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Amazon sold rights to .box gTLD for $3 million

Kevin Murphy, October 27, 2020, Domain Registries

Amazon relinquished its rights to the .box gTLD five years ago for $3 million, according to court documents seen by DI.

Amazon was one of two applicants for .box, the other being a company called NS1 (that’s the numeral 1; this has nothing to do with Network Solutions).

According to a complaint filed a couple of years ago that I came across today, Amazon agreed to withdraw its application, giving its rival an unobstructed shot at the gTLD, for $3 million.

It was a private settlement of the contention set and the payout was not publicly revealed at the time.

A $3 million deal puts .box in the same ballpark as public auctions such as MMX’s .vip and Johnson & Johnson’s (now XYZ.com’s) .baby.

While the deal is years old, I thought the data point was worth publishing.

NS1’s application suggests that its business plan was to offer registrants cloud storage services, along the lines of DropBox.

But the ICANN contract was sold to Intercap, which also runs .inc and .dealer, earlier this year. The plan now appears to be to operate it as an open niche gTLD, but no launch dates have been announced.

It’s not known how much the gTLD sold for second time around.

Big pharma firm dumps its gTLD

Kevin Murphy, October 26, 2020, Domain Registries

Indian pharmaceuticals company Lupin has become the latest new gTLD registry to drop its dot-brand.

The firm told ICANN recently that it no longer wishes to continue running .lupin, which it has never actually used.

It’s the 82nd dot-brand to self-terminate, the 13th this year.

Lupin is one of the world’s largest manufacturer of generic medicines, with revenue in excess of $2 billion per year.

.web ruling might not come this year

Kevin Murphy, October 26, 2020, Domain Registries

A decision about who gets to run the .web gTLD may not arrive until early next year, according to Verisign CEO Jim Bidzos.

“A final decision from the [Independent Review Process[ panel may be issued later this year or early next year,” he told analysts late last week.

.web sold at auction for $135 million four years ago to a company being secretly bankrolled by Verisign, but the outcome is being challenged in the IRP by runner-up bidder Afilias.

Afilias argues that the auction should be voided because ICANN failed to sufficiently investigate links between Verisign and the winning bidder. ICANN denies any wrongdoing.

It’s widely believed that .web is the strongest potential competitor to Verisign’s .com, and its attempt to secure the string is largely defensive.

The IRP case heard several days of testimony in August and the panel retired to consider its decision.

ICANN may not meet again for a looong time

Kevin Murphy, October 21, 2020, Domain Policy

The grim reality of the ongoing coronavirus pandemic seems to be sinking in at ICANN.

Management and board all but confirmed yesterday that ICANN 70, currently still scheduled for Cancun, Mexico next March, will instead take place online via Zoom.

“We would all like to get back to face-to-face, but at this moment Cancun is not looking good for now,” chair Maarten Botterman said during a community discussion about meetings at ICANN 69, also online-only.

CEO Goran Marby said that there’s a “high probability” that Cancun will be virtual.

The session, “Board/Community Focus on ICANN Meetings” was notable for being extremely depressing rather than merely boring.

Several participants spoke in terms of ICANN meetings being virtual “for the foreseeable future”.

“With the world as it is right now, it’s very hard to say when we come back to full-fledged physical meetings,” CEO Göran Marby said.

He said there’s a possibility of “hybrid” meetings, where a face-to-face gathering could take place in a part of the world where the pandemic was under control, but he noted that this would put online participants at a disadvantage.

The overall vibe of the session was that things probably aren’t going to be back to “normal” for some time.

Even though coronavirus vaccines are already reportedly rolling off the presses right now and will be in the hands of governments by the start of 2021, many experts say the logistical problem of distributing vaccine widely enough to ensure herd immunity is tough enough that the “return to normal” is still a long way off.

Meeting participant Susan Anthony predicted that airline fares will be sky-high next year, limiting the ability of many would-be participants, particularly the smaller, less well-funded ones, to show up in person.

She said virtual or hybrid meetings could be around for “the indefinite future”.

Afilias director Jonathan Robinson concurred, saying “the world may have changed immeasurably and somewhat permanently”.

ICANN director Tripti Sinha later compared the post-pandemic world to the aftermath of the 9/11 terrorist attacks.

