Hello,
A friend of mine is interested in buying a domain name and focusing
his marketing efforts on the German market. The service he provides
has an umlaut on one of the letters, but he's not sure whether search
engines (particularly Google, MSN and Yahoo) read letters with umlauts
on them. He knows that most people will search for his service using
the word "übersetzungen" but the domain "übersetzungen.ch" seems to
alias to something like xns---bersetzungen-xyz.ch and  wouldn't then
show up for the type of search enquiry he's after. I know some indexes
(e.g. Overture) consider "ue" and  "ü" to be interchangeable but think
it's possible there are lots that don't. Could you please advise
whether he'd be better off buying uebersetzungen.ch or
übersetzungen.ch from a search engine perspective?

Thanks,

Christian

I'm making this comment on the basis of common sense, not any
specialist knowledge. But it seems to me that if your friend is
focussing on the German market, then what matters is how is name
appears and is "searched for" on German search engines (eg Google.de)
and these must surely use normal German spelling including umlauts. It
would be quite unnatural for a German to use ue rather than ü.

I agree with what you say, but in this case it is very much about how
the computers read the letters rather than what is actually typed in.
Your input is appreciated.

Well I hope somebody else understands your point, but I'm afraid I
don't. I just searched for "übersetzungen" on Google, and got
1,210,000 references to "übersetzungen" with an umlaut. But on
searching for the word with ue instead of ü, I got "only" 275,000
references. To repeat, surely if your friend is aiming at the German
market, it's better to use the word with authentic German spelling,
rather than anglicised spelling.

Being a user of such domains since several years, I am glad to share
some of my experience:

As Swiss and speaking German, I definitively would choose
übersetzungen. The 'ue' version is only used in rare cases, were the
'ü' is not possible, e.g. in case of capital letters 'Ue' for which
Umlauts 'officially' do not exist (they did not for typewriters; you
can write 'Ü' with computers, but it is rarely used because not very
nice) - but as domains do not have capital letters the answer is
definitively 'ü'.

So called IDN's - or Internationalized Domain names are in an
implementation phase since this year: .com IDN names were sold by
Verisign since 2000, but were practically not useable before March
2004. Country level domains are now proposed in several countries, but
the public is still not used to them.
Reason: The Internet Explorer does not recognise domains in foreign
languages, for which a special add-in was developped by Verisign and
available at www.iddnow.com. Most people don't know it and therefore
don't have the addi-in; as a result their Browser will not be able to
recognise 'übersetzungen.ch' and return an error. Other 'advanced'
Browsers (Netscape 7.1, Mozilla 1.4 and higher e.g. Firefox) perform
already an inherent translation.

Regarding the search engines, fact is that google starts partly to
recognise IDNs. Partly for following reasons:

The 'spiders' ('robots' that read for new web pages) seem not yet
being able to manage IDN's (my interpretation). If as a sample you
enter 'beautés.com' as research, you will have no result returned,
except an indication like 'if beautés.com' is a valid domain address,
please click on it (the domain name is underlined and contains the
translated href link)' - and you will be directed to the concerned
website.

The 'xn--....' domain names you can notice the more and more in all
search engines are in fact such IDN's represented in their official
standard translation called 'punycode'. Even if you have an add-in to
your IE or use Netscape 7.1, the domain names are not translated but
are shonw in the xn-- style. I can imagine that it would be easy to
translate the xn-- names when shown on the result web-page, and I
don't uderstand what we wait for (by the way, one can find a
translator at the verisign web-address below). Therefore,
search-engines would not show websites with 'domain-names' with
umlauts, as they do not show the translated foreign domain name. For
sure, as the other comment states, you will have pages shown that have
the word 'übersetzungen' in the page itself.

As a sample, try to search at www.yahoo.com for 'polidias': you will
have as result, among others, a page with the domain name
'www.xn--ewq.com', which in fact is a japanese name. If one has an
add-in, it will show japanese caracters in the address bar once the
website is shown in the browser.

I intend to conclude by saying that the whole Internet industry is
awaiting for Microsoft to recognise and build-in an inherent solution
for IDNs. Not only Web-Browsers are concerned, but also Email software
and all software that handels internet addresses.

For additional information please refer to
http://www.verisign.com/products-services/naming-and-directory-services/naming-services/internationalized-domain-names/index.html
as well as http://www.minc.org/events/kl2004/index.shtml#papers which
will give you an update were the industry stands.

Hope I just saved you 30$ - how many stars do I get.....

Thank you Polidias. I think you have understood the issue exactly. 
It seems going for ue may prove futile longer term. This said, there
is (as you say) the issue of capitals - that for Ubersetzungen, for
example, the capital would mean no umlaut would be used anyway. Is
your experience that most Swiss people would put in the umlaut and
type things lower case? Or should we register ubersetzungen.ch to
cater for people typing it in in capitals?

Best Wishes,

Christian

Well, one can't know exactly what people will use. In fact, you should
ensure to have both names, www.uebersetzungen.ch and
www.übersetzungen.ch. Because in the mind of people they remember the
name, but not the way how it was written. So they (will) try both
ways. Otherwise you will have the risk of cybersquatting. You better
also ensure to have the .com name, because .coms have still an
important value.

Companies here in Switzerland ensure that they have always both ways.
Most known sample is: www.nestle.ch / www.nestlé.ch. (Nestlé is the
correct name).

Good luck