The two-decade battle for two letters on the Internet

The island of Niue in the South Pacific is one of the most remote places in the world. The nearest neighbors, Tonga and American Samoa, are hundreds of kilometers away. The advent of the Internet promised, on a small scale, to make Niue and its roughly 2,000 residents more connected to the rest of the world.

In the late 1990s, an American businessman offered to connect the island to the Internet. All he wanted in return was the right to control the .nu suffix assigned to Niue for his web addresses. The domain did not appear just as lucrative as .tv – which would go to Tuvalu, another South Pacific country – and the leaders of Niue (pronounced New-ay) signed the deal. But the two sides soon became at odds.

Now, after more than two decades of back and forth, the disagreement is finally nearing a resolution in court. Disputes over domain names were not uncommon during the Internet's infancy, but experts struggle to recall a dispute that lasted so long.

It turned out that .now was actually very valuable. 'Nu' means now in Swedish, Danish and Dutch, and thousands of Scandinavians registered websites with that suffix, creating a stable business for Niue's business partner Bill Semich.

Niue, an oval-shaped coral island with an area of ​​about 100 square miles, about the size of Lincoln, Neb., felt like it had been deprived of a reliable flow of money that would have helped it reduce its dependence on tourism and foreign aid. It had previously turned to unorthodox sources of income by selling stamps and coins to collectors. It had also rented out its international area code, until Niue's deeply Christian residents were woken up at midnight by wayward sex calls from Japan.

Niue canceled the deal with Mr Semich in 2000 and is trying to reclaim .nu – which is now controlled by the Swedish Internet Foundation, a non-profit organization – ever since. She is seeking about $30 million in damages from the foundation, an amount that could be transformative for a small island that was only recognized as a sovereign state by the United States in 2022. The dispute has ended up in the Swedish courts, and a judge in Stockholm began hearing Niue's arguments last week. A ruling is expected in the coming days.

“This is a unique, complex and somewhat strange case,” said David Taylor, an intellectual property and domain names expert at law firm Hogan Lovells, adding that this made it extremely difficult to predict the outcome of the case.

For Niue's leader, it is a fight for self-determination. Niue is self-governing but heavily dependent on New Zealand, and the two have a political relationship known as free association.

“We are victims of digital colonialism,” Niue Prime Minister Dalton Tagelagi said via crackling video link from his office in the capital Alofi. “This domain, the .nu, recognizes Niue as a sovereign country. It is that important to our identity.”

Critics question this assessment, as there is formally no such thing as sovereignty in cyberspace, but only administrative zones that divide the Web into domains such as .nu and, for example, .nz. suffix assigned to New Zealand.

Winning the case could help ensure Niue's long-term survival, Mr Tagelagi said. The island's population is now about a third of what it was in the 1960s, and the vacant houses scattered across the island are a reminder of the people who left for better economic opportunities. A win could help fund its bid to join the United Nations, similar to how Tuvalu gained UN membership after monetizing .tv.

If Niue manages to get .nu back, it could generate up to $2 million in revenue per year, according to Par Brumark, a domain name expert acting on Niue's behalf in the Swedish case.

Mr Semich has repeatedly denied Niue's claims of wrongdoing. In 2013, his company, Internet Users Society Niue, struck a deal to transfer the operation of .nu to the Swedish Internet Foundation, which manages the Swedish .se domain. Niue filed a lawsuit. A years-long procedural battle ensued, reaching all the way to the Swedish Supreme Court, until the legal system decided to hear Niue's case.

Jannike Tilla, vice-president of the foundation, dismissed Niue's claims against it, saying it was a subcontractor for IUSN. She added: “The domain is highly relevant for Swedish users, not least for many critical social institutions.”

For example, some Swedish newspapers have .nu in their web addresses. Websites currently using the domain are not expected to see any changes even if Niue wins the case.

IUSN asked questions to Emani Lui, a newly elected member of Niue's parliament. Mr Lui runs the only private internet provider in Niue, previously worked with IUSN and is the son of the prime minister who signed the original agreement with Mr Semich. He said the dispute over .nu had become so bitter that successive governments had lost sight of the other options Niue had.

“We would have had the best in the Pacific, probably one of the best communications systems in the world” if Niue had come face to face with IUSN, he said. “It wasn't picked up. It was more like: we want the money.”

Mr Tagelagi rejected that idea.

“It's morals. Every nation, regardless of size, must be treated fairly and equally,” he said. “We are sometimes overlooked because we are a small island in the big blue. But you can only be patient for so long.”