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Radix premium revenue hits $3.8 million in first half

Kevin Murphy, August 18, 2022, Domain Registries

New gTLD portfolio registry Radix this week gave its twice-yearly premium domain sales report, declaring first-half revenue of $3.8 million.

That figure includes $2.5 million in renewal revenue from premium-priced names, because Radix charges premium renewal fees.

For Radix, premiums sold through the registrar channel are arranged into eight tiers from $100 to $10,000 a year. While there were eight sales at the top end, most sales were concentrated in the $500-and-below tiers.

The average first-year revenue was $558 per domain.

There were 1,767 premiums sold across the stable of 10 gTLDs, compared to 1,378 in the second half of 2021 and 1,436 in H1 2021.

.tech is the highest-performing, with $643,825 of recurring retail renewal revenue reported.

Radix renewals drive growth as revenue hits $38 million

New gTLD registry Radix brought in revenue of $38 million in 2021, up 35% on the year before, the privately held company said today.

Profit was up 60% over the same period, Radix said, without disclosing the dollar amount.

It made almost as much in renewal revenue in 2021 as it made overall in 2020 — $27 million versus $17.9 million in the prior year. Last year 72% of revenue was standard-fee renewals versus 64% in 2020.

But the revenue from new regs was basically basically flat at $5.7 million versus $5.6 million — 15% versus 20% of overall revenue.

Revenue from premium-tier domains (both new regs and renews) was 12.5% of revenue, or $4.75 million, up from $4.5 million in 2020.

The customer country mix may be a little broader too. Radix said 47% of revenue now comes from the US, which is down from the 64% it reported for the previous year.

The company said .online is still the strongest performer in its portfolio.

Mutually assured destruction? Now Afilias faces .web disqualification probe

Kevin Murphy, March 15, 2022, Domain Policy

Afilias’ ongoing quest to have Verisign’s winning bid for the .web gTLD thrown out may have backfired, with ICANN now launching a probe into whether Afilias’ own bid should be disqualified.

Afilias and Verisign could now BOTH be kicked out of the .web fight, delivering the coveted gTLD into the hands of the third-placed bidder for a knock-down price.

There’s even the possibility that Verisign’s winning $135 million bid could be more than cut in half, taking tens of millions out of ICANN’s coffers.

ICANN’s board of directors on Thursday said it will investigate not only whether Verisign broke new gTLD program rules by using a Nu Dot Co as proxy to bid, but also whether Afilias broke the rules when an executive texted NDC during a pre-auction comms blackout period.

It’s the first time board has resolved to take a look at the allegations against Afilias, which so far have only come up in letters and arbitration filings from Verisign and NDC.

The .web auction in 2016 resulted in a winning bid of $135 million from NDC. It quickly emerged that its bid was bankrolled by Verisign, which had not directly applied for .web.

Afilias’ applicant subsidiary (now called Altanovo Domains, but we’re sticking with “Afilias” for this story) has been trying to use Verisign’s sleight-of-hand to get the auction overturned for years, on the basis that ICANN should have forced NDC to show its cards before the auction took place.

An Independent Review Process panel last year ruled that ICANN broke its own bylaws by failing to rule on Afilias’ allegations when they were first made, and told ICANN to put .web on hold while it finally formally decides whether Verisign broke the rules or not.

What the IRP panel did NOT do was ask ICANN to rule on Verisign’s counter-allegations about Afilias violating the auction blackout period. ICANN’s decided to do that all by itself, which must piss off Afilias no end.

The board resolved last week, with my emphasis:

Resolved (2022.03.10.06), the Board hereby: (a) asks the [Board Accountability Mechanisms Committee] to review, consider and evaluate the allegations relating to the Domain Acquisition Agreement (DAA) between NDC and Verisign and the allegations relating to Afilias’ conduct during the Auction Blackout Period; (b) asks the BAMC to provide the Board with its findings and recommendations as to whether the alleged actions of NDC and/or Afilias warrant disqualification or other consequences, if any, related to any relevant .WEB application; and (c) directs ICANN org to continue refraining from contracting for or delegation of the .WEB gTLD until ICANN has made its determination regarding the .WEB application(s).

I see four possible outcomes here.

