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Rightside sells eNom to Tucows for $83.5m

Kevin Murphy, January 23, 2017, Domain Registrars

Tucows is to become “the second largest registrar in the world” by acquiring eNom from Rightside, paying $83.5 million.

The deal will give Tucows another 14.5 million domains under management and 28,000 resellers, giving it a total of 29 million DUM and 40,000 resellers.

That DUM number, which appears to include ccTLDs, makes Tucows the undisputed volume leader in the reseller world and the second-largest registrar overall.

GoDaddy, the DUM leader, had about 55 million domains just in gTLDs at the last count.

Tucows CEO Elliot Noss told analysts that the deal, along with the April 2016 acquisition of Melbourne IT’s reseller business, were “individual opportunistic transactions”.

He said that Tucows will take its time integrating the two companies, but expects to realize cost savings (presumably read: job losses as duplicate administrative positions are eliminated) over 24 months.

The reseller APIs will not change, and Tucows will not migrate names over to its own existing ICANN accreditations. This could help with reseller retention.

For Rightside, the company said the spin-off will allow it to focus on vertical integration between its gTLD registry business and its consumer-facing registrar, Name.com.

Rightside had come in for a certain amount of high-profile investor criticism for its dogged focus on new gTLDs at the expense of its eNom and Name.com businesses.

Activist investor J Carlo Cannell, supported by fellow investor and Uniregistry CEO Frank Schilling, a year ago accused Rightside of putting too much emphasis on “garbage” new gTLDs instead of its more profitable registrar businesses.

Since then, Rightside has rebuffed separate offers for some or all of its gTLDs by rivals Donuts and XYZ.com.

Last June, it also announced plans to modernize eNom, which Cannell and others had accused of looking stale compared to its competitors.

NCC sells Open Registry at huge discount

Kevin Murphy, January 6, 2017, Domain Registries

NCC Group has followed through on its promise to divest parts of its domain business, selling the Open Registry collection of companies at a huge discount to the original purchase price.

KeyDrive and a mysterious entity called Terrain.com SA have together acquired the companies for €3.75 million ($3.97 million).

That’s compared to the minimum of £7.9 million ($12 million) NCC originally paid just two years ago.

NCC said in a statement that the sold companies are:

  • Open Registry SA, a registry back-end provider with a handful of new gTLD clients.
  • ClearingHouse for Intellectual Property SA, aka CHIP, which provides software and billing support for the Trademark Clearinghouse.
  • Nexperteam CVBA, a tiny registrar.
  • Sensirius CVBA, the original Open Registry company, a new gTLD consultancy.

Missing from that list is Artemis, the new gTLD registry for .trust, which NCC separately acquired from Deutsche Post for an undisclosed sum in February 2014.

NCC is also keeping hold of its data escrow business, which is widely used by gTLD registries to comply with ICANN rules.

It’s not clear how the sold companies are being divided up between the two buyers.

KeyDrive is the Luxembourg-based holding company for the registrars Key-Systems and Moniker and other domain firms.

Terrain.com appears to belong to EuroDNS chair Xavier Buck, who was chair of Open Registry until NCC bought it, but the domain itself doesn’t seem to resolve right now.

NCC said that €2 million will be paid up front and €1.75 million will be deferred for 18 months.

Neustar agrees to go private in $2.9 billion deal

Kevin Murphy, December 16, 2016, Domain Registries

Struggling infrastructure services firm and domain registry Neustar is set to go private in a $2.9 billion deal.

The company, best known for .biz, .co and .us, has agreed to be bought out by a group led by Golden Gate Capital.

The $33.50-per-share offer, announced on Wednesday and which Neustar’s board has approved, is a 45% premium over the closing price the day before Golden Gate first disclosed it had a stake.

That’s still hell and gone from the roughly $45 the shares were trading for a few years ago, before the company first raised concerns that its lucrative number portability deal with the US government was on the ropes.

Since it became apparent that the numbering contract, which accounts for about half of Neustar’s revenue, was at risk, the company has attempted to focus its efforts on marketing services, security and domains.

That effort included the $87 million acquisition of registry rival Bombora (owner of ARI and AusRegistry) last year.

Earlier this year, the company announced its intention to split into two, basically spinning off all of its businesses not exposed to the US government contract.

It’s not entirely clear whether that plan will be followed through, but Neustar can no doubt be expected to go through some significant restructuring under new ownership. Golden Gate et al are not altruists, after all.

Neustar has 30 days to consider better offers from other white knights, under the terms of the deal.

If ultimately given the final rubber stamp, the deal may still not close until the third quarter of 2017, Neustar said.

Donuts acquires stagnant .irish TLD

Kevin Murphy, December 16, 2016, Domain Registries

Donuts has acquired the new gTLD .irish, which is struggling to gain volume after about 18 months on the market.

The gTLD was applied for and operated by Dot-Irish LLC, a US company founded by Irish and Northern Irish entrepreneurs.

