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Verisign likely to get its billion-dollar .com pricing windfall

Kevin Murphy, October 28, 2019, Domain Registries

Verisign and ICANN appear to be on the verge of signing a new .com registry contract that could prove extremely lucrative for the legacy gTLD company.

Speaking to analysts following the announcement of Verisign’s third-quarter results late last week, CEO Jim Bidzos said talks with ICANN, which have their first anniversary this week, are “nearly complete”.

The new contract will take on the terms of the Cooperative Agreement between Verisign and the US Department of Commerce, which was amended a year ago to scrap an Obama-era price freeze.

Under the future contract, Verisign is expected to be able to raise its .com fee from its current $7.85 by 7% in four of the six years of the deal. As I wrote at the time, this could be worth close to a billion dollars.

This, for a company that already enjoys profit margins so generous that I regularly receive phone calls from perplexed analysts asking me to help explain how they get away with it.

Bidzos said on Thursday night:

let me remind you that under the 2016 amendment to our .com registry agreement with ICANN, which extended the term of the agreement, we and ICANN also agree to negotiate in good faith to do two things; first, we agree to reflect changes to the Cooperative Agreement in the com agreement, including pricing terms. Second, we agree to amend the com agreement to include terms to preserve and enhance the security and stability of the com registry or the internet.

We believe these discussions with ICANN are nearly complete. While it will be inappropriate at this time to provide more details, I can say that we were satisfied with the results so far. As noted, this is an ICANN process and we expect that before long ICANN will be publishing for public comment the documents we have been discussing.

The Cooperative Agreement also allows Verisign to launch a registrar business, just as long as that registrar does not sell .com domains.

Potentially, Verisign could get the right to launch a customer-facing registrar focused on selling .net, .org and newer gTLDs and ccTLDs.

Given we already pretty much know what the new pricing regime is going to be, the big mystery right now is why it’s taken ICANN and Verisign so long to renegotiate the contract.

One analyst asked Bidzos on Thursday whether ICANN has talked its way into getting a bigger slice of the registry fee, currently set at $0.25 per annual domain transaction.

That’s in-line with what almost all the other gTLD registries pay, and I can’t see ICANN demanding more without attracting a tonne of criticism. Verisign is already by some margin its biggest funding source.

Could ICANN have demanded that Verisign adopt the Uniform Rapid Suspension anti-cybersquatting policy, which would be guaranteed to enrage domain investors?

Whatever else is to be added to the contract, it appears to be related to that amorphous term “security and stability”, which could mean basically anything.

When ICANN and Verisign agreed to talk about new terms “to preserve and enhance the security and stability of the Internet or the TLD”, what on Earth where they talking about?

It looks like we won’t have to wait too much longer to find out.

Form an orderly queue: New Zealand wants a new back-end

Kevin Murphy, October 23, 2019, Domain Registries

New Zealand is looking to possibly outsource its .nz ccTLD registry back-end for the first time, and has invited interested parties to get in touch.

Registry manager InternetNZ today published a request for expressions of interest in what it’s calling its “registry replacement project”.

It won’t be as straightforward as most registry migrations, as .nz is currently running essentially two different back-ends.

Today, about 65% of its registrations are based on an outdated custom Shared Registration System protocol, with the remainder on the industry standard Extensible Provisioning Protocol.

The proportion of registrars running SRS versus EPP is roughly the same, with about 65% on SRS, according to the REOI.

But the registry wants to get rid of SRS altogether, forcing all SRS-only registrars to adopt the EPP, and the new back-end provider will have to support this transition.

While registrars always have a bit of implementation work to do when a TLD changes back-ends, it’s not usually as complicated as adopting a completely different protocol with which they may not be unfamiliar.

So the risk of issues arising during the eventual handover — which will probably take a bit longer than usual — is probably a bit higher than usual.

But .nz is an attractive TLD. At the start of the month, it had 711,945 domains under management, a pretty good penetration on a per-capita basis when compared to the biggest ccTLDs.

It’s in the top 50 of the 1,338 TLDs for which I have data.

The deadline for responses to the REOI is November 29, a little over a month from now, InternetNZ said.

The registry is taking briefings at ICANN 66 in Montreal from November 2, and the following week in New Zealand.

UPDATE: This article originally stated that InternetNZ has decided to outsource its back end. In fact, outsourcing is just one of a number of options.

Brexit hell: .eu suspension plan put on hold

Kevin Murphy, October 23, 2019, Domain Registries

EURid’s policy to boot out Brits next week has been put on hold due to the current impasse in Brexit talks.

