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.CLUB nears profitability, talks renewals and “trial” domains

Kevin Murphy, September 4, 2017, Domain Registries

.CLUB Domains is nearing profitability and poised to become a “growth engine”, despite the view that most of its current domains are not expected to renew, according to its CEO.

Colin Campbell told DI today that the company made $6.7 million in revenue last year, and is “very close” to breaking even.

The company reached one million domains under management milestone in June, but Campbell freely admits that the majority of its current domains are unlikely to renew.

Almost 700,000 of these domains are what .CLUB considers “trial accounts”, he said. These are domains that typically sold for under a dollar — .club has been seen for sale as low as $0.88 — to speculators.

The registry usually sees a 10% to 15% renewal rate on these domains, he said.

Of the remaining 300,000 “solid, regular registrations”, Campbell said he sees first-year renewals in the 68% to 70% range and subsequent years at 80% to 90%.

The company typically only discounts on its first-year registrations, so renewal rates are a much better indicator of performance.

He said .club has around 120,000 web sites (not including parked domains), some of which are showcased on its web site.

With this in mind, renewals are at the forefront of Campbell’s mind. He said a key performance indicator .CLUB uses is “average cost of acquisition per renewed domain”, which the company tracks on a per-registrar basis.

The company invested $3.3 million in marketing in 2016, he said. That does not include rebates to registrars participating in volume programs, but it does take into account acquiring prominent shelf space on key registrars, he said.

“We’re very close to break-even and we’re still going to be able to invest multi-million dollars in ad campaigns and marketing,” he said.

“We’re going to have a company that’s breaking even and is still going to be a growth engine,” he said. “We’re going to be able to sustain a path of growth. I don’t know too many TLDs who could say that. Of course, if you reduce your expenses down to nothing you can make a profit, but can you also be a growth engine?”

“That’s where I feel like a TLD needs to get to, to be a sustainable long-term presence in the market, like a .org or .net or .co,” he said.

Despite the narrowing losses and starkly higher volumes, the $6.7 million in 2016 revenue is a lower than the $7 million in 2015 revenue Campbell told Domain Name Wire about a year ago.

Campbell said today that the reason for the dip is that late 2015 saw many gTLDs (old and new, even including .com) benefit from a bump from the Chinese market. .CLUB’s top line was particularly exposed by some premium sales it made to Chinese investors during that growth spike.

Premium sales have also been performing well in 2017, Campbell said, driven by the financing options and broker program introduced in January.

.CLUB announced first-quarter premium sales totaling $505,000 and $2.5 million in Q2.

.club premium sales approaching $5 million

Kevin Murphy, April 11, 2017, Domain Registries

.CLUB Domains sold half a million dollars worth of reserved premium names in the first quarter, bringing its cumulative to-date total to almost $5 million, the registry reported at the weekend.

Q1 sales were $505,139, the company said, bringing its total since launch to $4,844,428.

There were 475 premium sales in total, sold via auctions, registrars and aftermarket platforms, it said.

Headline sales in the period included seniors.club and pet.club for $18,000 apiece, and photo.club for $10,000.

The numbers may indicate that its broker program and financing options, introduced in January, may be taking off.

The registry’s Q1 sales amount to more than half of what it sold in the whole of 2016.

More sales figures are available in the .CLUB Domains blog post.

.club financing option sees early traction with $150k sales

Kevin Murphy, February 6, 2017, Domain Registries

.CLUB Domains said it has seen some early successes with its new 0% financing option, selling $150,000 worth of premium .club domains in its first week.

The registry announced that it sold 39 premiums for a total of $149,480, and that 37 of those names were sold using the financing option.

This option allows registrants to spread the cost of their domains over five years — 60 monthly payments — for names priced over $1,000.

The scheme was announced at the NamesCon conference in conjunction with a new brokers program, which gives brokers the ability to pass on 10% discounts to their clients and earn 15% commissions.

