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ICANN 50% renewal predictions not based on registry data

Kevin Murphy, March 25, 2015, Domain Registries

ICANN’s projection that new gTLDs will see renewals of between 25% and 50% is not based on empirical data from new gTLD registries.

The predictions, which come in under industry standard expectations, are “conservative and somewhat subjective”, ICANN said.

The organization last week revealed that its 2016 budget is partly based on a high estimate of 50% renewals, with 25% for registries that gave their domains away for free.

Because ICANN would have been in possession of actual registry transaction reports for February at the time of publication, I wondered whether the 50% number was anchored in early new gTLD registries’ actual experience.

Transaction reports give the actual number of renewals each registry gets in any given month.

But ICANN told DI today that its 2016 budget was “produced in November 2014 and reviewed in January 2015 by the GDD Domain Name Services team.”

An ICANN spokesperson said:

These projections are strictly for revenue planning, so they are rather conservative and somewhat subjective. We have limited historical data to refer to when examining new gTLD domain name renewals; these are uncharted waters.

As renewals occur, we will be in a better position to refine our assumptions when and if the actual data varies widely from what we have assumed in our model.

Donuts’ current renewal number, revealed as part of a blog series, is 71%. It has not yet stabilized.

Does Chehade agree with Donuts on .doctor?

Kevin Murphy, March 24, 2015, Domain Policy

Should governments have the right to force business-limiting restrictions on new gTLD operators, even though they don’t have the same rules in their own ccTLDs?

ICANN CEO Fadi Chehade evidently believes the answer to that question is “No”, but it’s what ICANN is controversially imposing on Donuts and two other .doctor applicants anyway.

Donuts recently filed a Request for Reconsideration appeal with ICANN over its decision to make the .doctor gTLD restricted to medical professionals only.

It was an unprecedented “Public Interest Commitment” demanded by ICANN staff in order to keep the Governmental Advisory Committee happy.

The GAC has been asking for almost two years for so-called “Category 1″ gTLD strings — which could be seen to represent highly regulated sectors such as law or medicine — to see a commensurate amount of regulation from ICANN.

Governments wanted, for example, registrants to show professional credentials before being able to register a name.

In the vast majority of instances, ICANN creatively reinterpreted this advice to require registrants to merely assert that they possess such credentials.

These rules were put in registries’ contracts via PICs.

But for some reason in February the organization told Donuts that .doctor domains must be “ascribed exclusively to legitimate medical practitioners.”

According to Donuts, this came out of the blue, is completely unnecessary, an example of ICANN staff making up policy on the spot.

Donuts wants to be able to to sell .doctor names to doctors of any discipline, not just medical doctors. It also wants people to be able to use the names creatively, such as “computer.doctor” or “skateboard.doctor”.

What makes ICANN’s decision especially confusing is that CEO Fadi Chehade had the previous day passionately leaped to the defense of new gTLD registries in their fight against unnecessary GAC-imposed red tape.

The following video, in which Chehade uses .dentist as an example of a string that should not be subject to even more oversight, was taken February 11 at a Q&A with the Domain Name Assocation.

The New gTLD Program Committee meeting that authorized ICANN staff to add the new PIC took place February 12, the very next day. Chehade did not attend.

It’s quite remarkable how in line with registries Chehade seems to be.

It cuts to the heart of what many believe is wrong with the GAC — that governments demand of ICANN policies that they haven’t even bothered to implement in their own countries, just because it’s much easier to lean on ICANN than to pass regulations at home.

Here’s the entire text of his answer. He’s describing conversations he’d had with GAC members earlier in the week.

They’re saying stop all the Category 1 TLDs. Stop them. Freeze them!

And we said: Why do we need to freeze them? What’s the issue?

They said: It’s going to harm consumers.

How will it harm consumers? We started having a debate.

It turns out that they’re worried that if somebody got fadi.casino or fadi.dentist, to pick one of Statton’s [Statton Hammock, VP at Rightside, who was present], that this person is not a dentist and will pluck your ear instead of your teeth. How do you make sure they’re a dentist?