UK citizens had been told they would lose their .eu domains November 1, the first day the country was scheduled to no longer be a member of the European Union.

But the October 31 exit date appears increasingly unlikely, with the divorce plan agreed to by the EU and UK Prime Minister Boris Johnson still in UK parliamentary limbo.

So EURid posted today:

Following the recent developments in the UK withdrawal scenario, the entire plan outlined below is on hold. We will keep you informed as soon as we receive further instructions from the European Commission.

Under the suspended plan, EURid would have emailed all of its UK and Gibraltar-based registrants tomorrow to inform them that their domains were in jeopardy.

It would have closed down new registrations to Brits on November 1 and given existing registrants a two-month grace period to come into compliance — by transferring their names to addresses in eligible nations — before suspending the names.

A year later, the names would be deleted and returned to the available pool.

EURid said it will provide further guidance when it gets word from the European Commission.

Now you don’t have to live in the EU to register a .eu domain, but there’s a catch

Kevin Murphy, October 21, 2019, Domain Registries

Residents of countries outside the European Union are now able to register .eu domain names.

A new rule that kicked in at the weekend broadened eligibility from only residents of the EU and European Economic Area. Now, residency is irrelevant.

The catch is that you have to still have to be an EU citizen to qualify.

EURid, the .eu registry, said the change opens up the ccTLD to “millions of Europeans living around the world”.

In practice, it could open up the space to basically anyone.

While residency can fairly easily be checked by looking at the mailing address in a Whois record, demonstrating citizenship is a different kettle of fish.

There’s no indication that EURid is asking registrars to collect passport numbers at the point of sale, so it appears to be a post-registration enforcement regime.

.eu is also still open to non-EU citizens who live in the EU or EEA.

.eu had 3.6 million names under management at the last count, having declined by about 200,000 since the Brexit vote three years ago.

Let’s see if the new, liberalized regime has any impact.

Google quietly launches .new domains sunrise

Kevin Murphy, October 14, 2019, Domain Registries

Google Registry will allow trademark owners to register domains matching their marks in the .new gTLD from tomorrow.

While the company hasn’t made a big public announcement about the launch, the startup dates it has filed with ICANN show that its latest sunrise period will run from October 15 to January 14.

As previously reported, .new is a bit of a odd one. Google plans to place usage restrictions that require registrants to use the domains in the pursuit of “action generation or online contention creation”.

In other words, it wants registrants to use .new in much the same way as Google is today, with domains such as docs.new, which automatically opens up a fresh Google Docs word processing document when typed into a browser address bar.

From January 14, all the way to July 14, Google wants to run a Limited Registration Period, which will require wannabe registrants to apply to Google directly for the right to register a name.

During that period, registrants will have to that they’re going to use their names in compliance with .new’s modus operandi. It’s Google’s hope that it can seed the space with enough third-party content for .new’s value proposition to become more widely known.

If you’re wanting to pick up a .new domain in general availability, it looks like you’ve got at least nine more months to wait.

Three big changes could be coming to .uk

Kevin Murphy, October 9, 2019, Domain Registries

Nominet wants to know what you thinking about three significant policy changes that could be implemented in the next year or so.

The .uk registry today published a consultation document covering two security-related changes and one related to expired domains.

First, Nominet wants to know if it should be allowed to preemptively block resolution on newly registered domains where it has “identified a high risk the domain will be used for phishing”.

It looks like more of a cosmetic policy change, given that the company is already blocking suspected phishing domains where the registrant fails to adequately verify their identity.

About 1,500 domains were blocked like this in the 12 months ending July 2019, Nominet says, on the basis of its Domain Watch program, which combines technical and manual oversight to identify phishy-looking names.

Second, Nominet want to know if it should display an standard informational web page when it blocks a domain on the basis of fraud, copyright infringement, and counterfeiting.

Currently, the company takes down tens of thousands of names every year on this basis, but the names are simply removed from the zone file and refuse to resolve.

Nominet’s friends in law enforcement reckon that allowing the the domains to instead resolve to a standard web page instead could help victims of fraudulent sites help with police investigations, and Nominet wants to know if you agree.

A side-effect of this would be that the names would remain in the zone, so we’d be able to see for the first time which names get suspended for fraud.

Third, Nominet wants to know whether it should start openly publishing drop-lists, the list of domains that have expired registrations and are about to become available.

This appears to be bad news for those registrars currently “excessively” pinging the registry to compile their own lists and get the jump on competitors when it comes to drop-catching valuable names for resale.