Since going to general availability in June last year, it managed to grow its zone file to a peak of about 2,300 names in the first year.

That’s since dropped off to about 2,000 names.

Even self-consciously Irish registrar Blacknight has only managed to shift fewer than 500 names.

These numbers are disappointing any way you look at them, with the original gTLD application talking about an addressable market of 6 million Irish citizens and 80 million more in the Irish diaspora.

Registrar support does not seem to have been the issue. Registrars with reach, including Tucows, Name.com, Host Europe Group and Go Daddy all sell the names.

Pricing may be a factor. While Blacknight promotes .irish prominently for about $10 a year, elsewhere prices can range from $40 to $50.

The terms of the acquisition, which Donuts said closed last month, have not been disclosed.

Donuts said it will migrate .irish to its own infrastructure March 1, 2017. All policies and protection mechanisms that apply to the rest of the 198-strong Donuts stables will be applied to .irish, the company said.

GoDaddy will pay $1.79 billion for HEG in major Euro expansion

Kevin Murphy, December 7, 2016, Domain Registrars

GoDaddy is to substantially increase the size of its European operation with the $1.79 billion acquisition of Host Europe Group.

The market-leading registrar confirmed yesterday earlier reports that it was on track to buy HEG, which counts several big-name British and German registrars among its brands.

The deal is worth €1.69 billion ($1.79 billion), which breaks down to €605 million to HEG shareholders and €1.08 billion in debt. It’s expected to close in the second quarter next year.

HEG’s domain brands include 123Reg and DomainMonster in the UK and DomainFactory in Germany.

The company says it has 1.7 million customers and manages over seven million domains.

But the acquisition is more concerned with HEG’s higher-margin small business hosting business, where the company has nine data centers in Europe and the US.

GoDaddy said in a press release:

Combining GoDaddy’s global technology platform with HEG’s footprint in Europe will enable the rapid deployment of a broader range of products to customers and allow for better scale of product development and go-to-market investments across both companies.

One part of the HEG business, the $92 million-a-year PlusServer, is likely to be sold off, however.

GoDaddy said that unit “serves larger, more mature companies that require a dedicated field sales force and account management”, which is not GoDaddy’s core strength.

The deal means that GoDaddy will become the owner of the annual NamesCon conference, which HEG picked up in August for an undisclosed amount.

The acquisition is unlikely to have closed before this coming January’s NamesCon, so there’s unlikely to be many obvious changes to the 2017 event.

GoDaddy said the acquisition is being financed by debt.

HEG’s current owner is private equity firm Cinven, which paid $545 million in 2013.

Oracle buys Dyn just weeks after huge attack

Kevin Murphy, November 21, 2016, Domain Services

Oracle has signed a deal to buy DNS services provider Dyn for an undisclosed amount probably in the nine-figure range.

The software giant said it plans to integrate Dyn’s services into its existing cloud computing platform. For the moment, existing Dyn customers are unaffected.

Dyn provides distributed DNS resolution services mainly to the enterprise market, where it has about 3,500 customers.

But it also provides redundant DNS to some TLD registries, notably Uniregistry.

Knowing how ruthlessly opportunistic Oracle can be when it comes to M&A, I have to wonder how much impact the recent denial of service attack against Dyn had on the timing of the deal being signed.

Dyn customers including Twitter and Netflix found themselves inaccessible for millions of North American internet users a couple of weeks ago.

Customers that may have been reconsidering their DNS options following the downtime may feel more reassured now that Dyn is about to become part of a much larger company.

While the acquisition price was not disclosed, it’s certainly going to be in the hundreds of millions.

Just six months ago, Dyn received $50 million in venture capital, following on from a $38 million round in 2012.

Customers revolt as GoDaddy buys WordPress tools outfit

Kevin Murphy, September 7, 2016, Domain Registrars

GoDaddy has acquired ManageWP, a provider of software for managing large numbers of WordPress sites, leading to hundreds of complaints from customers.

The two companies announced yesterday that the deal will see GoDaddy integrate ManageWP into its existing suite of WordPress services.

ManageWP said pricing will be unaffected by the move, and that its service will continue to be available to customers using other hosting providers.

Despite these assurances, a few hundred ManageWP customers have over the last 24 hours expressed their dismay in comments on the company’s site.

“This is like my very best friend announcing they’re marrying the arsehole in the office,” wrote one commenter.

ManageWP customers are generally web developers who manage WordPress sites for multiple clients.

The service gives them the ability, for free, to manage these sites from a single console, rather than having to log in to each one individually.

For an extra couple of bucks per site per month, features such as daily backups and white-label client reports are available.

ManageWP said its product development roadmap will remain unchanged, and that GoDaddy may offer some currently premium features to its hosting customers for free.

About 8% of ManageWP sites run on GoDaddy, the company said in a blog post.

Despite the positive spin, a great many customers appear to be deeply unhappy that the six-year-old company is joining the Arizona behemoth.

At time of writing, there are already over 300 comments on the ManageWP post announcing the deal, almost all negative.

