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ICANN slashes new gTLD income forecast AGAIN

Kevin Murphy, May 23, 2018, Domain Policy

ICANN has yet again been forced to lower its funding expectations from new gTLDs, as the industry continues to face growth challenges.

In its latest draft fiscal year 2019 budget, likely to be approved at the end of the month, it’s cut $1.7 million from the amount it expects to receive in new gTLD transaction fees.

That’s even after cutting its estimates for fiscal 2018 in half just a few months back.

New gTLD registry transaction fees — the $0.25 collected whenever a new gTLD domain is registered, renewed or transferred, provided that the gTLD has over 50,000 domains under management — are now estimated at $5.1 million for FY19

That’s up just $500,000 from where it expects FY18, which ends June 30 this year, to finish off.

But it’s down $900,000 or 15% from the $6 million in transaction fees it was forecasting just four months ago.

It’s also still a huge way off the $8.7 million ICANN had predicted for FY18 in March 2017.

Registrar new gTLD transaction fees for FY19, paid by registrars regardless of the size of the TLD, are now estimated to come in at $4.3 million, up $400,000 from the expect FY18 year-end sum.

But, again, that number is down $800,000 from the $5.1 million in registrar fees that ICANN was forecasting in its first-draft FY19 budget.

In short, even when it was slashing its FY18 expectations in half, it was still over-confident on FY19.

On the bright side, at least ICANN is predicting some growth in new gTLD transactions.

And the story is almost exactly reversed when it comes to pre-2012 gTLDs.

For legacy gTLD registry transaction fees — the majority of which are paid by Verisign for .com and .net — ICANN has upped its expectations for FY19 to $49.6 million, compared to its January estimate of $48.7 million (another $900,000 difference, but in the opposite direction).

That growth will be offset by lower growth at the registrar level, where transaction fees for legacy gTLDs are now expected to be $30.2 million for FY19, compared to its January estimate of $30.4 million, a $200,000 deficit.

None of ICANN’s estimates for FY18 transaction fees have changed since the previous budget draft.

But ICANN has also slashed its expectation in terms of fixed fees from new gTLD registries — the $25,000 a year they all must pay regardless of volume.

The org now expects to end FY18 with 1,218 registries paying fees and for that to creep up slightly to 1,221 by the end of FY19.

Back in January, it was hoping to have 1,228 and 1,231 at those milestones respectively.

Basically, it’s decided that 10 TLDs it expected to start paying fees this year actually won’t, and that they won’t next year either. These fixed fees kick in when TLDs are delegated and stop when the contract is terminated.

It now expects registry fixed fees (legacy and new) of $30.5 million for FY19, down from expected $30.6 million for FY18 and and down from its January prediction of $31.1 million.

ICANN’s budget documents can be downloaded here.

ICANN board talking GDPR “litigation”

Kevin Murphy, May 21, 2018, Domain Policy

ICANN’s board of directors is meeting today to discuss its “litigation strategy” concerning the General Data Protection Regulation, the EU privacy legislation due to make Whois unrecognizable come Friday.

Those two words are basically the only item on its agenda for a special board meeting today.

I’ve been unable to squeeze any further information out of ICANN, but I can speculate about a few different things it could mean.

The first thing that springs to mind is a blog post by CEO Goran Marby dated April 12, in which he wrote:

Without a moratorium on enforcement, WHOIS will become fragmented and we must take steps to mitigate this issue. As such, we are studying all available remedies, including legal action in Europe to clarify our ability to continue to properly coordinate this important global information resource. We will provide more information in the coming days.

To my knowledge, no additional information on this “legal action in Europe” has ever been released.

Could ICANN be ready to take a data protection authority to court preemptively, as a test case to insulate the industry against enforcement action from DPAs? Your guess is as good as mine at this stage.

Another possibility, still in speculative territory, is that the board will be discussing the many calls from the industry for some kind of legal or financial indemnification against GDPR-related regulatory actions. I’d assign a relatively low probability to that idea.

