Four in 10 new gTLDs are shrinking

Forty percent of non-brand new gTLDs are shrinking, DI analysis shows.
According to numbers culled from registry reports, 172 of the 435 commercial gTLDs we looked at had fewer domains under management at the start of June than they did a year earlier.
On the bright side, that means the majority of them are still growing, but it’s still a pretty poor showing.
As you might expect, registries with the greatest exposure to the budget and/or Chinese markets were hardest hit over the period.
.wang, .red, .ren, .science and .party all saw DUM decline by six figures. Another 27 gTLDs saw declines of over 10,000 names.
Of the portfolio registries, Famous Four Media, Uniregistry and Afilias saw the steepest falls, each churning through hundreds of thousands of domains.
FFM strings including .science, .party and .date, which are regularly offered for under $0.50 and have terrible renewal rates, were among the biggest losers.
For Afilias, its .red, .blue and .pink combined saw volumes plummet by over 300,000. Its Korean-surname-themed .kim lost 90,000 names over the year.
Much of Uniregistry’s decline, I believe, is due to the expiration of thousands of domains that were essentially registry-owned.
Here’s a list of the top 40 biggest losers.
[table id=48 /]
At the opposite end of the table, the biggest gainers over the 12-month period were .xyz, .loan, .top, .online, .men, .tech, .kiwi, .club, .site and .bid.
Those 10 TLDs all saw volumes increase by over 100,000 names.
But that’s not necessarily hugely encouraging news, for various reasons.
We already know that .xyz is set to lose millions of names over its next couple of monthly registry reports.
One could guess that the peaks in Famous Four strings .bid, .loan and .men are likely to be matched by troughs before long.
.kiwi appears to be on the list due to its waiving the fees on about 200,000 domains, under a deal with a registrar last year.
.club recently said that it only expects to get 10% to 15% renewals on about 700,000 of its million total names.
Finally, .top is widely thought of as the TLD of choice for throwaway spam domains and has already lost a couple million names since June.
Here’s the top 30 gainers from my list:
[table id=49 /]
For the survey, I selected only new gTLDs from the 2012 round that had general availability dates in 2015 or earlier. I excluded any gTLD with Specifications 9 or 13, which act as a dot-brand flag, in their ICANN contract.
The 436 resulting TLDs include both wide-open, commercially available namespaces such as .link and .xyz, and the more restricted zones such as .bank and .law.

Domain growth flat in Q2

Growth in the volume of registered domain names was exactly the same in the second quarter as it was in the first.
That’s according to the latest Domain Name Industry Brief, published by Verisign late last week.
Q2 closed with 331.9 million registered names, up 1.3 million or 0.4% sequentially. The Q1 DNIB published three months ago also showed net growth of 1.3 million names.
That’s an increase of 6.7 million names, 2.1%, over the second quarter 2016, which compares unfavorably to the first quarter’s annual growth of 11.8 million names.
A slight majority of the 1.3 million bump seems to have come from .com and .net, which together grew from 143.6 million to 144.3 million names, roughly a 700,000 name or 0.4% sequential increase.
ccTLDs fared a little better, going to to 144.2 million names from 143.1 million in Q1. That’s a 1.1 million increase.
New gTLDs took the edge off the overall industry growth, shrinking from 25.4 million names in Q1 to 24.3 million in Q2.
That’s largely due to the expiration of millions of speculative .xyz registrations that were given away for free or nearly free in 2016.
As anticipated, .xyz fell off the top 10 list of all TLDs to be replaced by 17-year-old .info, which added an impressive 300,000 names to wind up in the #9 spot ahead of flat Netherlands ccTLD .nl.

