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Now South Africa looks to second-level domain sales

Kevin Murphy, March 13, 2018, Domain Registries

South Africa looks to be the next country to start letting people register domains directly at the second level of its ccTLD.

Local registry authority ZADNA this week opened a policy consultation on allowing registrants access to direct, second-level .za names.

Currently, if you want a .za you have to register at the third level under the likes of or

But ZADNA says second-level names will help it continue to compete in a market now populated by hundreds of new gTLDs.

The company said it has been “inundated” by calls for such a move.

The policy shift would see South Africa follow the the path beaten in recent years by UK, New Zealand, Kenya and (probably) Australia, which have all changed policy to allow second-level names.

But these things are never without controversy.

Domain investors are typically resistant to such moves, fearing dilution and the possible devaluing of their portfolios.

There are often also intellectual property concerns, and concerns about priority “grandfathering” rights when matching and names, for example, have different owners.

ZADNA is floating the possibility of auctions to resolve these kinds of conflicts.

The proposal (pdf) is open for comment until April 16.

auDA probably won’t pass on full Afilias savings to registrants

Kevin Murphy, February 22, 2018, Domain Registries

Switching .au’s back-end to Afilias will cut auDA’s per-domain costs by more than half, but registrants are not likely to benefit from the full impact of the savings.

auDA’s Bruce Tonkin, who led the committee that selected Afilias to replace incumbent Neustar, told DI this week that the organization is likely to take a bigger cut of .au registration fees in future, in order to invest in marketing.

That would include marketing the ability of Aussies to register .au domains at the second level for the first time — a controversial, yet-to-roll-out proposal.

Tonkin confirmed that the back-end fee auDA will be paying Afilias is less than half of what it is currently paying Neustar — the unconfirmed rumor is that it’s 40% of the current rate — but said that Afilias was not the cheapest of the nine bidders.

While .au names are sold for a minimum of two years, the current wholesale price charged to registrars works out to AUD 8.75 ($6.85) per year, of which Neustar gets AUD 6.33; auDA receives the other AUD 2.42.

A back-end fee of roughly $5 (US) per domain per year is well above market rates, so it’s pretty clear why auDA chose to open the contract to competition.

Tonkin explained the process by which Afilias was selected:

We first considered scoring without price, and Afilias received the highest score for non-financial criteria.

We then considered pricing information to form an assessment of value for money. The average pricing across the 9 [Request For Tender] responses was less than half of the present registry back-end fee ($6.33). Afilias was close to the average pricing, and while it was not the cheapest price — it was considered best value for money when taking into account the highest score in non-financial criteria.

I asked Afilias for comment on rumors that its price was 60% down on the current rate and received this statement:

Afilias believes auDA chose us based on the best overall value for the Australian internet community. The evaluation heavily weighted expertise, quality and breadth of service over price. While we don’t know what others bid, Afilias works to be competitive in today’s market. Attempts to price significantly higher than market without a value proposition are unrealistic and could even be considered price gouging.

It’s not known what price Neustar bid for the continuation of the contract, but I expect it will have also offered a deep discount to its current rate.

By switching, auDA is basically going to be saving itself over AUD 3 per domain per year, which works out to a total of AUD 9 million ($7 million) per year at least.

But the organization has yet to decide how much of that money, if any, to pass on to its registrars and ultimately registrants.

The auDA board of directors will meet in March to discuss this, Tonkin (who is in charge of the registry transition project but not on the board) said.

“We don’t want to set expectations that the wholesale price is going to change massively,” he said.

“I don’t expect it’s going to be any higher than the current wholesale price,” he said.

But he said he expects auDA to increase its slice of the pie in order to raise more money for marketing. The organization does “basically no marketing” now, he said.

“There’s certainly strong interest in doing more to market and grow the namespace,” he said. “One option is that more money is put into marketing the namespace and growing awareness of .au… That AUD 2.42, I expect that to change.”

This would include marketing direct second-level registrations, an incoming change to how .au names are sold that has domain investors worried about confusion and market dilution.

Outrage over the 2LD proposal — it appears to be a done deal, even if the details and timeline have yet to be finalized — has started attracting the attention of business media in Australia recently.

But auDA’s own research shows that opposition is not that substantial outside of these “special interests”.