Seventeen of the 39 names were sold via brokers.

The results of the the first seven days of these programs compare favorably to other periods. In the fourth quarter of 2016, .CLUB said premium sales were $112,000.

For the whole of 2016, the registry sold $941,000 of reserved premium names, making a total of $4.3 million since .club launched May 2014.

Buy a $10k .club, get a free T-shirt

Kevin Murphy, December 13, 2016, Domain Registries

.CLUB Domains will today release 9,200 previously reserved .club names into the channel at premium prices.

Club T-ShirtThe registry is also offering free T-shirts to the first 500 people to purchase a premium name for $59.99 and more, personalized with said name.

While the names will become available at 1500 UTC today, the full list is not expected to be published until midnight UTC at landrush.club

CMO Jeff Sass gave the following list of examples of names to be released: watches.club, vino.club, ocean.club, elite.club, driving.club, comicbook.club, Chinese.club and gambling.club.

A thousand of the names are three-character strings.

The first-year prices are suggest at between $100 and $10,000 at the retail level, Sass said.

All premium names renew at standard-name pricing, he said.

The T-shirt offer requires the user to tweet using promotional hashtags and expires December 31.

.xyz, .club and .vip get the nod to sell in China

Kevin Murphy, December 5, 2016, Domain Registries

The Chinese government has granted licenses to operate in the country to its first tranche of new gTLDs — .vip, .club and .xyz.

The agreements mean that Chinese registrars will be able to give their Chinese customers the ability to actually use their domains for web sites.

It also means the companies will be obliged to censor domains the government does not like, but only those domains registered via Chinese registrars.

The Ministry of Industry and Information Technology announced the licenses, given to the Chinese subsidiaries of Minds + Machines, .CLUB Domains and XYZ.com respectively, today.

M+M CEO Toby Hall told DI that it’s “a great moment of support for Chinese registrars”, giving them a “very clear signal about which TLDs they can focus on”.

XYZ.com said in a blog post that some of its Chinese registrars (its biggest channel) are planning on offering discounts to celebrate the approval.

It’s always been possible for Chinese people to register new gTLD domains via Chinese registrars — it’s estimated that 42% of the 27 million new gTLD domains in existence today are Chinese-owned.

However, Chinese citizens need a government license if they want to launch a web site, and the government only issues licenses for domains in approved TLDs.

In addition to .cn and China-based gTLDs, which were the first to be given the nod, Verisign was approved earlier this year for .com.

Hall said that while .vip has been popular with Chinese domainers, the MIIT license means it can start to tap the small business market there too.

Obtaining the license means that the three registries, which are all based in the US or Europe, will have to comply with Chinese regulations when it comes to Chinese customers.

That basically means the Chinese government gets to censor pretty much anything it doesn’t like, up to and including sites that “spread rumors”.

Hall said that there’s no chance of this censorship bleeding out to affect non-Chinese customers.

M+M, along with XYZ and .CLUB, are using Chinese registry gateway ZDNS to act as a proxy between their own back-ends (Nominet for .vip, Neustar for .club and CentralNic for .xyz) and Chinese registrars.

“All of our Chinese web sites go through ZDNS, so only web sites going through ZDNS would be affected,” Hall said, referring to the censorship rules.

Hall added that he was “not aware” of there being a blocklist of politically sensitive strings that Chinese customers are not allowed to register.

.xyz passed two million names, growing like crazy

Kevin Murphy, February 9, 2016, Domain Registries

The .xyz gTLD at the weekend became the first new gTLD to pass the two million domains mark, as it experiences ridiculously fast growth.

Its zone file has grown by 274,315 domains in the last seven days, hitting 2,092,346 yesterday.

It added 130,000 names on Saturday alone.

That’s the kind of growth more usually associated with .com, and pre-2012 new TLD launch periods.

It’s reasonable to assume that the majority of these names are being registered for investment purposes. It seems Chinese registrars processed much of the spike.

