Single-letter names under ".com," ".net" and ".org" were set aside in 1993 as engineers grew concerned about their ability to meet the expected explosion in demand for domain names. They weren't sure then whether a single database of names could hold millions - more than 40 million in the case of ".com" today.
Six single-letter names already claimed at the time - "q.com," "x.com, "z.com," "i.net," "q.net," and "x.org" - were allowed to keep their names for the time being.
One idea was to create a mechanism for splitting a single database into 26 - one corresponding to each letter. So instead of storing the domain name for The Associated Press under ".org," it would go under "a.org." In other words, "ap.org" would become "ap.a.org."
http://www.forbes.com/business/feeds/ap/2005/11/28/ap2356300.html
http://news.com.com/2061-10796_3-5974204.html