  • Nobody gets disqualified. Verisign wins .web and ICANN gets to keep its $135 million. Afilias will probably file another IRP or lawsuit.
  • Verisign gets disqualified. Afilias gets .web and ICANN probably gets paid no more than $79.1 million, which was its maximum bid before the auction became a two-horse race. Verisign will probably file an IRP or lawsuit.
  • Afilias gets disqualified. Verisign wins .web and then it has to be figured out how much it pays. I believe the high bid before the third-place bidder pulled out was around $54 million, so it could be in that ball-park. Afilias will probably file another IRP or lawsuit.
  • Both Afilias and Verisign get disqualified. The third-placed bidder — and I don’t thinks its identity has ever been made public — wins .web and pays whatever their high bid was, possibly around $54 million. Everyone sues everyone else and all the lawyers get to buy themselves a new summer home.

The other remaining applicants are Donuts, Google, Radix and Schlund. Web.com has withdrawn its application.

The people who will decide whether to disqualify anyone are the six members of the Board Accountability Mechanisms Committee who are not recusing themselves due to conflicts of interest (Edmon Chung has a relationship with Afilias).

Given that the board has already ruled that it has a fiduciary duty to dip into the new gTLD auction proceeds pretty much whenever it pleases, can’t we also assume that it has a fiduciary duty to make sure that auction proceeds pool is as large as possible?

Domain firms plan “Trusted Notifier” takedown rules

Kevin Murphy, June 23, 2021, Domain Policy

Domain name registries and registrars are working on a joint framework that could speed up the process of taking down domain names being used for behavior such as movie piracy.

Discussed last week at the ICANN 71 public meeting, the Framework on Trusted Notifiers is a joint effort of the Registrar Stakeholder Group and Registries Stakeholder Group — together the Contracted Parties House — and is in the early stages of discussion.

Trusted Notifiers are third parties who often need domain names taken down due to activity such as copyright infringement or the sale of counterfeit pharmaceuticals, and are considered trustworthy enough not to overreach and spam the CPH with spurious, cumbersome, overly vague complaints.

It’s not a new concept. Registries in the gTLD space, such as Donuts and Radix, have had relationships with the Motion Picture Association for over five years.

ccTLD operator Nominet has a similar relationship with UK regulators, acting on behalf of Big Copyright and Big Pharma, taking down thousands of .uk domains every year.

The joint RrSG-RySG effort doesn’t appear to have any published draft framework yet, and the discussions appear to be being held privately, but members said last week that it is expected to describe a set of “common expectations or common understandings”, establishing what a Trusted Notifier is and what kind of cooperation they can expect from domain firms.

It’s one of several things the industry is working on to address complaints about so-called “DNS Abuse”, which could lead to government regulations or further delays to the new gTLD program.

It obviously veers into content policing, which ICANN has disavowed. But it’s not an ICANN policy effort. Whatever framework emerges, it’s expected to be non-contractual and voluntary.

Trusted Notifier relationships would be bilateral, between registry and notifier, with no ICANN oversight.

Such deals are not without controversy, however. Notably, free speech advocates at the Electronic Frontier Foundation have been complaining about Trusted Notifier for years, calling it “content policing by the back door” and most recently using it as an argument against Ethos Capital’s acquisition of Donuts.

Locked-down .music could launch this year

One of the most heavily contested new gTLDs, .music, could launch this year after new registry DotMusic finally signed its Registry Agreement with ICANN.

The contract was signed over two years after DotMusic prevailed in an auction against Google, Amazon, Donuts, Radix, Far Further, Domain Venture Partners and MMX.

It seems the coronavirus pandemic, along with ICANN bureaucracy, was at least partly to blame for the long delay.

I speculated in April 2019 that .music could launch before year’s end, but this time DotMusic CEO Constantinos Roussos tells me a launch in 2021 is indeed a possibility.

The contract the company has signed with ICANN contains some of the most stringent restrictions, designed to protect intellectual property rights, of any I’ve seen.

First off, there’s going to be a Globally Protected Marks List, which reserves from registration the names of well-known music industry companies and organizations, and platinum-selling recording artists.

Second, registrants are going to have to apply for their domains, proving they are a member of one of the registry’s pre-approved “Music Community Member Organizations”, rather than simply enter their credit card and buy them.

DotMusic will verify both the email address and phone number of the registrant before approving applications.