There was lots of talk about dumping 2020’s practice of holding the meetings during the time zone of the originally planned host country — the Hamburg time zone has been particularly tough on those in the Americas, who have to start their working day at about midnight — in favor of a utilitarian approach that is least inconvenient for the largest number of participants.

It seems to me that one reason that ICANN has yet to formally cancel Cancun — it’s not even on the board’s agenda this week — is that it’s toying with longer-term plan that may mean standard face-to-face ICANN meetings are a long way off indeed.

It’s difficult to believe that it was only June when some ICANN directors thought Hamburg would be sufficiently safe to return to face-to-face meetings this week.

ICANN denies Whois policy “failure” as Marby issues EU warning

Kevin Murphy, October 19, 2020, Domain Policy

ICANN directors have denied that recently delivered Whois policy recommendations represent a “failure” of the multistakeholder model.

You’ll recall that the GNSO Council last month approved a set of controversial recommendations, put forward by the community’s EPDP working group, to create a semi-centralized system for requesting access to private Whois data called SSAD.

The proposed policy still has to be ratified by the ICANN board of directors, but it’s not on the agenda for this week’s work-from-home ICANN 69 conference.

That has not stopped there being some robust discussion, of course, with the board talking for hours about the recommendations with its various stakeholder groups.

The EPDP’s policy has been criticized not only for failing to address the needs of law enforcement and intellectual property owners, but also as a failure of the multistakeholder model itself.

One of the sharpest public criticisms came in a CircleID article by Fabricio Vayra, IP lawyer are Perkins Coie, who tore into ICANN last month for defending a system that he says will be worse than the status quo.

But ICANN director Becky Burr told registries and registrars at a joint ICANN 69 session last week: “We don’t think that the EPDP represents a failure of the multistakeholder model, we actually think it’s a success.”

“The limits on what could be done in terms of policy development were established by law, by GDPR and other data protection laws in particular,” she added.

In other words, it’s not possible for an ICANN working group to create policy that supersedes the law, and the EPDP did what it could with what it was given.

ICANN CEO Göran Marby doubled down, not only agreeing with Burr but passing blame to EU bureaucrats who so far have failed to give a straight answer on important liability issues related to the GDPR privacy regulation.

“I think the EPDP came as far as it could,” he said during the same session. “Some of the people now criticizing it are rightly disappointed, but their disappointment is channeled in the wrong direction.”

He then referred to his recent outreach to three European Commission heads, in which he pleaded for clarity on whether a more centralized Whois model, with more liability shifted away from registrars to ICANN, would be legal.

A failure to provide such clarity would be to acknowledge that the EPDP’s policy proposals are all just fine and dandy, despite what law enforcement and some governments believe, he suggested.

“If the European Union, the European Commission, member states in Europe, or the data protection authorities don’t want to do anything, they’re happy with the situation,” he told registrars and registries.

“If they don’t take actions now, or answer our questions, they’re happy with the way people or organizations get access to the Whois data… it seems that if they don’t change or do anything, they’re happy, and then were are where we are,” he said.

He reiterated similar thoughts at sessions with other stakeholders last week.

But he faced some pushback from members of the pro-privacy Non-Commercial Stakeholders Group, particularly during an entertaing exchange with EPDP member Milton Mueller, who’s unhappy with how Marby has been characterizing the group’s output to the EU.

He specifically unhappy with Marby telling the commissioners: “Should the ICANN Board approve the SSAD recommendations and direct ICANN org to implement it, the community has recommended that the SSAD should become more centralized in response to increased legal clarity.”

Mueller reckons this has no basis in what the EPDP recommended and the GNSO Council approved. It is what the IP interests and governments want, however.

In response, Marby talked around the issue and seemed to characterize it as a matter of interpretation, adding that he’s only trying to provide the ICANN community with the legal clarity it needs to make decisions.

These eight companies account for more than half of ICANN’s revenue

Kevin Murphy, October 19, 2020, Domain Policy

While 3,207 companies contributed to ICANN’s $141 million of revenue in its last fiscal year, just eight of them were responsible for more than half of it, according to figures just released by ICANN.

