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ICANN terminates 450 drop-catch registrars

Kevin Murphy, November 6, 2017, 20:09:53 (UTC), Domain Registrars

Almost 450 registrars have lost their ICANN accreditations in recent days, fulfilling predictions of a downturn in the domain name drop-catch market.

By my reckoning, 448 registrars have been terminated in the last week, all of them apparently shells operated by Pheenix, one of the big three drop-catching firms.

Basically, Pheenix has dumped about 90% of its portfolio of accreditations, about 300 of which are less than a year old.

It also means ICANN has lost about 15% of its fee-paying registrars.

Pheenix has saved itself at least $1.2 million in ICANN’s fixed accreditation fees, not including the variable and transaction-based fees.

It has about 50 registrars left in its stable.

The terminated registrars are all either numbered LLCs — “Everest [1-100] LLC” for example — or named after random historical or fictional characters or magic swords.

The move is not unexpected. ICANN predicted it would lose 750 registrars when it compiled its fiscal 2018 budget.

VP Cyrus Namazi said back in July that the drop-catching market is not big enough to support the many hundreds of shell registrars that Pheenix, along with rivals SnapNames/Namejet and DropCatch.com, have created over the last few years.

The downturn, Namazi said back then, is material to ICANN’s budget. I estimated at the time that roughly two thirds of ICANN’s accredited registrar base belonged to the three main drop-catch firms.

Another theory doing the rounds, after Domain Name Wire spotted a Verisign patent filing covering a system for detecting and mitigating “registrar collusion” in the space, is that Verisign is due to shake up the .com drop-catch market with some kind of centralized service.

ICANN reckoned it would start losing registrars in October at a rate of about 250 per quarter, which seems to be playing out as predicted, so the purge has likely only just begun.

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Comments (16)

  1. JZ says:

    a centralized service? a monopoly on the drop catch money. sounds fair…not.

  2. james says:

    So were these registrars let go intentionally by Pheenix or were they terminated by ICANN?

    • Kevin Murphy says:

      My assumption is that they were intentionally let go. There have been no breach notices against them and I have no indication they did anything wrong.

      • james says:

        I would assume their catch rate could not compete with dropcatch and it did not pay to keep them any longer.

        • Kevin Murphy says:

          But note that ICANN is expecting to lose another 300 dropcatchers over the next seven months. Almost all of these will have to come from the other two big players.

          • james says:

            Another 300 registrar loses split between snapnames and dropcatch will not change a thing… Currently dropcatch is dominating the drop game by about 75% based on my analysis. Until Verisign takes action about “registrar collusion” things will remain the same with the two big players.

  3. Ryan says:

    So pheenix stopped making payments? Basically all held in #companies that will now dissolve in bad standing?

  4. NamePixie says:

    So what happens to the domains previously caught by these registrars and presumably still registered with them?

    • Kevin Murphy says:

      I’m not sure that’s how it works. I think they’re usually transferred out fairly quickly. Plus, the numbers of domains are pretty low, I think.

      • NamePixie says:

        I’m not certain they were unused or automatically transferred. For example, some of my domains caught by Pheenix have the following registrar URLs:

        Registrar URL: http://www. everest78-888.com
        Registrar: Everest 78, LLC
        Registrar IANA ID: 3096

        Registrar URL: http://www. everest25-888.com
        Registrar Registration Expiration Date: 2018-05-24T21:26:21Z
        Registrar: Everest 25, LLC
        Registrar IANA ID: 3043

        Registrar URL: http://www. everest77-888.com
        Registrar Registration Expiration Date: 2018-06-06T22:02:31Z
        Registrar: Everest 77, LLC
        Registrar IANA ID: 3095

        Registrar URL: http://www. benjaminfranklin-888.com
        Registrar Registration Expiration Date: 2017-12-29T21:48:55Z
        Registrar: Benjamin Franklin 888, LLC
        Registrar IANA ID: 2296

        (Added spaces to url to not trigger the spam filter)

        All these domains are registered with Pheenix and managed through my Pheenix account but show a registration with these funny registrars – some of which possibly are the ones de-accredited or will be.

        • Dan says:

          When terminating accreditation voluntarily the registrar can specify the gaining registrar. So long as there are no compliance issues with the gaining registrar ICANN will allow this as a free ICANN approved transfer.

          If you wish to combine accreditations it’s relatively straight forward and cost-free.

    • Steve Gobin says:

      ICANN will organise a portfolio transfer to another registrar. When the terminated registrar has no compliance issue, it may generally choose to which registrar its portfolio should be transferred.

  5. Jempie says:

    Doesn’t this say it al:
    “I estimated at the time that roughly two thirds of ICANN’s accredited registrar base belonged to the three main drop-catch firms.”

  6. mr. bean says:

    W.L.S back on the table in some form?

    Research the W.L.S (waiting list service) Very interesting….

    P.S. your one of the few blogs i like to read. Candid and informative.

Leave a Reply to james