But XYZ.com isn’t the only registry that saw a big spike over the weekend.

.CLUB Domains’ .club added almost 44,000 names to its zone between Saturday and Monday. Its usual daily add rate is around the 1,000 mark.

New gTLD registries talk up marketing plans at NamesCon

Kevin Murphy, January 15, 2015, Domain Registries

This week’s NamesCon conference here in Las Vegas, which ended yesterday, offered several new domain registries the chance to talk about their efforts past and future to market new gTLDs.

One theme to emerge was how registries need to work with each other and with their registrar channel partners to raise awareness of alternatives to .com.

Donuts VP Dan Schindler said during a Tuesday keynote that the company plans to ramp up its marketing in 2015.

“There’s still a tremendous amount of work to be done by all the beneficiaries in this process,” he said, saying that Donuts intends to carry out a “broad education and awareness program over course of 2015 and beyond”.

He said the company is pursuing co-marketing efforts with some of its registrar partners at trade shows and such and “possibly including television”.

Schindler also spoke out against paid placement — where registries pay popular registrars for prominent shelf space — “not because we’re cheap”, but because Donuts doesn’t believe it offers registrants the best choice of relevant TLDs.

Here’s a photo of Schindler talking, offered for no other reason than it just cost me £6 to upload from my phone. Note the juxtaposition of a) the extensive Verisign .com/.net sponsorship, b) the Donuts “Not Com Revolution” messaging, and c) my thumb.

Dan Schindler

Uniregistry CEO Frank Schilling said in his keynote an hour later that he expected “more marketplace collaboration… where it is in our best interest to collaborate” on new gTLD promotion.

But he offered a somewhat dissenting tone with regards what he called the “dog and pony shows” of marketing new gTLDs.

Saying the company is “bootstrapping” some of its strings, he said big marketing spends now would lead to Uniregistry needing to raise its prices in two to three years to cover today’s costs.

Instead, he pointed to efforts such as its decision to release most of .click’s available names for a flat, cheap registration fee at launch, which he said should get names into the hands of users more quickly.

Contrarily, .CLUB Domains CEO Colin Campbell boasted during a brief pre-auction address on Tuesday of his company’s $2.2 million marketing spend for 2014, which he said would increase to $3.5 million in 2015.

Another recurring theme emerging from the conference (and from every other new gTLD event I’ve ever been to) was, as Schindler put it, that “use begets use”. The more high-profile sites a gTLD gets, the more likely it is to gain mindshare and sell more domains.

DotStrategy, the .buzz registry, is to be the beneficiary of such customer marketing.

Howard Lefkowitz, CEO of travel site operator One Degree World (which revealed it paid $100,000 for vegas.club earlier this week) revealed during NamesCon that some of his company’s city-related .buzz domains, such as sydney.buzz, are to feature for two weeks on the US TV game show Wheel Of Fortune as prize sponsors.

Will we see a bump in .buzz sales as a result? The gTLD currently has fewer than 8,500 names in its zone file, so if the TV time bears fruit it should be fairly easy to spot.

“Second most marketable athlete in the world” to use a .club domain

Kevin Murphy, November 17, 2014, Domain Registries

Virat Kohli, a famous Indian cricketer, is .CLUB Domains’ latest star anchor tenant.

He’s launching his first ever official web site, at viratkohli.club, today.

No, I’ve never heard of him either, but he’s been called the “second most marketable athlete in the world” after Lewis Hamilton by SportsPro, a UK sports marketing business-to-business magazine.

The 26-year-old has captained the Indian national side and holds various records in the world of cricket.

Just yesterday, he became “the first batsman to score 1000 ODI runs in a calendar year for four years in a row”, which is probably very impressive if you know what it means.

He has almost 4.5 million Twitter followers and over 18 million Facebook “likes”, which means his links to his new site, should he choose to post any, will reach a wide audience in nations where cricket is popular.