The first two entries on the list will come as no surprise to anyone — they’re .com money-mill Verisign and runaway registrar market-leader GoDaddy, together accounting for more than $56 million of revenue.

Registries and registrars pay ICANN a mixture of fixed fees and transaction fees, so the greater the number of adds, renews and transfers, the more money gets funneled into ICANN’s coffers.

It’s perhaps interesting that this top-contributors list sees a few companies that are paying far more in fixed, per-gTLD fees than they are in transaction fees.

Binky Moon, the vehicle that holds 197 of Donuts’ 242 gTLD contracts, is the third-largest contributor at $5.2 million. But $4.9 million of that comes from the annual $25,000 fixed registry fee.

Only 14 of Binky’s gTLDs pass the 50,000-name threshold where transaction fees kick in.

It’s pretty much the same story at Google Registry, formally known as Charleston Road Registry.

Google has 46 gTLDs, so is paying about $1.1 million a year in fixed fees, but only three of them have enough regs (combined, about one million names) to pass the transaction fees threshold. Google’s total funding was almost $1.4 million.

Not quite on the list is Amazon, which has 55 mostly unlaunched gTLDs and almost zero registrations. It paid ICANN $1.3 million last year, just to sit on its portfolio of dormant strings.

The second and third-largest registrars, Namecheap and Tucows respectively, each paid about $1.7 million last year.

The only essentially single-TLD company on the list is Public Interest Registry, which runs .org. Despite having 10 million domains under management, it paid ICANN less than half of Binky’s total last year.

The anomaly, which may be temporary, is ShortDot, the company that runs .icu, .cyou and .bond. It paid ICANN $1.6 million, which would have been almost all transaction fees for .icu, which peaked at about 6.5 million names earlier this year.

Here’s the list:

VeriSign, Inc.$45,565,544
GoDaddy.com, LLC$10,678,376
Binky Moon, LLC$5,231,898
Public Interest Registry$2,515,416
NameCheap, Inc.$1,755,932
Tucows Domains Inc.$1,747,648
ShortDot SA$1,643,103
Charleston Road Registry Inc.$1,385,356

Combined, the total is over $70.5 million.

The full spreadsheet of all 3,000+ contributors can be found over here.

Lockdown bump was worth $600,000 to ICANN, but end of Club Med saves 10x as much

Kevin Murphy, October 19, 2020, Domain Policy

The coronavirus pandemic lockdowns and the resulting bump in domain name sales caused ICANN’s revenue to come out $600,000 ahead of expectations, up 4%, the org disclosed last week.

But ICANN saved almost 10 times as much by shifting two of its fiscal year 2020 public meetings to an online-only format, due to travel and gathering restrictions.

The organization’s FY20 revenue was $141 million, up by $5 million on FY19, against a rounded projection of $140 million. ICANN’s financial years end June 30.

ICANN said it is “uncertain if these market trends will continue”.

Back in April, the organization lowered its revenue forecast for FY21 by 8%, or $11 million.

Expenses were down $11.1 million at $126 million, 8% lower that expectations and $4 million lower than the 2019 number.

That was mostly due to a $6.2 million saving from having two public meetings online-only.

ICANN typically spends $2 million per meeting funding over 500 travelers, both ICANN staff and community members, but that was down to almost nothing for the first two meetings of this year.

Pre-pandemic, ICANN expected these meetings, slated for Cancun and Kuala Lumpur, to cost $4.2 million and $3.4 million respectively, but the switch to Zoom brought them in at $1.4 million and $0.4 million.

ICANN would have occurred some pre-meeting travel expenses for the Cancun gathering, which was cancelled at the last minute, as well as cancellation fees on flights and hotels.

The org has previously stated that the switch away from face-to-face meetings could save as much as $8 million this calendar year.

The rest of the savings ICANN chalked down to lower-than-expected personnel costs, with hiring slowing during the pandemic.

Incidentally, if you’re wondering about the headline above, it’s a reference to a notorious 2009 WSJ article, and outrage about ICANN’s then $12 million travel budget.

Eleven years later, the FY20 travel budget was $15.7 million.

Something weird’s going on at .sucks

Kevin Murphy, October 14, 2020, Domain Registries

Ever heard of a domainer or cybersquatter putting their freshly-registered domains up for sale at cost?