There’s also going to be a unique dispute resolution process, a UDRP for copyright, administered by the National Arbitration Forum, called the .MUSIC Policy & Copyright Infringement Dispute Resolution Process (MPCIDRP).

Basically, any registrant found to be infringing .music’s content policies could be slung out.

The content policies cover intellectual property infringement as you’d expect, but they also appear to cover activities such as content scraping, a rule perhaps designed to capture those sites that aggregate links to infringing content without actually infringing themselves.

The registry is also going to ban second-level domains that have been used to infringe copyright in other TLDs, to prevent the kind of “TLD-hopping” outfits like The Pirate Bay have engaged in in the past.

In short, it’s going to be one of the least rock-n-roll TLDs out there.

Tightly controlled TLDs like this tend to be unpopular with registrars. Despite the incredibly strong string, my gut feeling is that .music is going to be quite a low-volume gTLD. There’s no word yet on pricing, but I’d err towards the higher end of the spectrum.

Universal Acceptance – making the internet work for everyone [Guest Post]

Kevin Murphy, March 24, 2021, Domain Tech

Editor’s note: this is a guest post written by Aman Masjide, head of compliance at new gTLD registry Radix.

Back in 2014, to foster innovation and to better the choice in domain names, ICANN introduced new generic top-level domains through its New gTLD Program. It was a monumental move that enabled businesses, individuals, and communities across the globe to mark their presence on the internet.

Allowing users to be present digitally in their chosen language (non-ASCII characters and scripts) gave opportunities to local businesses, civil societies, and governments to better serve their communities.

Analysys Mason conservatively estimates that there is scope of $9.8 billion growth in potential revenue from both; existing users who are using new domain names and from new internet users coming online through Internationalized Domain Names (IDNs).

To achieve this, Universal Acceptance of new gTLDs and IDNs is critical in making the Internet more accessible to the next billion users. Founded in February 2015, the Universal Acceptance Steering Group (UASG) undertakes activities to promote Universal Acceptance of all valid domain names and email addresses.

Through its ambassadorship and local Initiative programs, UASG promotes Universal Acceptance globally. Their efforts are divided and executed through five working groups that include:

  • Technology Working Group
  • Email Address Internationalization Working Group
  • Communications Working Group
  • Measurement Working Group
  • Local Initiatives Working Group

Before we get into the acceptance of new domain extensions (nTLDs), we must first understand what acceptance means and how it’s measured.

The Universal Acceptance Steering Group’s mission sums up acceptance in one short statement: “All domain names and all email addresses work in all software applications.”

While this is a simple understanding of the concept, for an end user of an nTLD, this statement further branches out into multiple questions such as:

  • Will my domain name work on all platforms/applications–online or offline?
  • Will my email address on a new domain extension get accepted on all websites/platforms and pass all the validation tests?
  • Will my emails on new domain extensions, once accepted, stop going into the junk folder?
  • Will I be able to use all the features of a website/platform irrespective of my domain extensions? For example, will a social media platform accept a new domain extension in the bio, comments, posts, messenger, etc, and process it exactly like any other legacy TLD?

The Universal Acceptance (UA) of all domain names and email addresses requires that every piece of software is able to accept, validate, process, store, and display them correctly and consistently.

As a new domains registry, it was critical for us to understand what the gaps were and how to close them so that the internet operates the same for nTLD users as it does for the legacy TLD users.

Initial research concluded that UA readiness issues occur when applications are not able to handle the following categories of a domains name or email addresses:

Domain Names

  • New short top-level domain names: example.fun, example.site
  • New long top-level domain names: example.berlin, example.space
  • Internationalized Domain Names: παράδειγμα.ευ

Email Addresses

  • ASCII@ASCII; new short or long TLD: ekrem@misal.istanbul
  • ASCII@IDN: john@société.org
  • Unicode@ASCII: 测试@example.com
  • Unicode@IDN: ईमेल@उदाहरण.भारत
  • Unicode@IDN; right to left scripts: لیم@لاثم.عقوم ای

For Universal Acceptance to succeed, it needs to be examined holistically.

Over the years, UASG working group members have conducted several gap analysis on programming languages and frameworks, networking command-line tools, web browsers, websites, and have made great strides in acceptance of new domain extensions.

