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Amazon and Google have been BEATEN by a non-profit in the fight for .kids

Kevin Murphy, August 5, 2019, Domain Registries

One of the longest-fought new gTLD contests has finally been resolved, with a not-for-profit bid beating out Google and Amazon.

Amazon last week withdrew its application for .kids, leaving Hong Kong-based DotKids Foundation the only remaining applicant.

DotKids now has a clear run at the gTLD, with only ICANN contracting and technical testing before .kids goes live in the DNS root. We could be looking at a commercial launch within a year.

It’s a surprising outcome, not only because Amazon has all the money in the world, but also because it actually has a product called the Echo Dot Kids Edition, a candy-striped, parentally-controlled version of its creepy corporate surveillance device.

The fight between the two applicants was settled privately.

While ICANN has scheduled them in for a “last resort” auction more than once, the contention set was “On Hold” due to DotKids’ repeated use of ICANN appeals processes to delay.

My understanding is that it was not an auction. I don’t know whether any money changed hands to settle the dispute. It may just be a case of DotKids beating Amazon in a war of attrition.

DotKids, much like ultimately successful .music applicant DotMusic, pulled every trick in the book to delay .kids going to auction.

It’s filed no fewer than four Requests for Reconsideration with ICANN over the last five years, challenging almost every decision the organization made about the contention set.

Last year, DotKids (which had a reduced application fee under ICANN’s applicant support program) even asked ICANN for money to help it fight Amazon and Google at auction, then filed an RfR when ICANN refused.

The company has been in a Cooperative Engagement Process — a precursor to more formal appeals — with ICANN since February.

DotKids until recently also faced competition from Google, which had applied for the singular .kid but withdrew its application last October.

DotKids Foundation is run by Edmon Chung, perhaps best-known as the founder and CEO of 2003-round gTLD .asia.

I can’t help but feel that he has grasped a poison chalice.

The two examples we have of child-friendly domains to date are .kids.us, which was introduced by point-scoring US politicians under the Bush administration and promptly discarded when (almost literally) nobody used it, and .дети, the Russian equivalent, which usually has fewer than a thousand names in its zone file.

I believe that would-be registrants are broadly wary of signing up to vague content restrictions that could prove PR disasters if inadvertently violated.

In its 2012 application, DotKids said that .kids “will have a core mandate to advocate the production and publishing of more kids friendly content online”.

But what is a “kid”? DotKids said it would adopt the United Nations Convention on the Rights of Child definition as “every human under 18 years old”.

Because the parents of every five-year-old would be happy for their kid to view sites designed for 17-year-olds, right?

It’s going to be challenging to get this one right, I think.

Radix releases huge amount of premium domain data

Radix made $1,360,865 from premium domain names in its portfolio of new gTLDs in the first half of the year, according to the company’s latest report.

The company said that $522,365 of that came from new registrations — there were 619 in total — with the balance of $838,500 coming from renewals.

Radix is one of the registries that charges a premium fee every year over the life of the registration.

Because of this, its first-year renewal rates for premiums are not fantastic — just 54% of names registered in the first half of 2018 were renewed a year later.

But older premiums renewed at a more-than-respectable 78%, comparable to peak-.com, according to the Radix report.

.store and .online accounted for about half of renewal revenue.

.online and .tech accounted for more than half of new registration revenue.

GoDaddy sold 41.6% of all the names moved in the half.

For Radix, a premium domain is anything priced at $100 or above. That’s lower than some gTLDs’ base non-premium fee.

It sold three names at $10,000 during the period.

Now auDA loses its CEO too

The CEO of Australian ccTLD registry auDA has quit, just weeks after the organization’s chair resigned.

Cameron Boardman submitted his resignation yesterday, according to a statement.

Former chair Chris Leptos also quit last month, reportedly after a disagreement with Boardman.

Boardman said he wants “to seek new challenges”.

His functions will be carried out by other members of the executive team while a replacement is sought by the board.