Me neither, but that’s what seems to be going on at .sucks right now.

The sudden appearance of many hundreds of .sucks domains — many of them matching very famous trademarks — at Sedo and Uniregistry comes as the registry unveils plans to open up a secondary marketplace of its own.

.sucks registry Vox Populi, a part of the Momentous group of companies, wants to open its own marketplace, according to a letter it recently sent to ICANN.

The registry told ICANN it plans to launch a service “whereby a Registrant of a .sucks domain name can list their domain for resale with the Registry”, saying it will “allow our Registrars to show the domain as available for purchase by third parties at the price set by the current Registrant.”

It’s taking a somewhat confrontational approach from the outset, telling ICANN that it does not believe the service would constitute a “registry service” that would require ICANN’s approval under the Registry Service Evaluation Process.

It points to the fact that registrants can already list their .sucks names on existing marketplaces such as Sedo as proof that it’s not a “product or service that only a registry operator is capable of providing, by reason of its designation as the registry operator” requiring the RSEP.

This interpretation strikes me as open to debate, but I’m not going to get into that here.

What’s more interesting is that the vast majority of the domains listed on these competing platforms appear to have been registered relatively recently, in bulk, all via Momentous-owned registrar Rebel, and quite possibly by the same registrant.

What’s weird is that the majority of the .sucks names listed at Sedo have a buy-now price of $199. Some are priced higher. Some priced at $199 at Sedo are priced at $599 at Uniregistry.

$199 is the absolute cheapest you can buy a .sucks domain name anywhere. It’s Rebel’s retail price, and I believe it’s also Vox Pop’s wholesale price. Even the cheapest unaffiliated registrars slap a $50 markup on the registry fee.

The domains started being listed on the aftermarkets after a sharp spike in .sucks sales back in June, where my data shows that over 2,000 names were registered, via Rebel, in the space of about 24 hours.

The .sucks zone file has been growing ever since, swelling from 7,347 — where volume had been flattish and under 8,000 names for years — to 11,255 since June 16, the date of the first spike.

Almost every .sucks listing I spot-checked on Sedo has three things in common: the $199 price-tag, a recent registration date, and a seller who signed up for the service in 2020 submitting their home territory as Turks and Caicos.

Turks and Caicos, which is also where Rebel is legally based, is a British island territory in the Caribbean with fewer than 38,000 inhabitants. It’s often used for offshore company registrations.

Whois records for the domains I checked with June reg dates use Momentous privacy service Privacy Hero, while other more-recent regs list the registrant as Honey Salt Ltd, a company apparently also based in Turks and Caicos.

So what we seem to have here is a registrant willing to invest half a million dollars or more in .sucks domain names, a great many matching famous brands, and then list them for resale at the exact same price he paid for them.

Why would a cybersquatter pay $199 for jackdaniels.sucks or dolceandgabbana.sucks or unitedinternetmedia.sucks and then put them up for sale for $199? It makes no sense to me.

And it comes at a time when Vox Pop is trying to persuade ICANN that there’s a thriving aftermarket for .sucks domains.

I put all these observations to the CEOs of Momentous and the registry earlier today, and Vox Pop chief John Berard got back to us to say:

With regard to those 2,000 registered names, that was most welcome. I don’t know much more than that about Honey Salt… I am certainly not going to speculate on their plans.

That they are in the Turks and Caicos is interesting, for sure. But you know as well as I that the Caribbean is a hotbed of domain name innovation and investment.

He later added: “Yes, take it to the bank that VPR [Vox Populi Registry] is not behind the registrations.”

On the issue of the registry’s own secondary market plans, Berard said:

we are trying to catch up to others in the domain name industry who first saw the customer value of fostering a secondary market. I think we may be the first registry to do it, but we, i am sorry to say, weren’t the first to market.

If I receive more information or commentary on this weirdness I shall provide updates accordingly.

Forty weddings and a funeral? .wed is dead but may come up for auction

Kevin Murphy, October 12, 2020, Domain Registries

.wed has become the first commercial, open, non-branded new gTLD to have its registry contract unilaterally terminated by ICANN, and it could soon be looking for a new home.