According to UASG’s FY 2020 report, tests conducted on top websites showed that

  • The acceptance rate of emails on short nTLDs has increased from 91% in 2017 to 98.3% in 2020.
  • The acceptance rate of emails on long nTLDs has increased from 78% in 2017 to 84.8% in 2020.

table

Note: The table above compares the 2020 results to the earlier 2017 and 2019 testing results.

Two important caveats should be remembered in this case:

  • Different email addresses were tested (but they were of the same type).
  • The websites tested in 2020 were different from previous ones as they were the 50 most popular in the 20 countries rather than the 1,000 most popular globally.

However, these results may still be used to compare overall trends.

Universal Acceptance Readiness Report 2020 (pdf) also segregated test websites as per different categories such as eCommerce, government, education, etc and the results were promising.

table

Such studies help UASG ambassadors and advocates to identify and focus on websites of a specific category that require immediate attention. We conducted a similar study at Radix where we analysed top websites belonging to different categories. These were the results (click to enlarge):

table

While the acceptance rates for new short and new long cases is more than 80% under most categories, we see a drastic dip when a domain is on an IDN TLD. Such comparisons highlight problem areas and provide direction to ambassadors and members who are advocating for Universal Acceptance.

Radix’s contribution to UASG

UA is something that affects nTLD users the most. This is why it’s crucial to focus on the feedback that we receive from them. At Radix, we work closely with our users to ensure we have the first hand information on any UA related issues faced by the customer.

The feedback could be about linkification, validation or acceptance of emails on nTLDs on different websites and platforms. Radix also actively invests its resources in gap analysis by testing various websites and social media platforms. We are also part of the ambassadorship program promoting and supporting local and global UA initiatives.

Here are some of the UASG initiatives that Radix is part of:

At Radix, our objective is to ensure that nTLDs are accepted across websites and platforms. To achieve this, we actively work with UASG and share as many issues and gaps noticed and reported by customers.

Contribution by other registries

A key objective for most registries is to ensure great customer experience when it comes to their nTLDs and I’ve always admired it when registry operators have actively taken initiative and participated in the five UASG groups mentioned above.

One of the ways to do this is to capture all the queries and complaints reported by their customers/registrar partners and share it with UASG. This will help their support team direct their resources in solving the problems and encouraging those websites to become UA compliant.

Contribution by registrars

When it comes to UA-related issues, registrars are the first in chain to receive a complaint or feedback from the user. Therefore, it’s crucial that their support teams have all the necessary information needed on how to best handle such complaints.

For now, they can:

  • Inform the customer about the potential UA issue and raise a request on behalf of the customer with UASG. Issues can be logged at – https://uasg.tech/global-support-center/
  • Report these instances to the Registry Operator so that they can connect and follow up with UASG.
  • Join any of the five working groups and participate.

The path ahead

The UASG is consistently compiling and sharing all the important information needed for organizations and developers to become UA ready. This is not only about ensuring the readiness of a system to accept certain TLDs or emails, but also about realising the full potential of an organization by connecting with people and businesses that might not be even on it’s radar.

Every successful step taken by an organization towards UA readiness is also a step towards equality and inclusiveness on the internet.

Guest poster Aman Masjide leads compliance and abuse mitigation at Radix.

.hotel battle lands ICANN in court over accountability dodges

Kevin Murphy, February 22, 2021, Domain Policy

ICANN’s accountability mechanisms, or lack thereof, have landed the Org in court.

Three applicants for the .hotel new gTLD have sued in California’s Superior Court in LA, claiming ICANN has consistently failed to provide true accountability, refusing for over seven years to implement fundamental mechanisms required by its bylaws.

They want the court to force ICANN to stick to its bylaws and to also temporarily freeze an Independent Review Process case related to .hotel.

The registries in question are Fegistry, Domain Venture Partners and Radix. They filed their complaint at the end of October, but ICANN did not publish it until the end of January, after its terse reply, and an administrative ruling, had also been filed with the court.

While the endgame is presumably to get the .hotel contention set pushed to auction, the lawsuit barely mentions the gTLD at all. Rather, it’s a broad-ranging challenge to ICANN’s reluctance to submit to any kind of accountability at all.

The main beef is that ICANN has not created a so-called “Standing Panel” of judges to preside over IRP cases, something that its bylaws have required since 2013.

