Domain growth dropped off in Q3, says Verisign

The third quarter saw the worldwide domain industry base of registrations increase by 600,000 names over the second quarter, according to Verisign’s latest Domain Name Industry Brief.

September ended with 370.7 million names registered across all TLDs, up 0.2% sequentially and 3% year over year.

Annual growth of 10.8 million names is a sharp drop off from the 15.3 million growth seen in Q2, during which many nations were under coronavirus lockdown.

Breaking it down by sector, it’s a case of .com growth being offset by shrinkages in new gTLDs and ccTLD, at least on an annual basis.

.com ended the quarter with 150.3 million names, up from 148.7 million three months earlier, which .net was flat at 13.4 million.

ccTLDs as a whole were at 160.6 million, up by 500,000 sequentially but down by 1.2 million compared to Q3 2019.

Unusually, the ccTLD numbers were not affected one way or the other by free extension .tk, where domains are never deleted. Verisign reports the TLD flat in Q3, but I suspect that’s due to a lack of fresh data rather than anything else.

In the top 10 largest ccTLDs, most grew or were flat sequentially. The notable standout was .uk, which lost a full million domains compared to Q2 due to the expiry of a million second-level names in September.

New gTLDs declined by 1.5 million names to settle at 30.2 million at the end of the quarter, according to the DNIB.

The report can by downloaded from this page.

Nominet shuts down “hostile” discussion forum

Nominet has angered members by unilaterally shutting down a discussion forum that has been for many years the main place for discussions about .uk policy.

The forum, which Nominet hosted on its web site, went dark abruptly during the company’s annual general meeting yesterday.

Speaking to members tuning in to the live webcast, CEO Russell Haworth said that the forum was “dominated by a handful of posters, and has increasingly become aggressive and hostile, not least towards our staff”.

And then it was gone.

Haworth said he expected criticism over the move, which was “fine”, adding that posters have plenty of other venues to air their grievances.

He also suggested periodic Zoom calls to communicate with members.

The decision to close the forum is being greeted poorly by affected members (presumably the ones who most actively used it) on social media and seen as a way for power to be further consolidated among Nominet’s biggest revenue-generators.

Nominet recently came in for criticism for its efforts to grab a slice of the drop-catching pie by charging registrars an extra £600 a year (now, members note, up to £1,000) for additional EPP tunnels.

It also recently admitted privately to members that it last year miscalculated how many votes members they should get in directorship elections, but insisted the error did not have an effect on the outcome of the most recent poll.

The move is not entirely without precedent. Those of you with as many grey hairs as me may recall the old Domain-Policy mailing list, once the central hub for community discussions, going dark back in 2001.

But Verisign, which hosted the list and its archives, explained that move as a measure to reduce redundancy, rather than straight-up admitting that it was a PR move to silence its legion of critics.

Told us so? Nominet ditches auctions plan, will charge drop-catchers higher fees instead

Nominet has ruled out auctioning off expired .uk domains names, after a member rebellion.

The .uk registry said last Thursday that it “will not pursue an auction model”, despite previously indicating that it was the best option for how to reform the dropping domains market.

This means the most likely model in future is going to be a huge increase in fees for registrars that aggressively engage in drop-catching.

A month ago, Nominet said that it was considering changing how it handles dropping domains, with either a system of registry-managed auctions or a system of increased fees for drop-catchers.

It appeared to many (yours truly included), based on a Nominet scoring system for each available option, that auctions were the preferred choice.

The registry originally denied that auctions were a shoo-in and now, apparently responding to critics, has ruled that option out completely.

Registry MD Eleanor Bradley wrote:

we will not pursue an auction model. While a proportion of responses from a wide range of sectors including the drop–catching market supported this approach, the prevailing view was this is not the role of the Registry.

…

Introducing a new approach for those that wish to drop–catch names where participants can purchase connections is the option we will pursue further.

Nominet says that some kind of change is “necessary” because currently .uk drop-catchers are sometimes in the habit of creating spurious Nominet memberships in order to increase the number of simultaneous EPP connections they can use, maximizing their chances of securing drops.

The registry calls this “collusion” and against its acceptable use policies.

In future, it seems drop-catchers will instead have to directly buy extra connections from Nominet. An annual price of £600 ($800) for a batch of six connections, up to a maximum of £6,000 for 60, has previously been floated.

Bradley said that the final details of the plan have yet to be determined.

The decision follows a consultation which received 107 comments and a member petition.

Drop auctions not a slam-dunk, says Nominet

Nominet has responded to criticism of its plans to introduce registry-level .uk drop auctions by saying it’s not about money-grabbing and is not guaranteed to even happen.