ICANN terminated the contract with US-based Atgron last week, almost three years after imposing emergency measures to protect registrants after the company’s business model failed miserably.

The company wanted to provide a space for engaged couples to promote their weddings for about $50 a year, but its business model was based around basically forcing registrants to abandon their names by charging a $30,000 renewal fee after year two.

Unsurprisingly, it attracted few registrants — about 300 at its 2016 peak — and only one registrar.

By the time the end of 2017 rolled around, it was languishing at 39 domains (for the purposes of a whimsical headline, let’s round it up to 40) and its agreement with its back-end registry operator was on the verge of expiring.

In the hope of keeping its customers’ domains working, Atgron turned off its Whois for a week, attracting the attention of ICANN and triggering a criterion for transitioning to an Emergency Back-End Registry Operator.

It’s been on an EBERO, in this case Nominet, since December 2017, with all domains essentially frozen.

In the meanwhile, it’s been fighting against contract termination with ICANN, first in mediation and then in arbitration.

Last month, the arbitrator ruled that Atgron was in breach for failure to pay its ICANN fees, and ICANN terminated the registry agreement October 5.

.wed is certainly not the first new gTLD to get terminated by ICANN — there’s been about a dozen to date — but it is the first to be a non-dot-brand.

This means ICANN will get to test its Registry Transition Process for the first time.

When a dot-brand dies, ICANN just removes it from the root and lets it stay dead on the grounds that there’s no plausible successor and no registrants will suffer.

In this case, we’re talking about an open, non-branded gTLD with a generic string that could potentially rack up many thousands of registrations.

There’d be no obligation for a future operator to take on the silly business model.

The Registry Transition Process will go one of two ways.

If Atgron has already picked a successor registry, ICANN will conduct a series of evaluations that look like they would be a piece of cake for any existing gTLD portfolio owner to pass.

But if Atgron has no heir apparent, it goes to an RFP which basically amounts to an auction, with the company prepared to pay Atgron the most money becoming the company’s presumed preferred successor.

With Atgron still owing ICANN money — presumably hundreds of thousands of dollars — in past-due fees, I’ve little doubt what ICANN’s preferred outcome would be.

For Atgron, there’s the distinct possibility that it could make more money from crashing .wed into the ground than it ever did by actually selling domains.

.wed is not a bad string — it’s short, meaningful, and has a niche of potential registrants already forced to overpay for almost everything else — and I’m fairly confident it could easily find a new home at an existing registry.

Holy Scheisse! Did you know ICANN 69 starts TOMORROW?

Kevin Murphy, October 12, 2020, Domain Policy

ICANN is starting its ICANN 69 public annual general meeting four days earlier than originally planned, and it appears to have only publicly announced the date change 24 hours in advance.

How’s that for transparency?

Usually, ICANN AGMs kick off formally on the Monday morning and run through the Thursday afternoon, but meetings between community groups start taking place the previous Friday, leading to a seven-day continuous meeting.

For ICANN 69, originally planned for Hamburg but now of course an online-only experience, ICANN has removed the Friday and weekend sessions and split the week in two.

There’ll be three “Community Days” from October 13 (which is tomorrow when I’m posting this but possibly today by the time you read it), three days off, and then four days of “Plenary Sessions”, beginning with the opening ceremony on Monday morning.

The community days include stuff like policy working group meetings, but they also include the top-level interactions between each constituency group, including the Governmental Advisory Committee, and the ICANN board of directors.

These traditional airing of grievances, usually on “constituency day” Tuesday, are where the tensions and hot topics of interest for the whole community are raised, and always worth listening to.

The decision to shake up the schedule appears to have been made some time in September. Last time I checked ICANN’s meetings page, September 2, it still showed the old October 17 start date.

What I find utterly baffling is that ICANN does not seem have made a formal public announcement of the date change, despite having blogged or made announcements about various aspects of the meeting several times.

I genuinely only found out today, reading this blog post that ICANN put out today, just one day before the meeting starts.

It certainly seems that the information has filtered out to the parts of the community that actually need to participate in the various sessions.

But what about the rest of us? Unless you’ve registered and logged in to the ICANN 69 web site since the changes were made, I’m not sure how you were meant to know.

Did you know?

I had plans to get my toenails done tomorrow.