The Standing Panel is meant to comprise seven legal experts, trained up in all things ICANN, from which the three panelists presiding over each IRP would be selected.

It would also operate as a final appeals court for IRP rulings, with all seven panelists involved in such “en banc” challenges.

The idea is to have knowledgeable panelists on a retainer to expedite IRPs and ensure some degree of consistency in decision-making, something that has often been lacking in IRP decisions to date.

Despite this requirement being in the bylaws since 2013, ICANN has consistently dragged its feet on implementation and today there still is no Standing Panel.

The .hotel plaintiffs reckon ICANN has dodged $2.7 million in fees by refusing to pick a panel, all the while offloading certain fees onto complainants.

It didn’t get the ball rolling until January 2018, but the originally anticipated, rather streamlined, selection process quickly devolved into the usual mess of ICANN bureaucracy, red tape and circular community consultation.

The latest development was in November 2020, when ICANN announced that it was looking for volunteers for a cross-community “IRP Community Representatives Group”, a team similar to the Nominating Committee. which would be responsible for picking the Standing Panel members.

The deadline to apply was December 4, and we’ve not heard anything else about the process since.

The .hotel litigants also have beef with the “sham” Request for Reconsideration process, which is notorious for enabling the board to merely reinforce its original position, which was drafted by ICANN staff lawyers, based on advice provided by those same ICANN staff lawyers.

They also take aim at the fact that ICANN’s independent Ombudsman has recused himself from any involvement in Reconsideration related to the new gTLD program, for unclear reasons.

The lawsuit (pdf) reads:

ICANN promised to implement these Accountability Mechanisms as a condition of the United States government terminating its formal oversight of ICANN in 2016 — yet still has wholly failed to do so.

Unless this Court forces ICANN to comply with its bylaws in these critical respects, ICANN will continue to force Plaintiffs and any other complaining party into the current, sham “Reconsideration” and Independent Review processes that fall far short of the Accountability Mechanisms required in its bylaws.

The plaintiffs say that ICANN reckons it will take another six to 12 months to get the Standing Panel up and running. The plaintiffs say they’re prepared to wait, but that ICANN is refusing and forcing the IRP to continue in its absence.

They also claim that ICANN was last year preparing to delegate .hotel to HTLD, the successful applicant now owned by Donuts, which forced them to pay out for an emergency IRP panelist to get the equivalent of an injunction, which cost $18,000.

That panelist declined to force ICANN to immediately appoint a Standing Panel or independent Ombudsman, however.

The .hotel plaintiffs allege breach of contract, fraud, deceit, negligence and such among the eight counts listed in the complaint, and demand an injunction forcing ICANN to implement the accountability mechanisms enshrined in the bylaws.

They also want an unspecified amount of money in punitive damages.

ICANN’s response to the complaint (pdf) relies a lot on the fact that all new gTLD applicants, including the plaintiffs in this case, signed a covenant not to sue as part of their applications. ICANN says this means they lack standing, but courts have differed of whether the covenant is fully enforceable.

ICANN also claims that the .hotel applicants have failed to state a factual case for any of their eight counts.

It further says that the complaint is just an effort to relitigate what the plaintiffs failed to win in their emergency hearing in their IRP last year.

It wants the complaint dismissed.

The court said (pdf) at the end of January that it will hold a hearing on this motion on DECEMBER 9 this year.

Whether this ludicrous delay is related to the facts of the case or the coronavirus pandemic is unclear, but it certainly gives ICANN and the .hotel applicants plenty of time for their IRP to play out to conclusion, presumably without a Standing Panel in place.

So, a win-by-default for ICANN?

UNR getting out of the registry business with $17 million no-reserve auctions on 23 new gTLDs

Kevin Murphy, January 27, 2021, Domain Registries

UNR, the former Uniregistry, plans to auction off its portfolio of 23 new gTLD contracts in April.

The company, owned by domain investor Frank Schilling, said on a new web site at auction.link:

In a move to completely dedicate the company and its resources to its backend registry and IP rights protection services, UNR has announced that 23 of its Top Level Domain assets will be sold in no-reserve auctions on April 28, 2021.

The TLDs will be sold individually, rather than as a package.

While they’re all no-reserve auctions, the published starting prices add up to $16,870,000. Some have minimum bids of zero, some are less than the price UNR paid ICANN for its application fee back in 2012.