A third notion that springs to mind, slightly more realistically, is that the board could simply be discussing how ICANN would defend itself from incoming litigation related to its GDPR response.

It usually takes ICANN a few days to post the results of its board meetings, but on important hot topics it’s not hugely unusual to see same-day publication.

Failure to launch: 10 years-old gTLDs that are still dormant

Over six years after the last new gTLD application window closed, more than one in 10 new gTLDs have yet to launch, even though some have been delegated for over four years.

Once you filter out duplicates, withdrawals and terminations from the original 1,930 applications, there were a maximum of roughly 1,300 potential new gTLDs from the 2012 round.

But, by my calculations, 144 of those have yet to even get around to their sunrise period. Most of those haven’t even filed their launch plans with ICANN yet.

Here’s 10 from that list I’ve picked based on how interesting they appear to me, in no particular order.

Yes, DI is doing listicles now. Hate-mail to the usual address.

.forum

This one’s owned by Jay Westerdal’s Top Level Spectrum, the same company behind .feedback, .realty and others. I quite like the potential of this string — the internet is chock-full of forums due to the easy availability of open-source forum software — but so far nobody’s gotten to register one. It was delegated back in June 2015 and doesn’t have a published launch plan as yet. An FAQ reading just saying “Jay was here !!!!! Test deploy..delete me later…” has been up on its site since at least last September. TLS is also sitting on .contact and .pid (for “personal ID”) with no launch dates in sight.

.scholarships

Owned by Scholarships.com, there’s a whiff of the defensive about this one. It’s been in the root since March 2015 but its site states the registry “is still finishing launch plans and will provide updates as they become available”. Scholarships.com is a site that connects would-be higher education students to potential sources of funding. It’s difficult to imagine many ways the matching gTLD could possibly help in that mission.

.giving

JustGiving, the UK-based charity campaign aggregator, won this gTLD and had it delegated in August 2015, but seemingly still hasn’t figured out what it wants to do with it. It’s not a dot-brand, so it’s presumably mulling over ways to give .giving domains to fundraisers in a way that does not compromise credibility. Whatever its plans, it’s taking its sweet time over them.

.cancerresearch

This is a weird one. Delegated four years ago, the Australian Cancer Research Foundation rather quickly went live with a bunch of interlinked .cancerresearch web sites, using its contractually permitted allotment of promotional domains. Contractually, it’s not a dot-brand, but it’s basically acting like one, having never actually given ICANN any info about sunrise, eligibility, trademark claims, general availability, etc. Technically, it’s still pre-launch, and I can’t see any reason why it would want to budge from that status. Huge loophole in the ICANN rules?

.beauty

Another whiff of gaming here. International woman-shaming powerhouse L’Oreal still has no announced plans to launch .beauty, .skin or .hair, which it had originally wanted to run as so-called “closed generics” (presumably to keep the keywords out of the hands of competitors). Of its small portfolio of generic gTLDs, delegated in 2016, it has actually launched .makeup already, with a $6,000 retail price and a strategy seemingly based on registry-owned domains matching the names of makeup-focused social media influencers. At least it’s actually selling names, even if nobody’s bought one yet.

.budapest

One of three city TLDs that were delegated back in 2014 but have yet to start selling domains. MMX is to run it in partnership with the local government of the Hungarian city, if it ever gets off the ground. Madrid (.madrid) and Zurich (.zuerich) have both also yet to roll out, although Zurich has settled on early 2019 for its launch.

.fan

Regular DI readers won’t be surprised to see this one on the list. In what may turn out to be a shocking waste of money, .fans registry Asiamix Digital acquired the singular .fan from Donuts back in 2015 and promptly let it sit idle for the next three years. Currently, with .fans turning out to be a flop, Asiamix has money troubles and I wouldn’t be surprised to see it under new ownership before too long. It’s not a terrible string, so there’s some potential there.

