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.CLUB revenue not all that

Kevin Murphy, August 21, 2018, Domain Registries

.CLUB Domains may be one of the 5000 fastest-growing companies in the US, according to Inc magazine, but it’s returning the majority of its revenue back to its registrars.

CEO Colin Campbell revealed this week that the company returns almost 70% of its gross revenue in the form of rebates.

The revelation came in an interview with Domain Name Wire on its latest podcast.

Campbell told Andrew Allemann that in 2017 .CLUB had $9.3 million in what he called “cash flow” or “gross revenue”.

But “net cash” or “net revenue”, after rebates was just $2.8 million, meaning $6.5 million was returned to registrars via promotions.

The interview came a few days after Inc named the company 1164th in its 2018 list of fastest-growing US companies.

Inc had .CLUB’s revenue at $7.2 million, but that appears to have been calculated using the usual accounting standards of deferring revenue into future periods over the lifetime of the domain subscription.

.club has something like 1.4 million names under management.

Campbell said that the company is “adding about a million dollars of net revenue per year” and he predicted 2018 gross cash to come in at $10.5 million and net to come in at $3.7 million.

That’s a net revenue figure, remember, not a profit or net income line. Campbell said he’s more interested in growing the business rather than paying taxes on profits.

The aggressive rebating seems to have a focus in China, where it has regular deals with the likes of Alibaba (which was .club’s biggest registrar with 20% of the market at the last count) and West.cn.

While .CLUB is private, Campbell has been frank about its performance in the past.

The DNW interview follows DI’s interview with Campbell on more or less the same topic last September, and DNW’s in 2016.

It’s a good podcast, you should have a listen.

.CLUB revenue reportedly $7.2 million

Kevin Murphy, August 16, 2018, Domain Registries

.CLUB Domains had $7.2 million of revenue in 2017.

That’s according to Inc magazine, which ranked the company at 1164th in its 2018 Inc 5000 list of the fastest-growing US-based companies.

Growth over three years for .CLUB, which is listed as having 17 employees, was 419%, according to the profile.

.club is one of the best-performing new gTLDs in terms of volume, with over 1.3 million domains under management, according to the company.

While it has generally steered away from deep discounting, it has in recent weeks benefited from a huge increase in sales — adding over 100,000 names to its zone file in just a few days earlier this month — as a result of a sale at the Chinese registrar Alibaba, which sold .club names for the RNB equivalent of $0.44.

That had the effect of diverting .club from a decline that looked like it would shortly have seen it dip below one million zone names for the first time in over a year.

CentralNic and .CLUB reveal premium sales

Kevin Murphy, November 8, 2017, Domain Services

CentralNic and .CLUB Domains have both revealed sales of premium domain names over the last several days.

CentralNic said yesterday that it has sold “a number” of premiums for $3.4 million.

The names are believed to be from its own portfolio, rather than registry-reserved names in any of the TLDs it manages. The company did not disclose which names, in which TLDs, it had sold.

The sale smooths out potential lumpiness in CentralNic’s revenue, and the company noted that the sales means that recurring revenue from its registrar and registry business will become an increasing proportion of its revenue as its premium portfolio diminishes.

Last week, .CLUB announced that it sold $380,793 of premium .club domains in the third quarter. That was spread over 452 domains.

The big-ticket domains were porn.club and basketball.club, sold by the registry for $85,000 together.

The Q3 headline number was a sharp decline from the Q2 spike of $2.7 million, which was boosted by auctions in China.

The company published a lot more data on its sales on its blog, here.

.CLUB HQ trashed by Irma, nobody hurt

Kevin Murphy, September 12, 2017, Domain Registries

.CLUB Domains returned to its new digs in Fort Lauderdale, Florida yesterday to find the building trashed by hurricane Irma.

Irma damage

Fortunately, none of the .club gTLD registry’s 17 employees were hurt during Irma, the category 5 hurricane which lashed Florida over the weekend.

