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New gTLDs slip again in Q1

The number of domains registered in new gTLDs slipped again in the first quarter, but it was not as bad as it could have been.

Verisign’s latest Domain Name Industry Brief, out today, reports that new gTLD domains dropped by 800,000 sequentially to end March at a round 23.0 million.

It could have been worse.

New gTLD regs in Q1 were actually up compared to the same period last year, by 2.8 million.

That’s despite the fact that GRS Domains, the old Famous Four portfolio, has lost about three million domains since last August.

Verisign’s own .com was up sequentially by two million domains and at 141 million, up by 7.1 million compared to Q1 2018. But .net’s decline continued. It was down from 14 million in December to 13.8 million in March.

Here’s a chart (click to enlarge) that may help visualize the respective growth of new gTLDs and .com over the last three years. The Y axes are in the millions of domains.

.com v new gs

New gTLDs have shrunk sequentially in six of the last 12 quarters, while .com has grown in all but two.

The ccTLD world, despite the woes reported by many European registries, was the strongest growth segment. It was up by 2.5 million sequentially and 10 million compared to a year ago to finish the period with 156.8 million.

But once you factor out .tk, the free TLD that does not delete expired or abusive names, ccTLDs were up by 1.4 million sequentially and 7.8 million on last year.

GRS has lost three million domains since Famous Four died

The old Famous Four Media gTLD portfolio has shrunk by roughly 60% since old management were kicked out.

At the same time, the new registry is selling less than one percent of the domains it used to add each month.

The 16 TLDs, now managed by GRS Domains, have a total of approximately 2 million domains in their zone files today, compared to about 5 million at the end of August 2018.

Last August was when GRS, which seems to have taken over the portfolio about a year ago, announced that it was introducing “much more transparent and sensible pricing strategy” of $9.98 per domain per year across the board.

Its 16 TLDs include the likes of .loan, .win and .bid. Many had been offered in the sub-$1 range, largely via former affiliate AlpNames, attracting huge volumes of registrations but low renewals and a lot of spammers.

I compared the zone file counts at the end of August 2018 to yesterday’s numbers, rounding to the nearest thousand, and came up with this:

TLDThenNowChangeChange (%)
TOTAL5,092,0002,010,000-3,082,000-60.53
accountant64,00022,000-42,000-65.63
bid318,000104,000-214,000-67.30
cricket26,0008,000-18,000-69.23
date155,00061,000-94,000-60.65
download146,00046,000-100,000-68.49
faith62,00021,000-41,000-66.13
loan2,200,000990,000-1,210,000-55.00
men421,000144,000-277,000-65.80
party122,00044,000-78,000-63.93
racing81,00033,000-48,000-59.26
review260,00060,000-200,000-76.92
science95,00039,000-56,000-58.95
stream319,000130,000-189,000-59.25
trade182,00068,000-114,000-62.64
webcam60,00027,000-33,000-55.00
win581,000213,000-368,000-63.34

Don’t think for a second that the correction is over. The story of the old FFM portfolio’s decline will roll for many more months. Each TLD is still seeing monthly deletes in the thousands.

The number of new regs across the portfolio every month has dropped off a cliff — a big cliff with jagged rocks and sharks circling at the bottom — since the August price changes.

Whereas in January 2018 the 16 gTLDs saw a combined total of over 400,000 adds, by January 2019 this had dropped to fewer than 1,700, a 99.59% decline.

TLDAdds Jan 18Adds Jan 19ChangeChange (%)
TOTAL400,6921,645-399,047-99.59
accountant6,58222-6,560-99.67
bid2225871-22,187-99.68
cricket3,35713-3,344-99.61
date11,27823-11,255-99.80
download12,83030-12,800-99.77
faith4,44031-4,409-99.30
loan20649936-206,463-99.98
men23,98853-23,935-99.78
party16,862143-16,719-99.15
racing4,27135-4,236-99.18
review16,95649-16,907-99.71
science9,501101-9,400-98.94
stream19,655101-19,554-99.49
trade12,300123-12,177-99.00
webcam5,54127-5,514-99.51
win24,374787-23,587-96.77

In each case, the drop-off in adds started in August last year. Each TLD went almost immediately from thousands of new regs per month, to under 100.