.ком, etc

.ком is one of 11 internationalized domain name transliterations of .com — .कॉम, .ком, .点看, .คอม, .नेट, .닷컴, .大拿, .닷넷, .コム, .كوم and .קוֹם — that Verisign had delegated back in 2015. To date, only the Japanese .コム has launched, and the registry reportedly arsed it up quite badly. Records show .コム peaked at over 28,000 names and sits at fewer than 7,000 today. None of the remaining IDNs have launch dates attached.

Anything owned by Google or Amazon

When it comes to sitting on dormant gTLDs, you can’t top Google and Amazon for sheer numbers. Google has 19 strings in pre-launch states right now, while Amazon has a whopping 34. Amazon is letting the likes of .free, .wow, .now, .deal, .save and .secure sit idle, while Google is still stroking its chin on the likes of .eat, .meme, .fly and .channel. At the snail’s pace these companies roll out gTLDs, I wouldn’t be surprised if some of these strings never hit the market.

.bom

Portuguese for “.good”, .bom was delegated to local ccTLD registry Nic.br in 2015 but has no published launch dates and no content on its nic.bom registry web site. I’d say more, but I expect a certain prolific DI commenter could do a better job of it, so I’ll turn it over to him

Donuts freezes .place gTLD ahead of new geofencing rules

Donuts has taken its .place gTLD temporarily off the market as it repurposes the space as a restricted zone for “geofencing” related uses.

That’s right, the biggest gTLD portfolio play and historically staunch advocate of open gTLDs is actually planning to introduce eligibility requirements into a currently unrestricted TLD.

Details are light ahead of a formal announcement, but I’m told all new .place registrants will have to agree to use their domains for geofencing purposes.

This looks a bit like it could be a taste of the “innovation” we were all promised from the new gTLD program.

Geofencing refers to systems that divide the world up into fenced-off virtual parcels of land based on GPS coordinates, enabling location-based services.

It’s an area Donuts has been looking at for a while, having invested in early-stage geofencing company GeoFrenzy, since rebranded as Geo.Network, two years ago.

While Donuts puts its new .place model in place — ICANN and registrars have been given the heads-up — it should not be possible to register any new .place domains.

Major registrars such as GoDaddy, Namecheap, Uniregistry and Donuts-owned Name.com were not returning results for .place domains on their storefronts when I checked over the weekend.

Other registrars did still appear to be offering the names, but I did not attempt to register one to check whether the sale would complete.

I gather that the new eligibility requirements will not apply retroactively, so anyone who currently owns a .place name will get to keep it on an unrestricted basis.

There are around 7,000 active .place domains currently.

Registrars want six-month stay on new Whois policy

Registrars representing the majority of the gTLD industry want ICANN to withhold the ban hammer for six months on its new temporary Whois policy.

As I reported earlier today, ICANN has formally approved an unprecedented Temporary Policy that seeks to bring the Whois provisions of its contracts into compliance with the EU’s General Data Protection Regulation.

It comes into effect next Friday, May 25, but it contains a fair few items that will likely take longer for registrars to implement.

While ICANN’s top lawyer has indicated that ICANN Compliance will act as reasonably as possible about enforcing the new policy, registrars want a moratorium of at least six months.

In a letter (pdf) dated May 16 (before the policy was voted through, but while its contents were broadly known), Registrar Stakeholder Group chair Graeme Bunton wrote:

Any temporary specification adopted now that significantly deviates from previously held expectations and models will be far too late for us to accommodate for a May 25, 2018 implementation date.

For this reason, we ask that any temporary specification include a formal ICANN compliance moratorium, not shorter than six (6) months, providing us an opportunity to conform, to the extent possible, our GDPR implementation with the GDPR-compliant aspects of any ICANN temporary specification

He added that some registrars may need even more time, so they should have the right ask for an extension if necessary.

The letter is signed by Endurance, GoDaddy, Tucows, Blacknight, 1&1, United Domains, NetEarth One and Cloudflare, which together account for most gTLD domains.