The bulk of the comments center on GoDaddy’s allegedly poor customer support and its reputation for constantly trying to up-sell products and services.

Here’s a small sample of comments:

I cancelled my account immediately upon reading this news.

I have never dealt with a worse company in my professional life than GoDaddy, and will never do so again. One of my requirements for taking on a new client is moving them off GoDaddy completely.

My main concern from a business perspective is that you are giving away premium features free to GoDaddy hosting customers. That is a direct conflict with the people that offer ManageWP as a service to their clients. The services we provide now seem like they are worth less to our clients who host at GoDaddy.

Bummed about this. The minute I see an up-sell notification slammed in my face trying to get me to join the GoDaddy hosting plan, I’m outta here.

Some of the comments appear to be rooted in experiences during the Bob Parsons era at GoDaddy, which came to an end over five years ago.

Commenters cited “sexist” advertising (largely a thing of the past under current CEO Blake Irving), support for the controversial SOPA legislation (spearheaded by a long-gone general counsel) and that time Parsons shot an elephant.

Many commenters said they will stick around post-acquisition, such is the goodwill ManageWP has earned.

Several ManageWP employees engaged directly with their customers comments. In one response, head of growth Nemanja Aleksic wrote:

the feedback here is something that GoDaddy will definitely need to consider. I’ve been asked by several people why I don’t lock the comments or moderate heavily. This is why. Every single bad and good comment is a ManageWP user whose livelihood could be affected by the acquisition. And every single one of the deserves to be heard.

Personally, as somebody who manages multiple WordPress sites on GoDaddy, but has never used ManageWP, I’m rather looking forward to seeing what the company comes up with.

First dot-brand gTLD to go generic after TLS deal

Kevin Murphy, September 5, 2016, Domain Registries

The would-be dot-brand gTLD .observer will actually open as an unrestricted generic after the contract was bought out by Top Level Spectrum.

TLS, which has a small portfolio of gTLDs already, bought out the ICANN contract from UK newspaper publisher Guardian News and Media a couple of months ago, it emerged today.

The Observer is the title of the Guardian’s sister paper, published on Sundays.

But TLS CEO Jay Westerdal said it will be sold as a generic with pricing under $10 per name, as a thematic stable-mate for its gripe-oriented gTLD .feedback.

The price of the TLD has not been revealed, but Westerdal characterized it as a sub-$1 million deal.

It’s the first instance of a dot-brand, albeit one that that not yet gone live, being taken over by a portfolio gTLD player.

Westerdal said he’s looking for more, similar acquisition opportunities.

The gTLD is currently in pre-delegation testing, with no published go-live date.

The Guardian had signed a Registry Agreement containing Specification 9. That allows registries to disregard the Code of Conduct — which obliges them to treat registrars equally.

It seems likely this will have to be removed from the RA before .observer can go to the masses as a proper generic.

NamesCon confirms three more shows after being acquired

Kevin Murphy, August 19, 2016, Domain Services

NamesCon says it has booked the venue for three more years of domain name conferences, following its acquisition this week.

The conference organizers said today that it has been acquired by 13-year-old German events outfit WorldHostingDays, which usually focuses on the hosting market, for an undisclosed sum.

NamesCon said in a press release that all existing commitments — such as tickets and sponsorship deals — will be honored, and that the same folk will still run the 2017 conference.

It said that it has booked the Tropicana hotel in Las Vegas, venue for the first three events, for the next three years.

The next three events will be held January 22 – 25, 2017, January 28 – 31, 2018 and January 27 – 30, 2019, the company said.

NamesCon focuses on the business of domain names, providing sessions on the buy and sell sides of the business.

Afilias buys three gTLDs from Starting Dot

Kevin Murphy, August 9, 2016, Domain Registries

Registry upstart StartingDot has sold its small portfolio of new gTLDs to Afilias.

.archi, .bio and .ski are the three components of the package.

While the size of the deal was not disclosed, retail prices and zone file volumes suggest the portfolio probably brings in about $2 million a year in revenue.

The biggest seller of the three is .bio, which was originally intended for farmers but its basically unrestricted and has a variety of use cases.

Given the high ticket price — around $90 a year retail — .bio has a surprisingly impressive 14,000 names under management.

.archi and .ski have fared less well, with 3,500 and 6,200 names in their respective zones. Both have premium fees — retailing at about $100 and $60 a year respectively.

Due to the high prices, Afilias gets to call these TLDs “premium”.

.archi is the only one of the three to have registration restrictions — you need to be an architect to get one.

Both .archi and .bio have been available to buy for a couple of years, while .ski’s first renewal cycle is about a month away.

All three sell predominantly through European registrars. Starting Dot is itself based in Paris and Dublin.

The deal seem to have been struck due to Afilias’ we-buy-any-TLD offer, which executives discussed with us a year ago.

Afilias said that StartingDot execs Godefroy Jordan and Stephane Van Gelder will continue to be employed for a transition period.