I compared Januaries because January 2019 is the date of the most-recent registry transaction data. January 2018 was not an atypically strong month for sales for any of the TLDs; for many, it was on the slow side.

Famous Four was replaced by GRS about a year ago after investors in Domain Venture Partners, the ultimate owner of the portfolio, fell out with FFM management.

The registrar AlpNames, which was responsible for a huge share of FFM’s sales and was managed by the same people, has also since gone out of business.

Defunct Famous Four ordered to hand $1.5 million back to investors

Former domain registry manager Famous Four Media has been ordered to return money to investors that was being used as insurance against its portfolio of gTLDs going out of business.

In an April 18 ruling (pdf) from Gibraltar’s Supreme Court, FFM and its CEO Iain Roache are told that original investors Domain Venture Partners are the true owners what looks to be about $1.5 million being used to back letters of credit in ICANN’s name.

It’s a very complicated ruling, reflecting the complex structure of the FFM/DVP relationship. It wants for clarity in some areas, and is probably best suited to interpretation by a forensic accountant.

Nevertheless, I’ll give it a shot.

Basically, back in 2011 businessman Iain Roache recruited a bunch of international investors to join him in funding applications for 60 new gTLDs. The investment vehicle was and is called Domain Venture Partners.

Each application had an associated “bid vehicle”, essentially a Gibraltar-based shell company with names along the lines of Dot Science Ltd or Dot Accountant Ltd.

Those of the vehicles that were successful in their applications continue to be the official registry sponsors for 16 active gTLDs. They’re all owned by DVP.

Famous Four was a separate company, owned 80:20 by Roache and business partner Geir Rasmussen, hired by DVP to manage the business of actually selling domains.

For many years, myself and pretty much everybody else covering the domain name industry referred to FFM as if it was the owner of the TLDs, more or less interchangeably with DVP.

In fact, FFM was just a DVP contractor and behind the scenes DVP was growing increasingly unhappy with how the domains were being managed, DVP investor Robert Maroney told DI last August.

For about a year now, FFM has been in liquidation. DVP kicked it out of the registry management business and replaced it with a new company that it controls called GRS Domains, managed by a PricewaterhouseCoopers accountant called Edgar Lavarello.

Thirteen of the DVP bid vehicles sued Famous Four to claim ownership of, among other things, the money backing the so-called “Continuing Operations Instruments” that ICANN demanded from each new gTLD applicant.

The COI, usually a letter of credit from a big bank, were used to give ICANN the confidence that new gTLD domain registrants would not be affected by dodgy registries going out of business and their domains immediately going dark. The money would fund ongoing technical operations for a few years, giving registrants time to find a new home for their web sites.

In this case, Famous Four’s liquidator refused to agree that the money backing the COIs was rightfully DVP’s.

What seems to have happened is that in mid-2016 the DVP letters of credit were hastily switched from Credit Suisse to Barclays, after Credit Suisse closed down its Gibraltar branch.

There was a period in which both sets of LoCs were active, in order to remain compliant with ICANN’s rule that there must be an active COI at all times.

The original Credit Suisse LoCs had been funded by DVP, but the Barclays LoCs were funded by FFM, or quite possibly Roache himself, to the tune of about $1.5 million.

FFM was then repaid by the return of the money backing the Credit Suisse LoCs, when those LoCs were closed, according to Chief Justice Anthony Dudley’s ruling.

After the switch of banks, the LoCs were no longer in the names of the DVP bid vehicles; they belonged to FFM. The money DVP put up to originally secure the COIs was now in FFM’s control.

Dudley now seems to have ruled that FFM now owes DVP this money back, and that the liquidator, Grant Jones of Simmons Gainsford, was wrong to withhold it.

In fact, the judge has some quite stern words for Jones, saying that he was “wholly inappropriate” when he temporarily turned over his responsibilities as liquidator to Roache and his law firm. Dudley wrote:

It may be that it arises as a consequence of the Liquidator having limited funds with which to engage in litigation. But whatever the reason, the position adopted by the liquidator of FFM in these proceedings has been unusual and certainly capable of being construed as running counter to the fundamental principle of objectivity required of a Liquidator, now codified in the Insolvency Practitioner Regulations 2014. Rather than formulate his own view (or as urged by me at a preliminary hearing seek his own independent legal advice) by letter dated 1 March 2019 GJ sought to abrogate his responsibility and authorised IR and JSF to act on behalf of FFM

That aside, the main piece of evidence that appears to have caused Dudley to side with DVP was a set of emails from Famous Four chief legal officer Oliver Smith to DVP investors that were sent at the time the LoCs were switching banks.

