countries mainly because of its 0% tax regime and rapid deployment of Internet and e-commerce related services.