Boardman joined as CEO in March 2016, after 16-year veteran Chris Disspain was fired.

For much his tenure, auDA has been beset by controversy, with fights between the board and members leading to government review, several board resignations, police investigation, and a seemingly endless series of tit-for-tat allegations.

Boardman was among four auDA directors who survived a no-confidence vote brought by domain investors last year.

Porn blocks could be worth millions to MMX

Minds + Machines could find itself making millions of dollars a year out of non-resolving defensive registrations in its recently acquired portfolio of porn-themed gTLDs.

The company recently announced the launch of AdultBlock and AdultBlock Plus, which will enable trademark owners to prevent anyone else registering their marks, and variants thereof, for up to 10 years.

Running the numbers, and taking into account MMX’s already substantial established client base for such services, AdultBlock could bring in as much as $11 million a year. But it’s almost certainly going to be much less than that.

The company won’t disclose it’s exact pricing for AdultBlock, or its revenue estimates, but it’s possible to do some back-of-the-envelope calculations and come to some ball-park guesses.

MMX has said that it’s pricing the service such that customers should be able to see a 35% saving compared to the cost of registering a single string across all four of its porn TLDs

The company acquired .xxx, .porn, .adult and .sex when it bought ICM Registry last year.

The wholesale fee for each of the four is believed to be about $68 a year. From this, we can calculate that the wholesale price of AdultBlock may well be around the $175-a-year mark.

There’s some room for error here, as MMX hasn’t revealed precisely how it came to its 35% number, but I think we can safely say we’re looking at $150 to $200 a year. For the purposes of this envelope, let’s split the difference and assume it’s $175.

It’s quite a high number, a bit like a recurring sunrise fee for a domain that you don’t even get to use.

But how many domains can MMX expect to be blocked?

A low-ball estimate could be modeled on the .porn/.adult/.sex sunrise periods.

.porn launched in 2015 and gathered 2,091 sunrise registrations, according to ICANN records, making it one of the largest new gTLD sunrise periods. The other two TLDs weren’t far behind.

If that’s a good guide for AdultBlock uptake, we’re talking about a piddling $360,000-a-year business.

But MMX has a secret weapon that it inherited from .xxx.

When .xxx launched back in 2011, it kicked off with two sunrise periods. Sunrise A was for trademark owners in the porn business who wanted to use their .xxx names. Sunrise B was for everyone else, who didn’t.

In Sunrise B, brand owners paid $162 (plus their registrar’s markup) to block their domains for a flat period of 10 years.

Customers couldn’t use their domains. They were registered to ICM and used specially designated ICM name servers to resolve to a standard, non-monetized placeholder page stating “This domain has been reserved from registration.”

There are over 80,000 domains using these name servers, but about 15,000 of those represent names of celebrities, cities, and religiously and culturally sensitive terms that ICM culled from Wikipedia and unilaterally reserved to help avoid a tabloid crucifixion if mileycyrus.xxx ever started bouncing children to something pornographic, such as one of her music videos.

(As an aside, I think it’s worth mentioning that the .xxx zone file only has 93,000 names in it. These means about nine out of 10 live .xxx domains are reserved by the registry.)

So we’ve got 65,000 trademarks that are currently blocked in .xxx, and they’re all going to expire in 2021 because ICM only sold blocks for the duration of its original 10-year ICANN contract.

If all 65,000 domains are upgraded to AdultBlock, the service would be worth over $11 million a year, to a company currently reporting annual revenue around $15 million.

But they won’t.

You don’t have to scroll too far down the .xxx zone file (and I didn’t) to discover some absolute garbage, no doubt the result of scaremongering around the 2011 .xxx launch.

I mean, seriously, look at some of this Sunrise B guff:

100percentwholewheatthatkidslovetoeat.xxx, 101waystoleaveagameshow.xxx, 1firstnationalmergersandacquisitions.xxx, 1stchoiceliquorsuperstore.xxx, 2bupushingalltherightbuttons.xxx, 247claimsservicethesupportyouneed30minutesguaranteed.xxx, 3pathpowerdeliverysystembypioneermagneticsinc.xxx

I think we’re going to be looking at a significant junk drop of blocked domains come 2021.