Registry MD Eleanor Bradley today blogged:

In some quarters the commentary suggests the driver for change is financial, or to make life more difficult for some business models. It is not.

…

As commercial gain was not our objective, we have suggested that any additional funds raised by changing the policy would be directed towards public benefit activity or used to provide specific services to registrars. Indeed, how to best spend additional funds that result from any policy change is part of the consultation.

The consultation referred to here was launched earlier this month. It suggests replacing the current drop-catching system, in which Nominet suspects some members “collude” to pool their EPP connections, with one of two new processes.

One would be a straightforward auction of desirable dropping names. The other would be to charge drop-catchers up to £6,000 a year for extra concurrent registry connections.

Bradley wrote that “the assumption in some quarters that an auction approach is our preferred option — a fait accompli –- are wide of the mark”.

As I’m one of the people who reported that auctions were Nominet’s “apparently preferred” option, I’ll note that my take was based on the company’s own consultation document, which scores auctions more highly than the alternative on a five-point scale of its own devising.

And a preferred option is not the same as a fait accompli, of course.

The consultation is open for a couple more weeks. A group of disgruntled members plan to petition the board to retain the status quo at its AGM in September.

Nominet members revolt over “deepest pockets wins” auction plans

A group of Nominet members and registrars have launched a petition to prevent Nominet from introducing registry-level auctions for dropping .uk domain names.

The petition, organized by Netistrar, reads: “We the undersigned members request that Nominet maintains equal registrar access to expired domain names on a first come first served basis.”

Nominet recently launched a policy consultation that lays out plans to essentially kill off the existing system of drop-catching expired domains and replace it with either registry auctions or a pay-to-play model asking fees of up to £6,000 a year.

The petition says that “these proposals technically and financially restrict a registrars ability to access expired domains”, noting that other ccTLDs “manage an expiry process without an expensive and centralized auction system.”

So far, 70 registrars and individuals (out of the about 3,000 Nominet members) have signed the petition, but they account for more than 400,000 .uk domains.

The petition will be presented at Nominet’s annual general meeting in September. The current policy consultation ends August 14.

Nominet wants to kill off the .uk drop-catching market

Nominet has revealed a sweeping set of policy proposals that would totally revamp how expired domains are deleted and could essentially kill off drop-catching in the .uk domains market.

The company is thinking about auctioning off expired domains at the registry level, or charging drop-catchers up to £6,000 ($7,500) a year to carry on more or less as normal.

Currently, expired .uk domains are deleted at an undisclosed time each day, leading drop-catch registrars to spam the registry back-end with availability checks on the best names.

Upon finding a desired domain has dropped, they then attempt to register it immediately by spamming EPP create commands.

About 0.7% of the domains deleted each year, about 12,000 of the 1.76 million names dropped in 2018, are re-registered within a second of release, Nominet says.

The system as it stands bothers the registry due to the technical load it creates and the fact that it means the most desirable names are snapped up by small number of domainers for resale.

It also does not like the fact the current system encourages collusion between Nominet members and the creation of dummy memberships by drop-catchers.

So it’s proposing two main options for rejiggering the economics.

The first and apparently preferred solution would be for Nominet to auction off the names, rather than deleting them. It would look a lot like auctions often seen in newly launching TLDs.

The second option is to charge drop-catchers extra fees for a greater number of simultaneous EPP connections.

Currently, each registrar gets six. Under the proposal, called “Economically controlled access to expiring domains”, they’d be able to buy additional batches of six for £600 a pop, up to a maximum of 10 batches or £6,000.

Regardless of which option is chosen, Nominet also wants to make drop times more predictable, by publishing a daily drop-list available to all.

Nominet knows there’s a pretty good chance it’s going to be accused of profiteering, and says in the paper:

If either of the options proposed are implemented, we envisage that any profits derived from the auction or economically controlled access models will be directed towards public benefit activity and/or ringfenced to provide specific services to registrars e.g. a training fund. However, we are also seeking ideas on how any profits would be best spent to benefit the .UK namespace in this consultation.

The consultation can be found here. Interested parties have until August 14 to submit comments.