Smith confirmed in one of these emails that FFM was basically just acting as a conduit for DVPs bid vehicles, which by that point were operational registries.

The judge noted that the Smith email that confirmed this was submitted in evidence by Lavarello and Maroney only after Roache had submitted the rest of the thread, excluding this email, in his own evidence.

Dudley ruled that the DVP companies should get what they asked for, namely the funds associated with the LoCs. It’s not entirely clear from his ruling how much this is, but by my reading it’s around the $1.5 million mark.

The liquidation, which is ongoing, is to the best of my knowledge unrelated to the still unexplained demise of AlpNames, the registrar and close FFM partner also owned by Roache and Rasmussen.

Finally, a disclaimer.

Because I’ve already had one spurious legal threat related to my ongoing coverage of Famous Four’s demise, and don’t really need the arseache of any more, I’m going to state unequivocally for the record that I’m not alleging any wrongdoing by anyone.

If I’ve got anything wrong, as always I will gladly issue a correction. Just ask, and show your working. No need to sic the lawyers on me.

You can read the judge’s decision (pdf) and decide for yourself what’s been going on.

Rumors swirl as AlpNames suffers “days” of downtime

Kevin Murphy, March 12, 2019, Domain Registrars

The web site of controversial registrar AlpNames has been offline for “days”, and rumors have started to circulate that it might not just a technical problem.

At time of writing, alpnames.com resolves to a Cloudflare error page, warning that the AlpNames web server has an invalid SSL certificate. Cloudflare may also show an ugly, bare-bones cached version of the site.

This means that AlpNames customers are unable to log in to manage their domains, according to threads on Namepros and Reddit, and conversations I’ve had with some of those affected.

It’s said that customers are able to manage their domains by logging in directly to LogicBoxes, AlpNames’ registrar-in-a-box provider, but I’ve been unable to personally verify this.

AlpNames is believed to have almost 700,000 names under management, double the size it was last June but well below its peak, at the height of its deep-discounting period in 2017, of over three million.

It’s not known how many individual registrants are affected. The company tends to attract what one might charitably call “bulk-buyers”, so it will be substantially lower than the number of registered domains.

It’s also not entirely clear when the web site went down. It’s not been loading here for at least 12 hours, but the first reference to downtime on Namepros was on Sunday. Multiple other sources have told me today that it’s been unavailable “for a few days”.

A separate AlpNames-owned web site focused on marketing .icu domains to the Chinese market is still online.

But it seems a lot of AlpNames customers have been left hanging in uncertainty, unsure how or when they will be able to manage their domains.

I’ve been unable to reach any of AlpNames’ senior executives for comment on the situation today.

An email sent to CEO Iain Roache this morning, at the address he was using in December, bounced back with a “disabled account” error message. I have received no response to messages I sent to two other email addresses he is known to use.

I understand that fellow AlpNames exec Geir Rasmussen who, with Roache, was enthusiastically pitching grand plans for AlpNames as recently as October, is no longer with the company.

Chief operating officer Damon Barnard also left the company last October and ceased work as a director around the same time.

Records show the salesperson due to represent AlpNames at this week’s ICANN 64 meeting in Japan did not show up and is believed to have also left the company in January.

The company’s Twitter and Facebook accounts, which are not usually particularly active anyway, have not yet addressed the downtime problem.

If it is simply a case of an expired or misconfigured SSL cert, why is it taking so long to fix, and why has there been radio silence from AlpNames?

Opponents and competitors are putting the word around that there may be a more serious problem with the company, but I’ve not seen any conclusive evidence that this is the case.

It’s possible there’s some confusion between AlpNames and Famous Four Media, the now-defunct Roache/Rasmussen venture that managed the portfolio of new gTLDs owned by Domain Venture Partners, an investment vehicle set up by Roache prior to ICANN’s 2012 gTLD application round.

DVP is no longer affiliated with AlpNames and its gTLDs are managed by a new DVP-controlled entity, GRS Domains, after an investor revolt.

The most-read stories of 2018

Kevin Murphy, January 3, 2019, Domain Services

Happy 2019!