Here’s a list of the TLDs, along with their starting prices.

[table “63” not found /]

The prices appear to be based on the reg fee and volume of existing registrations, which range wildly from around 300 for .hiv to 159,000 for .link. The .country gTLD, aimed at country music makers and fans, currently has no starting bid listed.

The most-likely buyers of these gTLDs would be the rapidly dwindling list of fellow portfolio registries, such as Donuts and Radix.

While UNR’s exit from the registry business may be surprising — Schilling was a big fan of new gTLDs and Uniregistry applied for 54 of them, investing $69 million — it’s merely the latest stage of the business being dismantled.

Uniregistry sold its registrar and secondary market businesses to GoDaddy last year, and later sold its stake in three car-related gTLDs to business partner XYZ.com.

UNR said the April auctions will be managed over one day by Innovative Auctions, which is pretty much the de facto standard player in new gTLD auctions.

While the company says the auctions are open to “businesses and individuals”, I’m pretty sure ICANN rules forbid a gTLD being owned by individuals.

The company now plans to focus on being a pure-play back-end registry services provider, with a focus on dot-brand gTLDs, where it will continue to compete with the likes of GoDaddy, CentralNic, Donuts and Verisign.

GoDaddy has a secret weapon in its push into corporate domains

Kevin Murphy, November 19, 2020, Domain Registrars

While GoDaddy has been focused for the last two decades on small and microbusiness customers, its entry this year into the corporate domains management space should not be dismissed — the company has one huge advantage.

Earlier this week, the company announced the launch of GoDaddy Corporate Domains, really just a rebranding of the company Brandsight, which it acquired back in February.

The move pits GoDaddy against industry leaders such as MarkMonitor, CSC, Com Laude, Safenames et al.

But the company has one huge advantage that its new competitors do not have: cybersquatters and criminals.

Buried at the bottom of this week’s press release is the announcement of a new service, the Verified Intellectual Property program, which “provides pre-vetted, well-known and famous brands an escalation path to address IP abuse”.

It sounds basically like a trusted notifier service not unlike those offered at the registry level by the likes of Donuts and Radix.

VIP clients will be able to get sites and domains hosted on GoDaddy taken down much quicker, via a special escalation email address, a spokesperson said. Takedown requests will still be subject to manual review, he said.

VIP is currently invitation-only, but I assume being a Corporate Domains customer would help expedite an invitation.

This kind of service is something GoDaddy’s new rivals cannot offer — they generally have no retail channel or hosting, so have no cyberquatters, pirates or counterfeiters as customers. If they want to take down a domain or web site, it’s not a simple matter of flipping a switch.

They also don’t have tens of millions of domains under management, many of which, through no fault of GoDaddy, will be maliciously registered.

This is potentially a pretty cool USP for GoDaddy, which could have rivals worried.

Radix premium renewals approach $1 million

Kevin Murphy, September 8, 2020, Domain Sales

New gTLD registry Radix made almost a million bucks in the first half of the year from renewal fees on its premium domains.

That’s one data point that jumps out from Radix’s latest premium sales report, released last night.

The company said that it made $1.96 million at the top line from premiums in the period, up 19% on the second half of 2019.

It added that $996,771 of that was from renewals, up from $903,687 in H2 2019.

Radix is one of the registries that charges a premium fee every year over the lifetime of the registration, a practice controversial among domain investors.

Still, it appears there is demand (or, at least, acceptance) among end users. Radix said it saw a 41% sequential increase in the number of premium sales in H1.

.tech, .online and .store were the biggest sellers, with the vast majority of sold names clustering in the $250 to $2,500 range.

The renewal rate after the first year was 63%, growing to 72% at the second renewal and a very respectable 78% thereafter.

Radix said it saw .store premium sales grow by more than fivefold during the half, which it attributed to the coronavirus pandemic:

While premium registrations and revenue have grown steadily for five quarters since Q2 2019, the 2020 pandemic has led to significant demand in eCommerce and have urged businesses from all verticals to build a strong web presence.

This has led to a surge in the adoption of premium domain names on meaningful extensions that are most suited for these businesses such as .STORE. Premium registrations for .STORE in Q2 2020 was up by 5.5X compared to Q2 2019.

More stats can be found here.