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Register.com sold at a $65 million loss

Register.com has been acquired by web hosting company Web.com for $135 million, substantially less than the $200 million Vector Capital paid for it five years ago.

Web.com said the acquisition will help it access new small business customers for lead generation, to cross-sell its existing products.

The company’s customer base will increase by over 400% to more than one million customers, Web.com said. The combined firm will have annual revenue of $180 million.

Register.com was one of the first five ICANN-accredited registrars. It failed as a public company, and after years of financial wrangling was finally taken private by Vector in 2005.

Vector specializes in buying up troubled companies and turning them around, but it doesn’t appear to have increased the value of this particular asset over the last five years.

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Will ICANN punt .xxx in Brussels?

Is ICANN set to delay approval of the proposed .xxx top-level domain – again – in Brussels?

That’s my reading of ICANN’s latest document concerning ICM Registry’s long-running and controversial battle for a porn-only TLD.

This week, ICANN submitted its summary of the public comment period that ran to May 10. It’s a fair bit shorter than the one Kieren McCarthy compiled for ICM last month.

As usual, it’s written in a fairly neutral tone. But, if you’re feeling conspiratorial, the mask does slip on occasion, perhaps giving a sense of where the .xxx application could head next.

The ICANN summary occasionally breaks from reporting what a commenter actually said in order to highlight a potential problem they did not address.

Example (my emphasis):

Only two commenters directly addressed the question of further interaction with the Governmental Advisory Committee (GAC) on the .XXX sTLD Application. Both of those commenters were against seeking any further input from the GAC outside of any public comment period. Neither of these commenters – nor any other – addressed the potential violation of the ICANN Bylaws that could result from the Board’s failure to properly consider the advice of the GAC

This suggests, to me, that the ICANN board will be receiving advice to the effect that further GAC input needs to be forthcoming before it can move forward with .xxx.

If this is the case, the GAC might have to produce some advice before next Friday’s board meeting if ICM has any hope of getting back around the negotiating table prior to Cartagena in December.

That’s not the only reason to believe ICANN may punt .xxx again, however. Elsewhere in the report, we read (my emphasis again):

For those in favor of proceeding with the .XXX sTLD Application, many created an alternative option – that ICM and ICANN should proceed to a contract right away. There was substantial discussion on this point in the ICM submissions. Few commenters addressed the technical realities identified within the Process Report ‐ that prompt execution of the agreement negotiated in 2007 is not feasible.

The Process Report referenced says that it is not possible to go straight into contract talks because ICM first applied for .xxx more than six years ago.

This has been a bone of contention. ICM points to .post, which was applied for at the same time as .xxx and only approved late last year, as proof that the passage of time should be no barrier.

But ICANN president Rod Beckstrom doesn’t buy that comparison. He wrote to ICM (pdf) at the end of March noting that .post was backed by the International Postal Union, whereas .xxx is “sponsored” by IFFOR, an organization created by ICM purely to act as its sponsor.

In that letter, Beckstrom talks about due diligence to make sure ICM and IFFOR still satisfy financial and technical criteria, and a review of whether .xxx “can still satisfy the requisite sponsorship criteria”.

I’ll admit that I’m breaking out the crystal ball a bit here, and I’ve been wrong before, but I don’t think it’s looking great for ICM in Brussels.

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ICANN creates DNSSEC root keys

Kevin Murphy, June 17, 2010, Domain Tech

ICANN took the penultimate step towards adding DNSSEC to the root of the domain name system, during in a lengthy ceremony in Virginia yesterday.

The move means we’re still on track to have the DNSSEC “trust anchor” go live in the root on July 15, which will make end-to-end validation of DNS answers feasible for the first time.

DNSSEC is an extension to the DNS protocol that enables resolvers to validate that the DNS answers they receive come from the true owner of the domain.

Yesterday, ICANN generated the Key Signing Key for the root zone. That’s one of two keys required when adding DNSSEC to a zone.

The KSK is used to sign the DNSKey record, the public half of a key pair used to validate DNS responses. It has a longer expiration date than the Zone Signing Key used to sign other records in the zone, so its security is more important.

The videotaped ceremony, held at a facility in Culpeper, Virginia, was expected to take six hours, due to a lengthy check-list of precautions designed to instil confidence in the security of the KSK.

ICANN said:

During the ceremony, participants were present within a secure facility and witnessed the preparations required to ensure that the so-called key-signing-key (KSK) was not only generated correctly, but that almost every aspect of the equipment, software and procedures associated with its generation were also verified to be correct and trustworthy.

Ten hand-picked independent observers were present to bear witness.

ICANN expects to perform the ceremony four times a year. The second will be held at a backup facility in California next month.

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Kredit.com sells for a fraction of Kredit.de

Kevin Murphy, June 15, 2010, Domain Sales

Kredit.com, which means “credit.com” in German, has been sold via Sedo for a fraction of the price that Kredit.de sold for about 18 months ago.

Sedo reported today that the domain changed hands recently for €220,000, which works out to $271,000 at today’s exchange rates.

For comparison, the German ccTLD equivalent, kredit.de, went for €892,500 in December 2008, also via Sedo. At the time, that amount translated to $1.25 million.

A generic ccTLD selling for roughly 5x the .com is a fairly uncommon occurrence, perhaps demonstrating how strong the .de namespace is locally. I can’t imagine such a wide discrepancy in valuations between a generic .com and .co.uk.

Kredit.com was originally registered in 1996. It’s currently parked, with an Irish address listed in the Whois.

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Microsoft launches Kinect without Kinect.com

Kevin Murphy, June 14, 2010, Domain Sales

Microsoft has revealed that its long-awaited gaming platform previously known as Project Natal will be officially known as “Kinect”.

While the company has a trademark on the word, it does not currently own the domain name kinect.com.

It’s registered and redirecting to CAHG, which appears to be an advertising agency specialising in the pharmaceutical industry.

Kinect is widely recognized as a global leader in interactive marketing and promotion and serves as the Interactive Agency of Record for many market-leading brands in the US, Europe, Asia, South Africa, and the Middle East.

I expect lucky CAHG could shortly find itself on the receiving end of an offer it cannot refuse.

There is some precedent: four years ago, when Nintendo launched the Wii, the domain wii.com belonged to Weyerhaeuser, a forestry products company.

It took a few months for the name to change hands, for an undisclosed sum.

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