As we crawl, dark-eyed and slurring, from our festive hibernation, I thought now would be a good time to do a quick reminder of 2018, in the form of a top-10 list of the most-read stories published by DI over the last 12 months.

If not today, then when?

I’ve excluded, as usual, articles that seem to show up prominently in my traffic logs every single day simply because Google seems to think they’ve got porn in them.

Stéphane Van Gelder dies after motorcycle accident

Stéphane Van Gelder was a registrar industry pioneer and long-time ICANN community leader, and his untimely death in a vehicle accident in March came as a great shock to many. The fact that this post was the most-read of the year is not surprising. He is missed by many, and was subsequently posthumously awarded ICANN’s Multistakeholder Ethos Award.

Has the world’s biggest new gTLD registry gone bankrupt?

This speculative post from June came about after I discovered that a court-appointed administrator had taken over ownership of all TLDs in the Famous Four Media portfolio. It later turned out that FFM had in fact been removed by investors in true portfolio owner Domain Venture Partners, which created a new company, GRS Domains, to take over. The full details of this evidently bitter boardroom fight have yet to emerge.

Donuts freezes .place gTLD ahead of new geofencing rules

Perhaps a surprising entry on the list, this story detailed how Donuts had essentially taken .place off the market in preparation for a planned repurposing of the gTLD to tie into the emerging “geofencing” infrastructure. The freeze happened in May, and as far as I can tell .place is still in limbo as the technology back-end is finalized, which may account for this post’s popularity.

ICANN number two Atallah is new CEO of Donuts

Not long after Donuts was acquired by a private equity fund partly controlled by former ICANN CEO Fadi Chehade, I received a tip-off that his former number two, Global Domains Division president Akram Atallah, had been headhunted to be the registry’s new CEO. It was officially confirmed a few hours later, but not before the unwashed hordes (that’s you) had given the DI server something to think about. The perception of a revolving door between ICANN and industry raised eyebrows, including from the US government.

Google’s .app gTLD beats .porn to biggest sunrise yet

Google’s eagerly anticipated .app gTLD hit the market mid-year, and got off to a strong start with a sunrise period beaten only by defensive-heavy .porn. It’s very likely the strongest sunrise period of the 2012 round so far. The TLD has something like 350,000 domains under management today, which for new gTLDs is pretty much a success story.

GoDaddy and DomainTools scrap over Whois access

This story about GoDaddy and DomainTools fighting about whether the latter could get unmitigated access to the former’s Whois database was published in January, long before the full impact of GDPR on Whois privacy was known, and therefore now, with the benefit of hindsight, feels hopelessly naive.

How all 33 European ccTLDs are handling GDPR

Good grief, did I write a “listicle”? To mark the day GDPR came into full effect, I trawled through the web sites, news releases and policy documents of 33 European ccTLDs to see how each registry was planning to comply with the strict new privacy legislation, so you didn’t have to. The results were surprisingly diverse.

Google’s $25 million .app domain finally has a launch date

Remember how I said .app was “eagerly anticipated”? The fact that this post, merely noting the TLD’s launch timetable, hit the top 10 most-read stories for the year is perhaps proof of that.

Facebook clashes with registrars after massive private data request

Many big brands were unhappy with how ICANN and the industry turned off their unfettered Whois access following GDPR, none more so than Facebook, which has been piling pressure on ICANN to force registrars to acquiesce to its data requests. This July story revealed how it had started using a close intermediary called AppDetex to bombard registrars with over-broad disclosure requests. Registrars subsequently fought back, and AppDetex later gave me a demo of its early-stage software. The fight, no doubt, continues.

These 33 people will decide the future of Whois

Another GDPR listicle? In this July post I prepared brief bios of the volunteers selected to work on ICANN’s first Expedited Policy Development Process working group, which is challenged with coming up with a permanent policy solution to GDPR, amenable to all sections of the community. Needless to say, they’re still working on it…

That’s the top 10 most-read articles on DI in 2018. Honorable mentions go to Fight breaks out as Afilias eats Neustar’s Aussie baby, How a single Whois complaint got this registrar shitcanned and Some men at ICANN meetings really are assholes, simply because I like the headlines.

Happy new year to all DI readers. I don’t tell you this nearly regularly enough, but I really do love you all more than words could possibly describe.