Latest news of the domain name industry

Recent Posts

XYZ hires .top guy as first China employee

Kevin Murphy, October 11, 2016, Domain Registries

XYZ.com has hired its first Beijing-based employee, as part of its ongoing plan to formally enter the Chinese market.

The company said yesterday that it has appointed Mason Zhang, until recently chief marketing office at .top gTLD registry Jiangsu Bangning Science & Technology Co, as its new director of business development for China.

It’s part of XYZ’s seemingly interminable entry to the Chinese market, which is over a year old.

While the majority of .xyz’s registrations have been into China, the registry (along with pretty much every other Western registry) still does not have the necessary government permissions so that its customers can start using their names.

It kicked off a process to get ICANN approval for its Chinese gateway, operated by ZDNS, a year ago, and set up the mandatory Wholly Owned Foreign Enterprise in January.

The company said in a blog post that it expects to get its Chinese accreditation “very soon”.

Zhang’s former employer, .top, is second only to .xyz in terms of new gTLD registration volume, also due to Chinese sales. It has about 3.7 million names in its zone file, compared to .xyz’s 6.1 million.

Chinese investor pumps $7 million into M+M as .vip pushes firm into profit

Kevin Murphy, September 20, 2016, Domain Registries

Minds + Machines made a profit, kinda, in the first half of the year, due to the popularity of .vip in China.

The company today announced a loss of $1.9 million for the six months to June 30, compared to a $1.6 million loss in the comparable 2015 period, on revenue that was up 115% at $7.4 million.

But factoring out discontinued operations — M+M started to close its registrar and registry back-end businesses during the half — it actually managed to sneak a profit of $56,000.

Its revenue was also unaffected by one-time gains from gTLD auction losses, something which had pumped up its top line regularly for the last few years.

Chairman Guy Elliot said in a statement to the markets that M+M “has successfully been navigated out of troubled waters”.

The turnaround is due in no small part to the success of .vip, which racked up over 400,000 registrations in its first month (back in May), the large majority of which were sold to Chinese investors.

The company said that $5.5 million of the $8 million in H1 billings were made in the first 21 days of .vip’s availability.

Having started 2016 with no sales in Asia whatsoever, it expects 45% of its revenue to come from China by the end of the year.

As a direct consequence of .vip’s sales, M+M has received a £5.5 million ($7.2 million) investment from Goldstream Capital Master Fund I, a Cayman Islands shell company owned by Chinese private equity firm Hony Capital.

Hony, which manages $10 billion in assets, is perhaps best known for owning the pizza restaurant chain Pizza Express, which it acquired for $1.54 billion in 2014.

According to its web site, Hony’s own investors include three large Chinese state-owned investment vehicles.

The investment deal includes clauses preventing Hony from trying to get a director on M+M’s board and/or launching a hostile takeover bid.

It will own 7.17% of M+M after buying 50 million shares at £0.13 each, assuming M+M’s simultaneously announced £13 million ($17 million) share buyback is fully subscribed.

M+M opened a subsidiary in China (a Wholly-Owned Foreign Enterprise) during the half, in order to better serve the Chinese market and comply with Chinese government regulations.

It simultaneously laid off 44% of its staff in the US — engineers no longer needed due to the shift into an almost entirely marketing-focused business — and expects to end the year with only 13 employees there.

One in seven new gTLD domain names are actually just numbers

Roughly one out of every seven new gTLD domain names active today is numbers-only before the dot, according to DI research.

It might be surprising to some that the DNS, designed to turn immemorable numbers into memorable names, is actually being used to register millions of numeric domains.

Using the almost 1,000 new gTLD zone files we had access to on July 19*, DI counted 20,933,637 unique domain names of which 3,259,684 were purely numeric.

In other words, 15.57% of new gTLD domain names only contain numbers before the dot.

Fourteen gTLDs have a third or more of their zones fully numeric. One is two-thirds numeric.

The reason for this, of course, is China.

Numeric domains are said to be popular in China due to the fact that digits are the only 10 characters permissible in DNS that Chinese speakers natively understand.

Many popular web sites in China use short, numeric .com or .cn domain names. Some short numeric domains have sold for six or seven figures to end-user companies.

So there’s a thirst for numerics among Chinese domainers, as well as domainers elsewhere who want to exploit the Chinese market.

I talked to a successful domainer recently who acquired thousands of numeric domain names purely to flip to Chinese investors.

Personally, I think the market is overblown. Data suggests there’s a limited appetite for numerics among actual end users.

Fewer than 2,700 of top one million most-visited domains, as ranked by Amazon’s Alexa service, are numeric. A quarter of a percent. Even if Alexa is wrong by a factor of 10, that’s still only 2.7% of the internet’s biggest sites using numeric domain names.

So which gTLDs are most exposed to the numeric market?

Surprisingly, given the registry’s reluctance to deeply discount its domains, two Donuts gTLDs — .gold and .run, both relatively small TLDs — top the table with 66.32% and 54.65% respectively.