Irma caused at least 10 reported deaths in the state and untold amounts of property damage. Over its full path, close to 50 people have been reported killed.

Chief marketing officer Jeff Sass said that “large parts of the roof had been torn away, exposing our office to devastating wind and rain, pretty much ruining everything”.

“Literally, it looks like a bomb went off. I couldn’t believe the damage. It’s truly a sad day for our company. We feel for everyone affected by this horrible storm and we are very fortunate as all our staff are safe,” CEO Colin Campbell said in a blog post.

Ironically, the building had been scheduled for a refurbishment anyway.

.CLUB plans to use the facility as a tech startup incubator under the brand Startups.club. It had recently been approved for funding by the local Fort Lauderdale government, according to Sass.

None of the company’s registry operations, which are based hundreds of miles north in Virginia, were affected by the damage.

Fellow new gTLD registry MMX is legally based in the thoroughly devastated British Virgin Islands, but has no staff or premises there so was unaffected.

Domain Name Wire is reporting that some registry functions of Anguilla’s .ai ccTLD, also in Irma’s path, were not working in its wake.

Photo: .CLUB Domains

Registry bosses to talk ICANN “tax cuts” at private meeting

Kevin Murphy, September 5, 2017, Domain Registries

The CEOs of 20 or more gTLD registries are due to meet privately this month to discuss, among other things, the possibility of a reduction in their ICANN fees.

The Registry CEO Summit is being held in Seattle at the end of September, I’m told.

Jay Westerdal of Top Level Spectrum (.feedback etc) and Ray King of Top Level Design (.design etc) are organizing the event.

“It’s a small, informal gathering, where the agenda will be set by the participants, most likely around best practices for running a new registry,” Westerdal said.

“It’s not an official group like the RySG, and we don’t expect to be putting out any statements or ‘work product’,” he said.

He said he expects 20 to 25 registry CEOs to attend.

.CLUB Domains CEO Colin Campbell, who said he will attend, said he intends to bring proposals to the meeting around persuading ICANN to support the industry with marketing support and fee reductions.

Campbell wants ICANN to commit to spend $4 million on marketing new gTLDs at trade shows and conferences.

He also wants ICANN to reduce its $0.25 per-domain registry fee, which he referred to as a “tax”, to $0.18 for three years (which would match the $0.18 registrars pay ICANN per transaction).

He said the money would ideally flow through into the pockets of registrants, rather than the industry.

“I’m not suggesting that it be permanent, I’m suggesting that in order to support the fledgling new gTLD industry that they offer a small reduction and hope registries will pass that on to registrars and hopefully registrars will pass that on to consumers,” Campbell said.

The reduction would also help raise awareness of new gTLDs, he said.

The $0.25 fee only kicks in when a registry tops 50,000 billable transactions per year, so the reduction would at first only affect the roughly 50 to 60 new gTLDs that are already over that milestone.

The $0.07 per-domain reduction is so small that even a registry as large as .club, with about a million domains, would only see its fees reduced by about $70,000 per year.

Over all the affected TLDs, it would come out to a cost to ICANN of about $1.2 million per year if current volumes hold.

“It’s a very small amount but I still believe the benefit goes to end users,” Campbell said.

For registrants, it’s difficult to imagine $0.07 making a huge difference, unless they’re a high-volume buyer (which are not always the buyers you want). Generally, the cheaper domains get the more they attract abusive registrants.

Whether the ideas will get any traction among other registry CEOs remains to be seen, but it’s not the first idea for reduced ICANN fees to come out of the registry community recently.

In March, the RySG formally asked ICANN to tap into its war chest of excess new gTLD application fees to waive 75% of its fixed $25,000 annual per-TLD fee, a move that would affect all new gTLDs rather than just the larger ones.

The rebate would have cost ICANN $17 million.

But ICANN knocked that idea back last week, saying it still does not know how much of this $96 million cash pile it will have to spend on unexpected events stemming from the program.