So I asked the European Commission: How do you make sure dentist.eu is a dentist?

They said: We don’t. They just get it.

I said: Okay, so why do these guys [new gTLD registries] have to do anything different?

And they said: The new gTLD program should be better or a model…

I said: Come on guys, do not apply rules that you’re not using today to these new folks simply because it’s easy, because you can come and raise flags here at ICANN. Let’s be fair. How do you do it at EU?

“Well, if somebody reports that fadi.dentist.eu is not a dentist, we remove them.”

Statton said: We do the same thing. It’s in our PICs. If fadi.dentist is not, and somebody reports them…

They said: But we can’t call compliance.

You can call compliance. Anyone can call compliance. Call us and we’ll follow up. With Statton, with the registrar.

What we have here is Chehade making a passionate case for the domain name industry’s right to sell medical-themed domain names without undue regulation — using many of the same arguments that Donuts is using in its Reconsideration appeal — then failing to show up for a board meeting the next day when that specific issue was addressed.

It’s impossible to know whether the NGPC would have reached a different decision had Chehade been at the February 12 meeting, because no formal vote was taken.

Rather, the committee merely passed along its “sense” that ICANN staff should carrying on what it was doing with regards implementing GAC advice on Category 1 strings.

While Chehade is but one voice on the NGPC, as CEO he is in charge of the ICANN staff, so one would imagine the decision to add the unprecedented new PIC to the .doctor contract falls into his area of responsibility.

That makes it all the more baffling that Donuts, and the other .doctor new gTLD applicants, are faced with this unique demand to restrict their registrant base to one subset of potential customers.

All eyes on Donuts as first new gTLD renewal figures roll in

Kevin Murphy, March 23, 2015, Domain Registries

Donuts is about to give the world the clearest picture yet of the ongoing demand for new gTLD domain names.

The company has taken the unprecedented decision to disclose its renewal figures on a pretty much live basis.

COO Richard Tindal has been blogging renewal stats for .bike, .clothing, .guru, .ventures, .holdings, .plumbing and .singles for the last few days.

Those were the first seven of its gTLDs to hit general availability.

To Saturday, the renewal status of 6,352 names in these gTLDs was known and the renewal rate was 85.3%.

However, that rate is boosted by the relatively high proportion of the names that were registered during sunrise periods.

Donuts said that “two thirds” of the 6,352 reported domains were registered after sunrise.

That doesn’t make a whole lot of sense to me, given that Donuts has previously put the total number of sunrise regs across the seven TLDs at just 1,404, which would work out at about 22%, not 33%.

On Friday, the company had said that the status of 4,534 names was known and the renewal rate was 91.6%.

If you deduct the Friday numbers from the Saturday numbers, you get to 1,265 renewals and 553 drops, a renewal rate of almost 69.6% for that particular day.

That number, which is a few percentage points off what a gTLD such as .com regularly reports, could of course fluctuate.

The full-year renewal rate, which would factor out much of the domainer activity, of course won’t be known for another year.

Donuts said it expects its renewal rate to drop to the mid-70s in its next daily report, expected today, which will cover an additional 22,910 domains.

The company’s decision to blog its numbers comes a day or two after we reported that ICANN is only budgeting for renewals of 50%.

The 14.6% of names not renewed works out to about 933 domains.

“We believe most of those names will be re-registered by another party within the next 35 days,” Tindal wrote.

As they were all registered in the early days of GA, one might expect them to be of a reasonably high quality.

While GA began at the end of January 2014, renewal rates are not known until the Auto-Renew Grace Period, which can be as long as 45 days, has expired.

Donuts launches first “not com” ad campaign

Kevin Murphy, March 17, 2015, Domain Registries

Donuts has launched its first ad campaign, part of its plan to raise awareness about new gTLDs as a category.