I think these are anomalies. The majority of Donuts’ portfolio have far smaller percentages of numerics.

Fellow portfolio players Afilias (.bet, .kim) and Uniregistry (.lol, .mom) also feature prominently on the list.

Here’s the top 30 new gTLDs, ranked by the percentage of their zones that are numeric. It includes every gTLD over 20%.

TLDTotal DomainsNumerics%
gold9,2366,12566.32
run16,2268,86754.65
bet25,50312,40448.64
lol95,69745,15447.18
rip3,0781,35844.12
men15,5906,82243.76
mom49,41820,96442.42
kim117,98448,26240.91
wang1,065,295404,05937.93
pink40,02714,53136.3
black22,1327,65234.57
xin119,52240,55533.93
win951,275318,62233.49
vin5,8151,90832.81
ink23,5827,08230.03
fund7,0482,05729.19
ooo18,7605,46029.1
blue41,03011,72728.58
red308,88085,12127.56
vip276,56575,92527.45
pet7,9852,07926.04
rent6,9931,73824.85
top2,611,513599,27822.95
bid368,92283,34122.59
date188,20341,81522.22
ren306,37367,67822.09
gift26,7155,75221.53
wiki18,1083,76220.78
club769,527159,49320.73
sale10,6042,16220.39

In absolute terms, the larger-volume registries naturally have the larger number of numeric domains in their zones.

XYZ.com’s .xyz alone has over 867,000 numeric domains in its zone. That’s a lot of names, but in percentage terms it’s below the industry mean.

.top, .wang, .win and club, all heavily marketed in China, fill out the top five in volume terms.

Here’s the top 30 gTLDs with the largest absolute number of numerics. They account for 3,099,981 numeric domains of the 3,259,684 industry total.

TLDTotal DomainsNumerics%
xyz6,051,039867,45514.34
top2,611,513599,27822.95
wang1,065,295404,05937.93
win951,275318,62233.49
club769,527159,49320.73
red308,88085,12127.56
bid368,92283,34122.59
vip276,56575,92527.45
ren306,37367,67822.09
site417,02358,22913.96
kim117,98448,26240.91
lol95,69745,15447.18
date188,20341,81522.22
xin119,52240,55533.93
loan242,01332,53713.44
mom49,41820,96442.42
tech134,00216,80412.54
pink40,02714,53136.3
pub63,85812,45319.5
bet25,50312,40448.64
blue41,03011,72728.58
news76,72511,06814.43
online301,06810,8263.6
website157,47810,5376.69
party206,43010,2364.96
run16,2268,86754.65
download71,0488,85312.46
help50,4528,14516.14
black22,1327,65234.57
one58,5427,39012.62

While short domains are more attractive to investors and end users, the vast majority of numeric domains in new gTLDs are of course longer than five digits.

.xyz, for example, has over 757,000 numeric domains of six or more characters. .top, .wang and .win are also measured in the hundreds of thousands in this regard.

Four gTLDs — .club, .wang, .top and .xyz — are over 99% full when it comes to five-digit numeric domains (that is, they have over 99,000 numeric domains in their zones).

.win is over 95% full on that basis, after which the numbers drop sharply to 65% and below.

In terms of four-number domains, there are 10 gTLDs that are over 99% full and 16 over 90% full.

There are 36 new gTLDs over 90% full in terms of three-digit numeric domains. More than a dozen appear to be completely full (giving myself some wriggle-room for reserved names and those that otherwise don’t appear in the zone files).

So what to make of all this?

I’m not a domainer, but I’ve sometimes heard domainers compare domains to baseball cards.

Going with that analogy, I’d say that if the typical numeric domain name collection contains the odd vintage Babe Ruth**, he’s far outnumbered by cards depicting some guy’s kid playing catch in the park.

That may be true of all domain portfolios, numeric or otherwise, but I feel numerics exist primarily right now to be traded between domainers.

As long as this continues, new gTLD registries — at least the ones actually charging for their names — will continue to benefit.

* A note on methodology. Due to the way access to zone files via ICANN works (ie, sporadically) we were missing some zone files on July 19. Including the missing gTLD may alter the league tables presented above, but I don’t believe the missing data was significant to the overall totals. Only one of the top 100 gTLDs, a zone of about 28,000 names, was missing.

** I know nothing about baseball.

Cruz-Duffy bill would put brakes on IANA transition

Kevin Murphy, June 9, 2016, Domain Policy

America’s continuing unique oversight role in the DNS root management system, fuck yeah!

That’s basically the takeaway from a new bit of proposed US legislation, put forward by Sen. Ted Cruz and Rep. Sean Duffy in both houses of Congress yesterday.

The two Republican Congressmen have proposed the inappropriately named Protecting Internet Freedom Act, which is specifically designed to scupper the IANA transition at the eleventh hour.

PIFA would prevent the National Telecommunications and Information Administration from backing away from its role in the DNS root management triumvirate.

