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Verisign adds 750,000 .com names instantly with reporting change

Kevin Murphy, March 23, 2015, Domain Registries

Verisign has boosted its reportable .com domain count by almost 750,000 by starting to count expired and suspended names.

The change in methodology, which is a by-product of ICANN’s much more stringent Whois accuracy regime, happened on Friday afternoon.

Before the change, the company reported on its web site that there were 116,788,107 domains in the .com zone file, with another 167,788 names that were registered but not configured.

That’s a total of 116,955,895 domains.

But just a few hours later, the same web page said .com had a total of 117,704,800 names in its “Domain Name Base”.

That’s a leap of 748,905 pretty much instantly; the number of names in the zone file did not move.

.net jumped 111,110 names to 15,143,356.

The reason for the sudden spikes is that Verisign is now including two types of domain in its count that it did not previously. The web page states:

Beginning with the first quarter, 2015, the domain name base on this website and in subsequent filings found in the Investor Relations site includes domains that are in a client or server hold status.

I suspect that the bulk of the 750,000 newly reported names are on clientHold status, which I believe is used much more often than serverHold.

The clientHold EPP code is often applied by registrars to domains that have expired.

However, registrars signed up to the year-old 2013 Registrar Accreditation Agreement are obliged by ICANN to place domains on clientHold status if registrants fail to respond within 15 days to a Whois verification email.

The 2013 RAA reads (my emphasis):

Upon the occurrence of a Registered Name Holder’s willful provision of inaccurate or unreliable WHOIS information, its willful failure promptly to update information provided to Registrar, or its failure to respond for over fifteen (15) calendar days to inquiries by Registrar concerning the accuracy of contact details associated with the Registered Name Holder’s registration, Registrar shall either terminate or suspend the Registered Name Holder’s Registered Name or place such registration on clientHold and clientTransferProhibited, until such time as Registrar has validated the information provided by the Registered Name Holder.

Last June, registrars claimed that the new policy — which came after pressure from law enforcement — had resulted in over 800,000 domains being suspended.

It’s an ongoing point of contention between ICANN, its registrars, and cops.

Verisign changing its reporting methodology may well be a reaction to this increase in the number of clientHold domains.

While its top-line figure has taken a sharp one-off boost, it will still permit daily apples-to-apples comparisons on an ongoing basis.

UPDATE:

My assumption about the link to the 2013 RAA was correct.

Verisign CFO George Kilguss told analysts on February 5.

Over the last several years, the average amount of names in the on-hold status category has been approximately 400,000 names and the net change year-over-year has been very small.

While still immaterial, during 2014, we saw an increase in the amount of names registrars have placed on hold status, which appears to be a result of these registrars complying with the new mandated compliance mechanisms in ICANN’s 2013 Registrar Accreditation Agreement or RAA.

In 2014, we saw an increase in domain names placed on hold status from roughly 394,000 names at the end of 2013 to about 870,000 at the end of 2014.

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All eyes on Donuts as first new gTLD renewal figures roll in

Kevin Murphy, March 23, 2015, Domain Registries

Donuts is about to give the world the clearest picture yet of the ongoing demand for new gTLD domain names.

The company has taken the unprecedented decision to disclose its renewal figures on a pretty much live basis.

COO Richard Tindal has been blogging renewal stats for .bike, .clothing, .guru, .ventures, .holdings, .plumbing and .singles for the last few days.

Those were the first seven of its gTLDs to hit general availability.

To Saturday, the renewal status of 6,352 names in these gTLDs was known and the renewal rate was 85.3%.

However, that rate is boosted by the relatively high proportion of the names that were registered during sunrise periods.

Donuts said that “two thirds” of the 6,352 reported domains were registered after sunrise.

That doesn’t make a whole lot of sense to me, given that Donuts has previously put the total number of sunrise regs across the seven TLDs at just 1,404, which would work out at about 22%, not 33%.

On Friday, the company had said that the status of 4,534 names was known and the renewal rate was 91.6%.

If you deduct the Friday numbers from the Saturday numbers, you get to 1,265 renewals and 553 drops, a renewal rate of almost 69.6% for that particular day.

That number, which is a few percentage points off what a gTLD such as .com regularly reports, could of course fluctuate.

The full-year renewal rate, which would factor out much of the domainer activity, of course won’t be known for another year.

Donuts said it expects its renewal rate to drop to the mid-70s in its next daily report, expected today, which will cover an additional 22,910 domains.

The company’s decision to blog its numbers comes a day or two after we reported that ICANN is only budgeting for renewals of 50%.

The 14.6% of names not renewed works out to about 933 domains.

“We believe most of those names will be re-registered by another party within the next 35 days,” Tindal wrote.

As they were all registered in the early days of GA, one might expect them to be of a reasonably high quality.

While GA began at the end of January 2014, renewal rates are not known until the Auto-Renew Grace Period, which can be as long as 45 days, has expired.

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.tk registrar gets ICANN breach notice

Kevin Murphy, March 19, 2015, Domain Registrars

OpenTLD, the registrar owned by .tk registry Freenon, has received an odd contract-breach notice from ICANN.

