Demand Media has confirmed its plan to spin off its domain name business into a separate company.
The new firm will be called Rightside. As the (rather good) name suggests, it will include the company’s interests in over 100 new gTLD applications and registries.
As well as United TLD, it will also include eNom, Name.com and Demand’s stake in NameJet.
Rightside will be based in Kirkland, Washington, and headed by new appointed CEO Taryn Naidu, who’s been running Demand’s domain unit internally for the last couple of years.
Are the synergies between domain name registrars and content farms not all they were cracked up to be?
That’s a question emerging from last night’s news that Demand Media is planning to spin off its domains business, which includes number-two registrar eNom, into a separate public company.
The company, reporting its fourth-quarter earnings, said that it’s looking into the possibility of breaking up content and domains into two separately-owned businesses.
The new domain company would comprise eNom (wholesale) and Name.com (retail) on the registrar side, any new gTLDs Demand manages to win, the formative registry back-end business, and its stake in NameJet.
“We believe that a separation of the two independent companies will better position each business to pursue their increasingly diverse strategic priorities and opportunities,” CEO Richard Rosenblatt told analysts.
The spin-off would have revenue of over $150 million a year and margins of almost 20%, chief financial officer Mel Tang added.
Rosenblatt said new gTLDs will be “transformative” for the domain industry, saying that Google, Amazon and dot-brands will help grow consumer awareness of the world beyond .com.
Demand has filed 26 new gTLD applications of its own, and has 50-50 rights to 107 more with Donuts.
Previously, Demand has stated in regulatory filings that it used data gathered from domain name lookups to create ideas for the content farm side of its business. It’s not clear if that would continue after a split.
Demand Media executive vice president Taryn Naidu said newly acquired registrar Name.com plans to carry as many TLDs as possible, but urged new gTLD applicants to start distribution talks with registrars as soon as possible.
“It’s going to be challenging to offer all of them,” Naidu told DI today. “We’re asking registries to come talk to Name.com early and often to make sure they get the shelf space.”
“They have to come with a plan, and make sure they’re ready to go to market,” he said.
Demand Media announced the acquisition of Name.com earlier today. The deal, for an undisclosed amount, will see the 30-strong Denver, Colorado-based company join number two registrar eNom in the Demand stable.
Name.com is almost 10 years old and has almost 1.5 million domains under management, the majority of them in gTLDs. eNom has over 12 million domains spread across scores of registrar accreditations.
Naidu said that the forthcoming new gTLD market was a major reason for the deal.
While eNom is primarily a channel player, Name.com is all about the customer-facing retail side of the registrar business.
Owning Name.com could give Demand Media a faster way to market the dozens of new gTLDs that it has itself applied for, as well as the 300 it has partnered with uber-applicant Donuts on.
Naidu declined to comment on details of the Donuts relationship, but I’d be quite surprised if a commitment to carry its TLDs is not part of the deal.
He also said he’s not too worried about alienating eNom’s existing reseller channel, pointing out that main retail rivals such as Go Daddy and Tucows also have extensive reseller networks.
“In many regards having access to a retail player like this will help us serve our resellers by better understanding their needs,” he said.
ICM Registry and Name.com have teamed up to give a free one-year .xxx domain name registration to 3,500 selected porn stars.
It’s part of ICM’s Adult Performer Program, which saw these performers’ names initially reserved.
According to ICM, Name.com has pre-paid for the first year’s registration, valid until February 3 next year, but participating individuals will of course be free to move to another registrar if they choose.
That works out to $210,000 in registry fees, if I’m understanding the deal correctly, which seems like a bit of a risk given the general hostility to .xxx from the mainstream porn industry.
Name.com charges $84.99 for .xxx domains.
The Adult Performer Program came in for a bit of criticism last year, when some actresses tried to defensively register their names not realizing they had been reserved.