Nominet seems to want to see fewer dropped domains winding up in the hands of domainers, saying currently “not all dropping domains are registered and actively used by the new registrant, reducing the vibrancy of .UK domains”.

It’s proposing to give drop-lists just to registrars, or to publish them openly.

All three questions are open for comment until December 15.

Radix acquires another gTLD

Kevin Murphy, October 7, 2019, Domain Registries

Radix has added the 10th new gTLD to its portfolio with an acquisition last month, bringing its total TLD stable to 11.

The company has acquired .uno from Missouri-based Dot Latin LLC for an undisclosed amount.

.uno, which of course means “one” in Spanish, has been around for over five years but has struggled to grow.

It’s current ranked as the 131st largest new gTLD, with 16,271 domains in its zone file. It peaked at about 22,000 about three years ago.

That said, it appears to have rather strong renewals, at least by Radix standards, with no evidence of relying on discounts or throwaway one-year registrations for growth.

.uno names can currently be obtained for roughly $12 to $20 per year.

Radix said its expects to migrate the TLD off its current Neustar back-end onto long-time registry partner CentralNic by “early 2020”.

The company appears to be excited that its only the second three-letter TLD in its portfolio.

It already runs .fun, along with the likes of .website, .tech and .online. It also runs .pw, the repurposed ccTLD for Palau.

.uno was Dot Latin’s only gTLD, though affiliated entity Dot Registry LLC signed its ICANN registry agreement for .llp (for “Limited Liability Partnership”) in August. That TLD has yet to launch.

.whoswho survives!

Kevin Murphy, October 3, 2019, Domain Registries

The registry running the failing new gTLD .whoswho has managed to avoid having its contract terminated by ICANN.

According to an update on the ICANN web site, Who’s Who Registry came back into compliance with its obligations earlier this week, meaning it can continue operating.

It had been under a cloud of uncertainty since January, when ICANN Compliance sent off a breach notice saying the company was overdue with its $25,000-a-year fees.

Who’s Who originally had until a date in February to pay up, but this deadline has been extended repeatedly over the course of the year.

Registry CEO John McCabe had told ICANN last November that the fee is “onerous” and “the single largest item in .whoswho’s budget”.

ICANN later rejected his request for a fee reduction.

.whoswho, which seeks to replicate the once-popular biography compilation books of the same name, has fewer than 100 real registrations to its name, most of which appear to be defensive, despite being live for five years.

At about $70 a pop, that’s still not nearly enough to cover ICANN fees, never mind other operating costs.

It sold barely a dozen names in the first half of this year.

I thought it was a goner for sure.

But it looks like it’s been saved from the axe for now, so maybe there’s time to turn things around.

Nominet raises .uk prices

Kevin Murphy, October 1, 2019, Domain Registries

Nominet is to raise the price of a .uk domain name in January, adding a couple million quid to its top line.

The company’s annual registry fee will increase by 4%, from £3.75 to £3.90 ($4.77), on January 13 next year.

Nominet said the increase is to reflect “some of the increased costs of running the registry business since prices last changed in 2016.”

While it’s a modest £0.15 extra per name per year, at the current registration volume that works out to just shy of £2 million ($2.45 million) more revenue per annum.

Perhaps predicting a backlash from large-volume registrants, Nominet told registrars:

We appreciate that price rises are never popular, but even after this modest rise, .UK domains remain extremely competitively priced in the market and accessible to all.

If US dollars are your frame of reference, .uk names will still actually be cheaper following the price increase than they were following the 2016 price increase, due to exchange rate fluctuations.

The last price increase went into effect in March 2016. Before that, prices had been unchanged since 1999.

Mediocre .vote gTLD drops restrictions

Kevin Murphy, October 1, 2019, Domain Registries

The .vote and .voto gTLDs have had their registration restrictions removed in a bid to increase numbers.

Both domains were previously technically restricted to those who could show they had a legitimate connection to democratic proceedings, and were sometimes used by political campaigns.

But it appears those post-registration restrictions were lightly enforced, and now they’ve been dropped entirely.

Neither gTLD has been particularly successful — .vote has been wobbling around the 3,000-domain mark for a while, while .voto (the Spanish version) has about a tenth of that figure.

Both renew at retail for about $60 a year, but first-year regs can currently be obtained for about half that amount.

They’re both managed by Afilias.

The highest-profile .vote domain I’m aware of to date was used in the spectacularly successful Hollywood-backed campaign to keep Donald Trump out of the White House in 2016.