The company apparently forgot to send ICANN a Compliance Certificate for 2014, despite repeated pestering by ICANN staff.

It’s the first time I’ve seen ICANN issue a breach notice (pdf) for this reason.

A Compliance Certificate, judging by the 2013 Registrar Accreditation Agreement, seems to be a simple form letter that the CEO must fill in, sign and submit once a year.

Coming back into compliance would be, one imagines, five minutes’ work.

As well as being an ICANN-accredited registrar, OpenTLD is part of Freenom. That’s the registry that repurposes under-used ccTLDs with a “freemium” model that allows free registrations.

Its flagship, .tk, is the biggest ccTLD in world, with over 30 million active names.

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ICANN slashes new gTLD revenues by 57%, forecasts renewals at 25% to 50%

Kevin Murphy, March 19, 2015, Domain Registries

ICANN has dramatically reduced the amount of revenue it expects to see from new gTLDs in its fiscal 2015.

According to a draft 2016 budget published this morning, the organization now reckons it will get just $300,000 from new gTLD registry transaction fees in the year ending June 30, 2015.

That’s down 75% from the $1.2 million predicted by its FY 2015 budget, which was approved in December.

Transaction fees are paid on new registrations, transfers and renewals, but only by gTLDs with over 50,000 billable transactions per year.

Today, only 14 of the 522 delegated new gTLDs have added more than 50,000 names. ICANN says that only 17 registries are currently paying transaction fees.

It’s not only the transaction fees where ICANN has scaled back its expectations, however.

The organization also expects its fixed new gTLD registry fees — the $6,250 each registry must pay per quarter regardless of volume — to come in way below targets.

The new budget anticipates $12.7 million from fixed registry fees in FY15, down 24% from the $16.7 million in its adopted FY15 budget.

This is presumably due to larger than expected numbers of would-be registries either withdrawing or dragging their feet in the path to delegation.

Registrar transaction fees are now anticipated at $1.1 million, compared to $2 million and $3.2 million predicted by the adopted and draft FY15 budgets respectively.

Taking all three revenue sources together, ICANN now expects new gTLDs to contribute just $14.1 million to its fiscal 2015 revenue, down 29% from the $19.8 million forecast in its adopted FY15 budget.

That’s down 57% from the $32.7 million in the original draft budget for the period.

The current budget assumes 15 million new gTLD registrations in the 12-month period, revised down from the 33 million domains predicted in its draft FY15 budget a year ago.

With just a few months left until the end of the fiscal year, there are currently fewer than 4.5 million domains in published new gTLD zone files.

ICANN plainly no longer expects new gTLDs to get anywhere close to 15 million domains.

Renewals expected to be weak, weak, weak

The organization is taking a conservative view about renewals for 2016.

The 2016 budget expects renewals at just 50% for regular gTLDs and 25% for registries — presumably ICANN has .xyz in mind — that gave away domains for free at launch.

That 50% is both ICANN’s “best” and “high” estimate. Its “low” estimate is 35% for non-free domains.

Obviously, 50% is a very low renewal number for any registry (70%+ is the norm). Even شبكة. (.shabaka) told us recently that 55% of its registrants are renewing before their domains expire.

Conversely, 25% may be a very optimistic number for free domains (when Afilias gave away free .info names a decade ago, almost all of them dropped rather than being renewed).

For fiscal 2016, which begins July 1, 2015, ICANN expects new gTLD revenue to be $24.1 million — about a quarter off its original plan for 2015.

That breaks down as $19.9 million from registry fixed fees, $2 million from registry transaction fees, and $2.3 million from registrar transaction fees.

ICANN said it is is assuming that it will start the year with 602 registries and end it with 945.

The proposed FY16 budget, now open for comment, can be found here.

For comparison purposes, the adopted FY15 budget is here (pdf) and the draft FY15 budget is here (pdf).

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Could Verisign lose $3.3m .gov deal?

Kevin Murphy, March 17, 2015, Domain Registries

The US government has put its feelers out for information about a possible successor to Verisign as manager of the .gov TLD.

A formal Request For Information — potentially a precursor to a Request For Proposals — was was issued by the General Services Administration on March 9.

The GSA, which is the sponsor of the .gov gTLD, seems to be looking for information about all aspects of running a registry back-end and the secure dotgov.gov registrar front-end.

Those functions have been carried out by Verisign since it took them over from the GSA itself in December 2010.

Its five-year contract expires in September this year.

Because it’s restricted to US government entities, .gov is not a large gTLD — the RFI says it has about 5,000 domains and grows at about 5% a year — but it does carry a certain prestige.

It also carries a not inconsiderable fee. According to the September 2010 award page, the deal is worth $3,325,000 to Verisign.

It’s quite possible that the RFI is just a case of the US government going through the necessary motions prescribed by its procurement policies; Verisign may well be a shoo-in.

But the company’s record with .gov isn’t as great as its record with .com and .net.

In August 2013, Verisign screwed up a DNSSEC key rollover in the .gov zone, causing resolution failures on the small number of networks that rigorously enforce DNSSEC.

The deadline for RFI responses is March 23.

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