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Innovative Auctions hires storied new employee

Kevin Murphy, June 15, 2013, Gossip

Innovative Auctions, which is running private new gTLD auctions, has hired a poker-playing former Google engineer and grandson of Nobel-winning economist Milton Friedman.

Patri Friedman becomes the company’s 11th employee, according to an Innovative blog post.

According to his Wikipedia page, Friedman has had some success playing high stakes poker and was once a software engineer for Google, but his most recent gig was with the Seasteading Institute, where he’s still listed as chairman.

Seasteading is an ambitious project to create a floating libertarian nation state off the coast of Northern California, like something out of Neal Stephenson’s Snow Crash. Really.

At Innovative, he’ll be in charge of user experience and documentation, which seems quite dull in comparison.

Innovative has so far carried out just six new gTLD auctions. Presumably, it’s expecting to manage many more.

Donuts loses five of the first six new gTLD auctions

Kevin Murphy, June 13, 2013, Domain Services

The full results of the first six new gTLD auctions are now known. Donuts lost five of them, raising millions of dollars in the process.

Here are the winners of last week’s auctions, which were managed by Innovative Auctions:

Five of the six were a two-way battles between Donuts, which has applied for 307 gTLDs, and one other applicant. Each of the losing applicants has now withdrawn its application with ICANN.

The exception is .club, a three-way fight that included Merchant Law Group. Neither losing application has been withdrawn with ICANN yet, but the result it well-known.

Innovative revealed last week that the round raised $9.01 million in total. The winning bids for each auction were not disclosed.

Given that Donuts managed to lose five out of the six, it’s a fairly safe assumption that most of that money will have gone into its war chest, which can be used in future auctions.

Of the five applications it has now withdrawn, only .red had already passed its Initial Evaluation, so the company will have also clawed back a $130,000 ICANN refund on each of the other four.

The auctions mean that we now know with a high degree of certainty which companies are going to be running these six gTLDs.

Most of them have not yet passed IE, but with the success rate so high to date I wouldn’t expect to see any failures. None of them are subject to objections or direct GAC Advice.

Six private new gTLD auctions raise $9m

We now know (roughly) how much a new gTLD is worth.

The new gTLD contention sets for .club, .college, .luxury, .photography, .red, and .vote have been settled in a series of auctions this week that raised over $9 million.

That’s an average price of $1.5 million per string.

Writing on CircleID, Innovative Auctions project director Sheel Mohnot confirmed that the withdrawal of Donuts’ application for .vote was a result of losing the auction.

We also already know that .CLUB Domains won its auction.

But Mohnot did not reveal the winners of the other four auctions, each of which was a two-way fight between Donuts and one rival. ICANN’s web site does not yet reflect any other withdrawals.

His article does, however, quote Top Level Design and Luxury Holdings, which applied for .photography and .luxury respectively, as saying they were happy with the outcome.

Assuming they won too (which is of course not certain) that would mean Donuts lost at least four of the six auctions.

Donuts had originally submitted 63 strings to auction, but they could of course only go ahead if all of its competitors agreed to participate.

One wonders if the company submitted its lowest-value strings first in order to build up its war chest for future auctions. A good chunk of the $9 million raised will have flowed straight into its coffers.

Private gTLD auctions really will be private

The first new gTLD auctions to be held by Innovative Auctions is set to take place on Monday, but we won’t know which applicants took part until after the fact.

Innovative, which is managing the auction process designed by Cramton Associates, told DI it might announce the participants next week, after the auctions are over.

Failing that, we’ll have to infer the winners from which applications are subsequently formally withdrawn from contention with ICANN.

The only companies to publicly announce their participation so far are Donuts and Demand Media — which as partners are obviously not in any contention sets with each other — and .Club Domains.

Donuts has previously announced that it would submit 63 applications to auction, but 17 of those probably won’t go ahead because Uniregistry, which doesn’t like the private auction idea, has declined to take part.

Demand Media’s applicant, United TLD Holdco has committed its bids for .fishing, .green, .mom, .rip and .wow to the auction. Unless Uniregistry has changed its mind, the .mom one won’t be happening.

It also seems unlikely many winning bids will be disclosed.

Under the terms designed by Cramton, if only one applicant in an auction decides it wants to keep the outcome private, the other applicants will be contractually bound to keep schtum.

Private auctions will see money flow to losing applicants, some of which will also face ICANN-managed auctions at a later date. They may not want to reveal their wedge by having their pay-off public knowledge.

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