XYZ slashes $10 million a year from premium stash

XYZ.com has slashed the asking price of a few thousand “premium” .xyz domain names, in some cases by many thousands of dollars.
Overall, it looks like the company has dropped prices by a total of $10.8 million.
At the top end of its reserved list, several single and double-character domains previously priced a $55,000 per year have been reduced to $13,000 per year.
At the lower end, domains previously priced at around $1,300 are now around $300.
Those are the recommended retail prices. Some registrars are offering them with a substantial mark-up.
The reductions affect 2,700 of the domains on XYZ’s premium list, which runs to about 3,075 names in total.
Whereas the previous hypothetical value of the full list was $15.3 million a year, it’s now at $4.4 million a year.
Of course, they’re not worth anything unless somebody is willing to pay the price, and the domains still seem to have end-user price tags on them.
Premium renewal fees have so far proved unpopular in the domain investing community due to the large carrying cost.
XYZ’s full list can be obtained here.

CentralNic extends XYZ deal until 2032

CentralNic and XYZ.com have extended their registry services pact for the next fifteen years, according to CentralNic.
Announcing its first-half 2017 financial results today, CentralNic said the back-end contract has been extended until 2032.
It’s an unusually long duration for a registry services contract, which are usually much more likely to run about five years.
It even lasts 10 years beyond the expiration of XYZ.com’s own ICANN contracts (though renewal of these is a near-certainty).
The deal covers all .xyz domains, as well as all of the other TLDs in XYZ.com’s portfolio. That currently includes the likes of .rent, .storage and .college.
CentralNic said it “will receive a fixed fee based on the volume of .xyz registrations and subscriptions managed” under the new deal.
In a statement to the markets, CEO Ben Crawford said the relationship “has been updated to normalise the Company’s revenues and profits going forward.”
I believe the previous contract contained a per-domain component, which exposed CentralNic’s revenue to .xyz’s erratic pricing-influenced growth trajectory.
.xyz’s zone file has shrunk by a whopping four million domains since this time last year, causing it to lose the crown of highest-volume new gTLD, due to it offering free or almost free domains that expired without renewing after a year.
However, CentralNic disclosed that the proportion of its own wholesale transaction volumes that were renewals (rather than adds and transfers, I assume) was 18% in the first half, up from 2% in the same 2016 period.
For the six months ended June 30, the company had overall revenue of £10.6 million ($13.9 million), up 18.5% year over year.
Its net loss after tax was £619,000 ($810,000), down from £1.3 million. At the EBITDA level, profit was £1.4 million ($1.8 million) compared to $900,000 in H1 2016.
While I still stubbornly think of CentralNic as primarily a registry play, in fact the company now gets about three quarters of its revenue today from its retail registrar division, which contributed just shy of £8 million to the total in H1.
Instra, the Australian registrar it acquired at the end of 2015, contributed £5.83 million.
The wholesale division, registry back-end services — contributed £1.82 million to revenue and £450,000 to EBITDA in the half.
That’s despite CentralNic being the back-end for six of the top 20 new gTLDs by volume — .website, .space, .tech, .site, .online, and .xyz
If we tally up the number of domains in only those six TLDs, we get to about 4.2 million, per their zone files.
The company’s third reporting unit, Enterprise, contributed £800,000 ($1 million) in the half, of which £360,000 ($471,000) came from premium domain sales.

Google shifts 400,000 .site domains

Google has given away what is believed to be roughly 400,000 subdomains in Radix’s .site gTLD as part of a small business web site service.
Since its launch a couple of months ago, the Google My Business web site builder offering has been offering small businesses a free one-page site with a free third-level domain under business.site.
Google My Business also offers users the ability to upgrade to a paid-for second-level domain via its Google Domains in-house registrar.
Google the search engine indexes 403,000 business.site pages currently. Because each subdomain is limited to a single page, it is possible that the number of subdomains is not too far behind that number, Radix believes.
This means that business.site is likely almost as large as the .site gTLD itself, which currently has about 450,000 names in its zone file.
Given the rapid growth rate, it seems likely the subdomain will overtake the TLD in a matter of weeks.
According to Radix, business.site was purchased off of its registry reserved premium list. The sale price has not been disclosed.
It’s good publicity for the TLD, and merely the latest endorsement by Google of the new gTLD concept.
As well as being the registry for many new gTLDs, Google parent Alphabet uses a .xyz domain and its registrar uses a .google domain.