That said, I think MMX may have a psychological advantage here, when it comes to persuading Sunrise B users to “renew”.

Who hasn’t renewed a domain name they strongly suspect they will never use or sell, simply because they couldn’t bear the thought of somebody else owning “their” domain?

An additional consideration for brand owners is that these Sunrise B names are going to show up on drop-lists when they are eventually deleted from the .xxx zone file, perhaps giving inspiration to cybersquatters.

This is a fantastic opportunity for MMX and brand protection registrars to put the hard sell on its Sunrise B customers to “renew” their blocks by upgrading to the new and improved AdultBlock service, which could cost literally 10 times more than what they originally signed up for.

AdultBlock is of course more comprehensive than Sunrise B. It covers three additional TLDs, for starters, and customers can pay a little more for potentially thousands of potential homographs (non-Latin-script domains that look almost identical to the original) to also be blocked.

MMX isn’t waiting until 2021, however. It’s currently offering companies that buy a 10-year-block before the end of 2019 the AdultBlock+ service for the price of the vanilla, no-variants offering.

Existing Sunrise B customers have until the same deadline to purchase the new service without having to have their trademarks re-verified, which carries an additional fee.

For those that miss this early-bird offer, come December 2021, the holders of up 65,000 trademarks are going to face a stark choice: sign up to pay a couple hundred bucks a year, or risk their brands being snapped up by pornsquatters.

Cryptocurrency firms to be banned from .bank

The registry for the already heavily restricted .bank and .insurance gTLDs wants to change its policies to make it clear that cryptocurrency firms are not welcome.

fTLD Registry Services has opened up a public comment period on proposed changes to its eligibility policies for the two TLDs which would drop the “service provider” category of registrant.

It would also clarify that eligible entities have to be “retail” banks regulated by a proper government authority.

The elimination of “service providers” is an effort to clarify that .bank is for banks and not peer-to-peer or cryptocurrency payment providers.

Heather Diaz, senior director of compliance and policy at fTLD, told us that the service provider category was created to allow “banking core processors” and the like to register domains. She said in an email:

More recently, as the financial services arena has evolved, particularly as it relates to fintechs offering financial products/services (e.g., P2P payment providers, cryptocurrency companies), we have found that some prospective Registrants were seeking domains to enhance their legitimacy to market to regulated entities and/or consumers.

By eliminating the category, fTLD hopes to clarify that .bank is just for regulated banks.

Registrants that already own service provider domains (it sounds like there are only one or two) would be grandfathered under the proposed policy, so nobody’s going to lose their existing domains.

The proposed changes were boiled up by fTLD’s bank-led Advisory Committee and its board of directors.

Comments are being accepted until August 24, after which the company’s board will decide whether to implement the new policies.

Cybersquatting cases down a bit in the UK

The number of cybersquatting complaints filed with Nominet declined slightly in 2018, according to the registry.

Nominet’s Dispute Resolution Service, which is a bit like the UDRP, handled 671 cases last year, compared to 712 in 2017.

The number of domains at issue was down from 783 to 763.

The slight decline appears to be because fewer complaints were filed against .org.uk, .me.uk and plain .uk domains.

The number of .co.uk registrations challenged was flat between 2017 and 2018 at 617 domains.

Only 49% of cases resulted in the disputed domain being transferred, according to the registry’s annual report (pdf).

Looks like .fans has a new Chinese owner

It appears that the struggling new gTLD .fans has changed ownership for the second time in a year.

According to ICANN’s web site, the .fans Registry Agreement was assigned to a company called ZDNS International on June 28.

Since August 2018, the contract had been in the hands of a CentralNic subsidiary called Fans TLD, having been originally operated by Asiamix Digital.