A survey last year showed that 40% of registrants “support” or “strongly support” the direct registration proposal, with 18% “opposed” or “strongly opposed” Another 42% were completely unaware of the changes.

Support among registrants was lower, and it was higher among registrants.

But 36% of “special interests” — which appears to mean people who discovered the survey due to their close involvement in the domain industry — were opposed to the plan.

There’s no current timeline for the introduction of direct registrations, but the back-end handover from Neustar to Afilias is set to happen July 1 this year.

Neustar acquired AusRegistry, which has been running .au since 2002, for $87 million a couple of years ago.

Who should have rights to direct .au names?

Kevin Murphy, October 10, 2017, Domain Registries

Australian ccTLD registry auDA wants to know what you think about its plans to open up .au to direct second-level domain registrations.

It’s no longer a question of if the change should happen, but how it should be implemented.

A public consultation launched yesterday poses a series of questions about issues such as grandfathering, trademark rights and banning certain strings from registration.

It’s already been decided that existing third-level .au registrants should get first dibs on the matching second-level, but auDA has yet to decide what the eligibility cut-off date should be and for how long the names should be reserved before being released for registration by others.

The cut-off date is important because auDA has already seen some data suggesting possible domain investor gaming.

There were 193,645 strings that were registered as third-level domains in two zones at April 18, 2016, when the direct registration policy was announced, but that had risen to 255,909 as of September 1 this year.

That could be indicative of speculators obtaining low-value domains in or in the hope of beating the matching registrant to the possibly more valuable direct second-level .au domain.

If the April 2016 date is used, up to 14% of .au registrations will be subject to competing claims. The data shows that 90% of the conflicts are between and domains.

auDA has declined to draw any conclusions about gaming, however, saying that many of the conflicts could be defensive registrations made by the same registrant.

Where there are conflicts, a number of solutions have been posed. Among them: the longest continuous registration, priority for registrants, auction or lottery.

The consultation paper spends little time discussing the rights of trademark owners, something submissions from the IP lobby will no doubt seek to rectify.

Many of the questions auDA is posing are similar to those posed by the likes of .uk’s Nominet in previous ccTLD consultations.

There’s an additional wrinkle in the .au system as many state government and educational entities are required to register fourth-level names. So auDA wants to know what kind of rights these guys should have too.

The consultation is open until November 10 and all the relevant information can be found here.

Another ccTLD plays down the “com”

Kevin Murphy, September 15, 2017, Domain Registries

Another ccTLD operator has decided to allow registrants to register domains at the second level.

Following a trend that has swept the country-code world over the last few years, Malta’s NIC (Malta) said direct .mt registrations will become available December 1.

Previously, only third-level regs under,,, and were possible.

NIC (Malta) said that existing .mt registrants will be able to claim their matching second-level names for free until the end of November 2020.

That’s a similar policy to the one adopted by Nominet in the UK, one of several ccTLDs to allow “direct” registrations in recent years. Others include New Zealand (.nz), Kenya (.ke) and, possibly but controversially, Australia (.au).

There are no residency requirements to register .mt names. Prices are usually around €20 to €30 per year, but NIC (Malta) said prices will be “halved” come December.

If you’re curious about the second-level policy change opening up new domain hacks, forget about it.

Apart from variations on “dreamt” (which doesn’t even pass a US English spell-check), there are bugger-all words ending in “mt”, according to the various Scrabble-cheating web sites I never use.

Second-level .ke domains go on sale this month

Kenya has become the latest ccTLD to jump on the second-level domain bandwagon.

From this month, registrants will be able to purchase, rather than having to select from third-level domains such as or, according to the registry.

KeNIC becomes the latest ccTLD registry to give customers the SLD option after the UK, New Zealand and Australia, which all backpedaled historic 3LD-only policies in order to remain relevant in an increasingly crowded TLD market.

Unlike previous launches, existing 3LD .ke registrants do not appear to have first right of refusal for the matching SLD, judging by the new policy (pdf).

The launch will begin July 23 with a 30-day sunrise period for trademark owners. This will be followed by a landrush period of 30 days.

Currently, pricing for domains in Kenyan shillings is in the same ballpark as the US dollar cost of a .com domain.

There are reportedly around 62,000 .ke domains currently registered.

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