Domain growth slows a lot in Q1

The growth of the domain name industry slowed in the first quarter, numbers published today by Verisign reveal.
According to its latest Domain Name Industry Brief (pdf), the domain universe grew to 330.6 million in Q1.
That’s an increase of 1.3 million names on Q4 2016, a 0.4% sequential increase, and 11.8 million names, 3.7% growth, compared to Q1 2016.
In the Q4 DNIB, Verisign reported industry growth of 0.7% and 6.8% respectively.
The only change on the list of the top 10 TLDs was that .nl and .xyz switched places (.xyz is now in 10th place, with 5.6 million names, but this rank will not last long).
ccTLDs in general did not match the growth of the overall market. There were approximately 143.1 million ccTLD domains at the end of March, up 0.3% sequentially and 1.7% year over year, both substantially smaller numbers than reported in Q4.
The free ccTLD .tk, which has been responsible for huge swings in recent reports, is reported to have declined by about 100,000 names to 18.6 million.
Excluding .tk, the growth rate of ccTLDs was better — 0.5% sequentially and 3.9% compared to the year-ago quarter.
Verisign’s data is largely based on zone files for gTLDs and independent researcher ZookNic for ccTLDs.

Junk drop cuts .xyz in half, .top claims volume crown

The .xyz gTLD has seen its zone file halve in size, as millions of free and cheap domains were not renewed.
The former volume leader among new gTLDs started this month with a tad over 5.2 million domains in its zone.
But its July 17 zone contained 2.5 million, much less than half as many, DI analysis shows.
The precipitous decline means that Chinese-run gTLD .top, increasingly notorious as a go-to TLD for spammers, is now literally at the top of the league table, when you measure new gTLDs by zone file volume, with 2.6 million names.
The primary reason for .xyz losing so many names is of course the expiration of most of the domains that were sold for just $0.01 — or given away for free — in the first few days of June 2016, and the aggressive promotional pricing on offer for the remainder of that month.
On May 30, 2016, there were just under 2.8 million names in the .xyz zone. By July 1, 2016, that number had topped 6.2 million, an increase of 3.4 million over a single month.
That was .xyz’s peak. The zone has been in gradual decline ever since.
Domains generally take 45 days to drop, so it’s entirely possible XYZ.com will see further losses over the next month or so.
There’s nothing unusual about seeing a so-called “junk drop” a year after a TLD launches or runs a free-domains promotion. It’s been well-understood for over a decade and has been anticipated for .xyz for over a year.
But compounding its problems, the .xyz registry appears to still be banned in China, where a substantial portion of its former customer base is located.
The company disclosed over two months ago that it had a “temporary” problem that had seen its license to sell domains via Chinese registrars suspended.
The ban was related to XYZ falling out with its original “real name verification” provider, ZDNS, which was tasked with verifying the identities of Chinese registrants per local government regulations.
I’ve never been able to confirm with either party the cause of this split, but everyone else involved in the Chinese market I’ve asked has told me it related to a dispute over money.
Regardless, two months later the major Chinese registrars I checked today still appear to not be carrying .xyz names.
XYZ has meanwhile signed up with alternative Chinese RNV provider Tele-info, and just three days ago submitted the necessary paperwork (pdf) with ICANN to have the move approved as a registry service under its contract.
In that request, XYZ said the new RNV service “will allow XYZ to reenter certain domain name markets”, suggesting that it has not yet regained Chinese government approval to operate there.

.xyz sets price for numeric domains at $0.65

XYZ.com has announced that it will charge just $0.65 wholesale for over a billion numeric domain names in .xyz.
The revelation came as part of a confusing launch of what the registry calls its “1.111B Class” domains.
That’s because the pricing affects all 1.111 billion numerical domains of six, seven, eight and nine digits in .xyz.
These will now all register and renew for $0.65 or a recommended $0.99 retail.
That’s the same price that regular alphanumeric .xyz domains are selling at at many registrars, but the pricing for the 1.111B names is said to be fixed forever; it’s not a temporary promotion.
The announcement was themed on a take on the 16-year-old “All Your Base” meme and a white paper (pdf) written in the color scheme and typeface of a 1990s Unix terminal.
There’s a whole lot of fluff involved, but the gist of it appears to be that XYZ thinks these domains have value, when registered in bulk, to do stuff like address “Internet of Things” devices. The white paper states:

With the emergence of the Internet of Things (IoT), the 1.111B Class serves as a platform to easily and uniquely identify different devices, ranging from laptops to smart thermostats. In fact, registrants can even secure tens, hundreds, thousands to millions of domains in sequential order to create a block. These blocks can match device serial numbers or vehicle VIN numbers, then be used as portals for consumers to connect with their products, and for their products to receive updates from manufacturers.

There are of course far cheaper ways to go about this, such as using subdomains of an existing branded domain (which would have the added benefit of semantic value).
XYZ also talks in vague terms about these cheap domains being similar to Bitcoin, with reference to how Chinese domainers trade worthless domains as a kind of virtual currency.
I must confess I don’t get this idea at all. In my mind, owning a domain that has no possibility of an end-user buyer is more of a liability that an asset.
Still, it’s interesting to see a registry attempting to market domains for non-traditional purposes, so I’m curious to see how it plays out.

Country names to finally be released in new gTLDs

It looks like hundreds of domain names matching the names of countries are to finally get released from ICANN limbo.
The ICANN board last week passed a resolution calling for the organization to clear a backlog of over 60 registry requests to start selling or using country and territory names in their gTLDs.
Some of the requests date back to 2014. They’ve all been stuck in red tape while ICANN tried to make sure members of the Governmental Advisory Committee was cool with the names being released.
The result of these three years of pondering is scrappy, but will actually allow some names to hit the market this year.
The new resolution calls for ICANN to “take all steps necessary to grant ICANN approvals for the release of country and territory names at the second-level”, but only “to the extent the relevant government has indicated its approval”.
And that’s the catch.
Some governments, such as the US and UK, don’t care who registers matching names. Dozens of others want to vet each registry request on a case-by-case basis.
The wishes of each government are record in a GAC database.
The only territories to so far give a blanket waiver over their names are: Denmark, Finland, Ireland, the Netherlands, Norway, Sweden, the UK, the USA, Guernsey and Pitcairn.
Almost 70 other countries have said they need to be told when a registry wants to sell a domain matching their name. Ten others give carte blanche to closed dot-brands, but require notification in the case of open gTLDs.
The majority of countries in the world have yet to officially express a preference one way or the other.
Of the roughly 60 new gTLD registries to request country name releases over the last few years, the vast majority are dot-brands. The number of open gTLDs with such requests appears to be in the single figures, and the only ones with mass-market appeal appear to be .xyz and .global.

XYZ acquires .storage, its 10th gTLD

XYZ.com said today that it has acquired the half-launched new gTLD .storage from its original owner.
The terms of the deal were not disclosed, but CEO Daniel Negari said in a blog post that it has been funded using some of the “excess of cash flow” from sales of .xyz domains.
The original .storage registry was Extra Space Storage, which rents out physical storage units in the US.
It started its protracted launch period a little over a year ago but had not planned to go to general availability until July this year.
Having apparently passed through its sunrise period and a special landrush for the storage industry, which ended in January, it has fewer than 800 domains in its zone file.
It looks like XYZ will be essentially relaunching the gTLD from scratch, with a new sunrise period penciled in for November and an early access period and GA slated for December.
Pre-launch pricing is around the $80 mark at the few registrars I checked today, and it looks like that will remain under the new management.
That’s despite XYZ talking today about .storage as a “premium” vertically-focused TLD along the lines of its $3,000 .cars or $750 .theatre.
The company said that it will not hold back reserved names at higher, premium pricing. Even nice-looking domains such as cloud.storage will be available at the base fee, it said.
The new acquisition becomes the 10th that XYZ has a hand in running, if you count the three car-related gTLDs it manages in a joint venture with Uniregistry. The others are .security, .rent, .protection, .theatre, and .college.