It’s supported, ironically, by a bunch of small-government right-wing think tanks and lobby groups.

If the bill is enacted, NTIA would need a further act of Congress in order to cancel or allow to expire its current IANA functions contract with ICANN

The bill (pdf) reads:

The Assistant Secretary of Commerce for Communications and Information may not allow the responsibility of the National Telecommunications and Information Administration with respect to the Internet domain name system functions, including responsibility with respect to the authoritative root zone file and the performance of the Internet Assigned Numbers Authority functions, to terminate, lapse, expire, be cancelled, or otherwise cease to be in effect unless a Federal statute enacted after the date of enactment of this Act expressly grants the Assistant Secretary such authority.

The bill also seeks to ensure that the US government has “sole ownership” of the .gov and .mil TLDs “in perpetuity”.

These ownership rights are not and have never been in question; the inclusion of this language in the bill looks like a cheap attempt to stir up Congresspeople’s basest jingoistic tendencies.

A Cruz press release said the IANA transition “will allow over 160 foreign governments to have increased influence over the management and operation of the Internet.”

Duffy added:

President Obama wants to hand over the keys to the Internet to countries like China and Russia. This is reckless and absurd. The governments of these countries do not value free speech. In fact, they censor the Internet and routinely repress and punish political dissidents. They cannot be trusted with something as fundamental to free speech as a free and open Internet.

It’s unfiltered scaremongering.

No country — not China, Russia, the US nor any other government — gets increased powers under the IANA transition proposal, which was painstakingly crafted by, and is now supported by, pretty much all community stakeholders over two years.

In fact, governmental power is significantly curtailed under the proposal.

Post-transition, the Governmental Advisory Committee’s current voting practice, which essentially requires unanimity, would be enshrined in ICANN’s bylaws.

If the GAC came to ICANN with advice that did not have consensus — that is, some governments formally objected to it — ICANN would be able to reject it much more easily than it can today.

The one area where the GAC does get a new role is in the so-called “Empowered Community”, a new concept that will enter the ICANN bylaws post-transition.

The Empowered Community would be a non-profit legal entity formed by the ICANN community in the exceptional event that the ICANN board goes rogue and starts doing really egregious stuff that nobody wants — for example, introducing Draconian policy regulating freedom of speech.

The EC would have the power to kick out the ICANN board members of its choice, reject the ICANN budget, throw out proposed bylaws amendments and so on. As far as ICANN is concerned, the EC would be God.

Its members, or “Decisional Participants” would be the GNSO, the ccNSO, the ALAC, the ASO and the GAC.

The fact that the GAC has a seat at the EC table is the straw that Cruz, Duffy and co grasp at when they talk about governments getting increased power in a post-transition ICANN.

But the GAC’s voice is equal to those of the other four participants, and the GAC is not allowed a vote on matters stemming from ICANN’s implementation of consensus GAC advice.

In other words, the only way Cruz’s boogeymen governments would ever get to push through a censorship policy would be if that policy was also supported by all the other governments or by the majority of the diverse, multi-stakeholder ICANN community.

The arguments of Cruz and Duffy are red herrings, in other words.

Not only that, but the US record on attempted censorship of the DNS root is hardly exemplary.

While it’s generally been quietly hands-off for the majority of the time ICANN has had its hand on the rudder, there was a notable exception.

The Bush-era NTIA, following a letter-writing campaign by the religious right — Bible-thumping Cruz’s base — exerted pressure on ICANN to reject the proposed porn-only .xxx gTLD.

So who’s the real threat here, Red China or Ted Cruz, the man who tried to ban the sale of dildos in Texas?

The Protecting Internet Freedom Act is obviously still just a bill, but Republicans still control both houses of Congress so it’s not impossible that the tens of thousands of hours the ICANN community has put into the IANA transition could be sacrificed on the altar of embarrassing the President, who is probably Kenyan anyway.

China conference leads to 49% .vip spike

The Global Domain Industry Conference, held in China over the weekend, has led to a huge boost in .vip domain sales.

Registry Minds + Machines told the markets this morning that the recently launched gTLD hit 404,892 as of 1600 UTC yesterday, up 49% from Friday.

CEO Toby Hall confirmed to DI that China is very much behind the spike, and that the conference helped raise the profile of .vip.

Billings and orders have now hit $5.5 million, up from $3.2 million on May 22, M+M said. That number includes sunrise and premium sales.

At GDS, M+M sold eight .vip domains auction for a total of $232,000 before auction commissions, which very likely inspired the spike in base-fee registrations.

Photos of GDS published on social media yesterday show a packed auditorium, with hundreds of attendees.

While M+M makes much of the fact that it has not used a “freenium” strategy for .vip — which it says may lead to better renewal rates than competitors — retail prices are still pretty damn cheap.

At West.cn, its leading Chinese registrar, a .vip can be had today for about $3. It’s closer to $10 at GoDaddy.

Today’s batch of zone files have not yet been published by ICANN for verification, but yesterday there were 245,872 names in .vip.