.CLUB announces three years of price increases

.CLUB Domains is to increase its wholesale registry fees by $1.90 over the next three years.
The company announced that the increases for .club names will come on July 1 this year, next year, and in 2021.
The current price is $8.05 per domain per year. This will go up to $8.95, then $9.45, then $9.95.
They’re the first price changes .CLUB has implemented, other than discounts, since its launch in 2014.
The gTLD had almost 1.5 million names under management at the last public count, and has about 1.16 million names in its zone file today.
It saw a growth surge in the second half of 2018 due to aggressive discounting in China — with AliBaba selling new names for as little as $0.44 — which led to a corresponding increase in abuse.
.CLUB is a rare example of a private TLD operator that is fairly open about its financials.

.CLUB sees spam double after China promotion

.CLUB Domains has seen the amount of spam in .club double a month after seeing a huge registration spike prompted by a deep discount deal.
The registry saw its domains under management go up by about 200,000 names over a few days in early August, largely as a result of a promotion at Chinese registrar AliBaba.
AliBaba sold .club domains for CNY 3 ($0.44) during the promotion, helping it overtake GoDaddy as the top .club registrar.
At that time, spam tracker SpamHaus was reporting that 17.9% of the .club domains it was seeing in the wild were being used in spam.
Today, that number is 35.4%, almost double the August 7 level. SpamHaus does not publish the actual number of spammy domains for .club; that honor is only bestowed upon the top 10 “bad” TLDs.
Correlation does not equal causation, of course. There could be factors other than the AliBaba promotion that contributed to the increase, but I believe there’s probably a link here.
.CLUB chief marketing officer Jeff Sass told DI:

When registrars have domains “on sale”, there is always the chance that low-cost domains will be attractive to abusers. We monitor abuse proactively, and respond promptly to complaints, as well as monitor our registrar partners collectively and individually.

It’s almost certainly unfair of me to single out fluctuations in .club here, rather than take a comparative look at multiple TLDs. There are certainly many worse TLDs per SpamHaus’ statistics — .men leads among the gTLDs, with 87.2% spam.
But, given the industry truism that cheaper domains leads to more abuse, I think such a large increase correlating with such a successful promotion is a useful data point.

.CLUB revenue not all that

.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

.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.

.club is the bestest new gTLD, .club survey finds

.CLUB Domains has published the results of some research it commissioned into media mentions of new gTLDs that show .club coming out on top.
It’s an interesting new way to compare the relative success of new gTLDs based on usage or eyeballs rather than registration volumes, even if the report has its flaws.
In a blog post, .CLUB chief marketing officer Jeff Sass wrote:

A business will invest their time and money to incorporate a domain name that they trust and value. Their domain becomes an active component of their branding, marketing, and PR activities.
When the press or media picks up announcements and/or writes articles about these businesses, the domain name typically gets mentioned in the articles and press releases. This leads to further awareness, familiarity, and trust built around the domain name extensions that are mentioned most frequently in the press.

The registry paid Meltwater, a media monitoring company, to dig up all the media references to domains using any of the top 10 largest new gTLDs over the first half of the year.
It found that .club had the most mentions both empirically and adjusted for TLD size, and that .club’s media mentions had the most positive slant.
From the report (pdf):

When tracking the number of press impressions (articles) in terms of raw numbers, the top 3 were: .CLUB, with 14,519 impressions; .XYZ, with 10,770 impressions; and .ONLINE, with 9,595 impressions. When looking at the impression data against topline registration numbers, the top 3 TLDs were: .CLUB, with 13.29 impressions for every 1,000 registrations; .ONLINE, with 12.87 impressions for every 1,000 registrations; and .SITE, with 6.55 impressions for every 1,000 registrations. As for positive sentiment, the top 3 TLDs were: .CLUB, with 4,300 articles; .ONLINE, with 2,200 articles; and .XYZ with 2,189 articles.

The definition of “article” used by Meltwater is pretty broad. It’s certainly not looking at only the mainstream media.
The survey included press releases as well as editorial, and seems to include a fair bit of user-generated content, such as posts on Medium.com and Sohu.com, too.
There’s even one “article” cited that is actually just a Kickstarter crowd-funding project page.
The survey also double-counts articles, so if a press release appears on multiple sites, or an article is syndicated to multiple publications, each appearance was counted separately.
One could argue that all of this is a fair enough way to conduct such a survey — .CLUB is looking for evidence of grassroots usage and awareness, not just of coverage by publications with rigorous editorial controls.
And the methodology also called for all articles produced by or written about the registries themselves to be disregarded, presumably reducing the number of hits per registry and the chance of the results being gamed.
But a lot of the 30 articles cited directly in the Meltwater report, particularly those coming out of China, appear to be rather spammy. Others are just odd. Others offer negative views of specific new gTLD domains.
One of them is an inexplicable Chinese translation of a warning about a UK company using a .loan domain to scam people, for example.
Another is a BuzzFeed article from Japan about a fake news site using a .xyz domain to target Koreans.
Other references are so minor that even though Meltwater’s spiders spotted them I doubt many human beings would.
One of .club’s big hits is just a tiny photo credit on an stock image used in a forgettable BuzzFeed listicle, another is the Daily Mail quoting an Instagram post by an American athlete who uses a .club domain in a hashtag, the third is a self-promotional blog post on Medium.com by the owner of minicomic.club.
If these are the most prominent citations Meltwater could dig up over six months, these new gTLDs still have a way to go in terms of awareness.
But my main issue with the research is that it was limited to the top 10 new gTLDs by registration volume: .xyz, .top, .loan, .club, .win, .online, .vip, .wang, .site and .bid.
As we all know by now, there’s a correlation (at least anecdotally) between volume, low price and low quality usage/abuse.
I’d love to see subsequent reports of this nature delve into smaller TLDs, including dot-brands, that may not have as many sales but may have greater engagement and more press coverage.
The full .CLUB/Meltwater report can be found here (pdf).

CentralNic and .CLUB reveal premium sales

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

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

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

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.

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

.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

.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.