His adoption of .club, which seems to be a result of a deal with .CLUB, follows the launch of 50 Cent’s 50inda.club. Singer Demi Lovato also has a .club for her official site, apparently purchased of her own volition.

.club first new gTLD to sell 100,000 domains

Kevin Murphy, August 29, 2014, Domain Registries

.club hit a landmark this week with its 100,000th domain name registration, according to .CLUB Domains.

It’s the first new gTLD to get to this level of success without giving away names for free — .xyz and .berlin have over 460,000 and 130,000 names respectively but fall under 100k if you factor out the freebies.

The .club zone file showed 98,984 names (excluding swelling from the name collisions program) last night, and it’s been growing at steady rate of roughly 250-300 names per day.

It appears that there are 1,000 or so names that do not appear in the zone file, perhaps because they’re not configured yet.

.club hit general availability May 7, 114 days ago.

ICANN smacks new gTLDs for pre-sunrise auctions

Running a premium domain name auction before you’ve finished your new gTLD sunrise period is Officially Not Cool, according to ICANN’s compliance department.

People who won premium new gTLD domains in auctions that took place before sunrise periods now face the possibility of losing their names to trademark owners.

.CLUB Domains, and probably XYZ.com, operators of .club and .xyz, two of the highest-volume new gTLDs to launch so far, appear to be affected by the ICANN decision.

ICANN told .CLUB that its “winter auction“, which took place in late February, may have violated the rules about allocating or “earmarking” domains to registrants before sunrise takes place.

Meanwhile, NameJet has cancelled the auction for deals.xyz, which “sold” for $8,100 late last year, suggesting that .xyz’s pre-sunrise auction is also considered ultra vires.

ICANN told .CLUB that its auction sales “constitute earmarking” in violation of the rule stating that registries “must not allow a domain name to be allocated or registered prior to the Sunrise period”.

.CLUB had told its auction winners that a sunrise period registration would prevent them from getting the domain they wanted and that they would be refunded if a sunrise registrant emerged.

But ICANN evidently told the registry:

Irrespective of whether “[a]llocation was expressly conditioned upon any Sunrise claim,” or whether any Sunrise claim was made, the pre-selection, pre-registration or pre-designation to third parties, in this case via .Club Domains’ “winter auction,” constitutes improper allocation.

I kinda thought this would happen.

Back in November, when XYZ.com ran its first .xyz auction — about six months before its sunrise even started — CEO Daniel Negari told us he believed it was “comfortably within the rules“.

We said the auction “seems to be operating at the edge of what is permissible under the new gTLD program’s rights protection mechanisms, which state that no domains may be allocated prior to Sunrise.”

I’ve not yet been able to definitively confirm that .xyz is affected by this ICANN decision, but .club definitely is.

.CLUB Domains told its auction winners today that the names they won are now subject to a 60-day period during which they could be obtained by trademark owners.

If no trademark owner claims the name, .CLUB said it will give the auction winner a 10% rebate on their purchase price.

The email states:

We are placing the domain on hold for 60 days, during which time a Trademark Clearinghouse (TMCH) holder will have the opportunity to purchase the domain at Sunrise rates. Although, the domain is not currently in the TMCH, if a trademark holder should file in the TMCH over the next 60 days, the domain will be offered to that registrant. However, if the name is not claimed by filing in the TMCH over the next 60 days, your transaction will move forward as planned.

Although we disagree with ICANN compliance’s position on this matter, the actions we are taking are necessary to ensure that we are not offside with ICANN compliance in any way. We understand that you have been caught in the middle of this issue due to no fault of your own. Given these circumstances, we are offering you two options:

1) Should you decide to complete this transaction, we will issue you a payment of 10% of the purchase price after the transaction closes in 60 days, assuming the name is not registered by a TMCH mark holder because of the delay.

2) At any time during the 60 day period you have the option to rescind the auction bid and not purchasing the domain.