ZDNS International appears to be a newish Hong Kong subsidiary of major China-based DNS service provider ZDNS.

ZDNS provides DNS services for more than 20 TLDs, mostly Chinese-language, but as far as I can tell it is not the contracted party for any.

It’s also known for providing registry gateway services for non-Chinese registries that want to set up shop in the country.

CentralNic took over .fans last year after Asiamix failed to get the TLD’s sales to take off.

.fans had about 1,700 domains under management at the time, and it’s been pretty much flat ever since. I don’t think CentralNic has been promoting it.

Over the same period, singular competitor .fan, which Donuts acquired from Asiamix last year, has gone from 0 to almost 3,000 registrations.

If CentralNic, a public company, made a profit on the flip it does not appear to have been material enough to require disclosure to shareholders.

Neustar to keep .us for another decade

Neustar has secured a renewal of its contract to run the United States’ ccTLD until up to 2029.

The company and the National Telecommunications and Information Administration announced the new contract last week.

The initial term of the deal runs until August 2021, but there are four two-year renewal options after that.

Neustar has been running .us since 2001. It doesn’t pay NTIA for the privilege, nor does the NTIA pay Neustar.

There are currently around two million registered .us domain names. The TLD appears to be still growing, but not especially fast.

MMX to pay $5.1 million to get out of terrible .london deal

Minds + Machines will pay its partner on .london roughly $5.1 million in order to put the catastrophic deal to bed for good.

That’s a reduction from the $7.9 million liability it had previously estimated.

The company said last week that it will pay an unspecified partner the $5.1 million “as full and final settlement for any further liability or contractual spend” after renegotiating the contract.

In April, MMX said that the deal had cost it $13.7 million since the outset.

While MMX has never publicly fingered the contract in question, which has been a pair of concrete boots for years, its deal with .london’s London & Partners is the only one that fits the bill.

The registry secured L&P, the marketing arm of the London Mayor’s office, as a client during the mayoral reign of Boris Johnson, the man set to be anointed the UK’s next prime minister this week.

It agreed to make millions of dollars in guaranteed payments over the duration of the contract, because it expected to sell a shedload of .london domains.

That never happened. The gTLD peaked at 86,000 names in March 2018 and was down to 54,000 a year later, evidently a fraction of what MMX had planned for.

The renegotiated deal — I believe at least the second time the deal has been amended — is “in principle” for now, with formal approval expected soon.

In its trading statement last week, MMX also said that the first half of the year ended with a 19% increase in regs, ending June at about 1.82 million.

It said it has “stabilised” declining billings in its acquired ICM Registry portfolio of porn-themed TLDs at $2.8 million, and that it has a “clear pathway” to growth from the four zones.

It’s hoping “further new initiatives” — likely a reference to a new trademark-blocking service — will help out in the current half.

MMX also said that it’s spending $1 million of its cash reserves on a stock buyback.

ZADNA boss canned for “misconduct”

The CEO of South African ccTLD manager ZADNA has been fired after a “misconduct” investigation lasting over half a year.

Vika Mpisane had been suspended from the role since early December, according to local reports, with Peter Madavhu taking his place.

Madavhu will continue as acting CEO until further notice, ZADNA told its members last week. A July 17 letter from chair Motlatjo Ralefatane, seen by DI, said:

Members would recall that Mr Vika Mpisane was on suspension pending the disciplinary hearing, which has been concluded.

Stemming from those disciplinary actions, Mr Vika Mpisane’s employment as the Chief Executive Officer of ZADNA has been terminated with effect from 16 July 2019.

The specifics of Mpisane’s alleged wrongdoings are not known. The fact that he had been suspended was not even public knowledge until MyBroadband scooped the story in May.

It has previously been reported that he was suspended for “for serious hybrid acts of misconduct including mismanagement of ZADNA funds”.

A disciplinary process that kicked off in January has reportedly been delayed multiple times, during which time Mpisane continued to draw a salary.