It’s a digital-only video campaign, expected to run on sites including YouTube, the New York Times, Forbes, Mashable and Fast Company.

The theme is “freedom of choice”, using the slogan “Welcome to the not com revolution”.

“It’s going to be a lot of digital, a lot of online marketing, and it’s going to be about choice and the fact that this new product category represents an opportunity to grab an identity on the internet, that really reflects what it is you are and what you do,” COO Richard Tindal told DI in a recent interview.

The ad campaign going to be US-only, which chimes with what Tindal said as he laid out some of Donuts’ vision and marketing plans for 2015.

“I think that level of awareness is very low at sort of five to ten percent,” he said in the January interview. “It varies from country to country. Probably in the US it is even a little lower than other places.”

Tindal told us that Donuts is primarily concerned with marketing the “category” of new gTLDs, rather than any specific TLD.

“Our mission in 2015 is to have those people be aware of the category before they turn up at the registrar,” he said. “They are still going to get the story from the registrar, but we want them to know all about this new thing before they turn up.”

Donuts says that the new ad campaign will drive traffic to Your.domains.

That domain actually redirects to Domainr — a sparse, but quite smart, name-spinner app developed by the little-known nb.io.

That site, which appears to be monetized with affiliate links, quickly presents relevant domains based on user keywords and sends leads to a selection of registrars.

Such “smart search” is an important part of Donuts’ strategy, but one where the new gTLD industry as a whole is failing to make much of an impact at the moment.

Here in the UK, it’s pretty obvious from Go Daddy’s advertising that the market-leading registrar would sooner take the Verisign shilling and plug .com rather than risk promoting the largest expansion of inventory in its history.

Tindal said in our interview that Donuts’ aim in 2015 is to promote smart search over paid placement.

Asked whether registrars’ economic interests are aligned with new gTLD registries’, he said he’s convinced that for all the domains sold in 2014, new gTLDs have better metrics for registrars than .com. The only problem is volume.

If you look at the metrics of those .com names, under every criteria the registrar is better off selling one of ours.

The customer finds a name more quickly. It’s got more margin for the registrar, because they’re better quality names. They’re going to buy more. The problem, as you’ve just noted is of course just the volume. At the moment, there’s so much volume for them in .com that they tend to stick to that, and so we’re seeing the sort of behaviors, if you like, that are sort of clouding what we would like to see.

Awareness-raising is important, therefore, to get customers actively looking for more relevant domains, rather than being served up .com by default at registrars unwilling to take a risk on new TLDs.

Donuts’ announcement can be found here.

The full interview with Tindal, which also covers topics such as SEO and dot-brands, can be read by DI PRO subscribers here.

Donuts bought .reise

Donuts has been confirmed by a German news site as the new owner of .reise, which was auctioned by its previous owner last week.

It was the first time a live gTLD had been sold at auction.

The deal, which is believed to have cost Donuts at least $400,000, means the company now owns .reise and .reisen.

Both mean “.travel”. According to my GCSE German skillz, last exercised 22 years ago, .reisen is a verb and .reise is a noun, but .reisen is also the plural of the noun .reise.

I believe this means that Donuts is the first company to own both the plural and singular forms of a new gTLD string.

Heise Online reports that former registry Dotreise was forced to sell up due to competition from Donuts.

Donuts’ .reisen has over 4,000 names in its zone file, compared to .reise’s 1,300. It’s a small market so far, but Donuts has the lion’s share.

The article notes that Donuts got a better position in ICANN’s prioritization draw in late 2012, meaning it got to market slightly earlier. Donuts also sells for a much lower price.

I doubt time to market was as much of a factor as price.

But it might be interesting to note that while Donuts’ advantage was just six days in terms of contract-signing, that lead had been extended to six weeks by the time .reise was delegated.

Donuts, which has more experience than any other company when it comes to the transition to delegation process, managed to hit general availability two weeks sooner than .reise, even though Donuts’ sunrise period was twice as long.