Country code top level domains (ccTLD) are the two-letter endings of website addresses that are generally used to indicate pages are related to certain countries or geographic regions. For example, .li refers to websites in Lichtenstein and .io refers to domains in the Indian Ocean region.
These top-level domains may not have held much appeal to U.S. businesses in the past because sites were built on .com addresses. However, there are now a limited number of these available and many domains that would be relevant to businesses have already been purchased.
With cost and competition over these domains rising, webmasters have started to explore alternate TDLs, including those that previously belonged to other countries.
Matt Cutts said some webmasters have considered novelty names like Google.it, or looked into domains that relate to their geographic regions, such as .ky for Kentucky. This is not a best practice, according to Cutts (see this video for his guidance verbatim). It might be more difficult than expected to gain traction around these standout web addresses – no matter how memorable they might seem – if not because they’re unfamiliar to users, than because Google’s crawlers will likely group them with domains from those geographic regions in foreign search results.