Criminal .uk suspensions down this year

Nominet suspended fewer .uk domain names due to reports of criminality in the last 12 months that in did in the prior period.
The registry said last week that is suspended 28,937 domains in the year to the end of October, down from 32,813 in the 2018 period.
That’s 0.22% of all .uk names, Nominet said.
As usual, complaints about intellectual property infringement — filed by copyright owners to the IP cops and handed to Nominet — account for the vast majority of takedowns, some 28,606 in the period.
The rest were suspended due to complaints about fraud, trading standards, financial conduct and healthcare products.
Only 16 requests were denied by Nominet, down from 114 in the previous year, and only five false-positive suspensions were reversed.
The controversial ban on “rape” domains resulted in 1,600 new regs getting automatically flagged, but zero getting suspended.
There were no requests from the Internet Watch Foundation to take down child sexual abuse material.
Nominet’s newish automated anti-phishing system, which uses pattern recognition to flag potential phishing domains at point of registration, saw 2,668 domains suspended before going live, of which 274 were released after the registrant passed due diligence checks.

Three big changes could be coming to .uk

Nominet wants to know what you thinking about three significant policy changes that could be implemented in the next year or so.
The .uk registry today published a consultation document covering two security-related changes and one related to expired domains.
First, Nominet wants to know if it should be allowed to preemptively block resolution on newly registered domains where it has “identified a high risk the domain will be used for phishing”.
It looks like more of a cosmetic policy change, given that the company is already blocking suspected phishing domains where the registrant fails to adequately verify their identity.
About 1,500 domains were blocked like this in the 12 months ending July 2019, Nominet says, on the basis of its Domain Watch program, which combines technical and manual oversight to identify phishy-looking names.
Second, Nominet want to know if it should display an standard informational web page when it blocks a domain on the basis of fraud, copyright infringement, and counterfeiting.
Currently, the company takes down tens of thousands of names every year on this basis, but the names are simply removed from the zone file and refuse to resolve.
Nominet’s friends in law enforcement reckon that allowing the the domains to instead resolve to a standard web page instead could help victims of fraudulent sites help with police investigations, and Nominet wants to know if you agree.
A side-effect of this would be that the names would remain in the zone, so we’d be able to see for the first time which names get suspended for fraud.
Third, Nominet wants to know whether it should start openly publishing drop-lists, the list of domains that have expired registrations and are about to become available.
This appears to be bad news for those registrars currently “excessively” pinging the registry to compile their own lists and get the jump on competitors when it comes to drop-catching valuable names for resale.
Nominet seems to want to see fewer dropped domains winding up in the hands of domainers, saying currently “not all dropping domains are registered and actively used by the new registrant, reducing the vibrancy of .UK domains”.
It’s proposing to give drop-lists just to registrars, or to publish them openly.
All three questions are open for comment until December 15.

Nominet raises .uk prices

Nominet is to raise the price of a .uk domain name in January, adding a couple million quid to its top line.
The company’s annual registry fee will increase by 4%, from £3.75 to £3.90 ($4.77), on January 13 next year.
Nominet said the increase is to reflect “some of the increased costs of running the registry business since prices last changed in 2016.”
While it’s a modest £0.15 extra per name per year, at the current registration volume that works out to just shy of £2 million ($2.45 million) more revenue per annum.
Perhaps predicting a backlash from large-volume registrants, Nominet told registrars:

We appreciate that price rises are never popular, but even after this modest rise, .UK domains remain extremely competitively priced in the market and accessible to all.

If US dollars are your frame of reference, .uk names will still actually be cheaper following the price increase than they were following the 2016 price increase, due to exchange rate fluctuations.
The last price increase went into effect in March 2016. Before that, prices had been unchanged since 1999.

These two ccTLDs drove two thirds of all domain growth in Q2

The number of registered domain names in the world increased by 2.9 million in the second quarter, driven by .com and two ccTLDs.
That’s according to the latest Verisign Domain Name Industry Brief, which was published (pdf) overnight, and other data.
The quarter ended with 354.7 million domains. Verisign’s own .com was up 1.5 million over Q1 at 142.5 million names.
ccTLDs across the board grew by 1.9 million names sequentially to 158.7 million. Year-over-year, the increase was 10.5 million domains.
The sequential ccTLD increase can be attributed almost entirely to two TLDs: .tw and .uk. These two ccTLDs appear to account for two thirds of the overall net new domains appearing in Q2.
Taiwan grew by about 600,000 in the quarter, presumably due to an ongoing, unusual pricing-related growth spurt among Chinese domainers that I reported in June.
The UK saw an increase of roughly 1.3 million domains, ending the quarter at 13.3 million.
That’s down to the deadline for registering second-level .uk matches for third-level .co.uk domains, which passed June 25.
Nominet data shows that 2LDs increased by about 1.2 million in the period, even as 3LDs dipped. The difference between this and the Verisign data appears to be rounding.
Factoring out the .uk and .tw anomalies, we have basically flat ccTLD growth, judging by the DNIB data.
Meanwhile, the new gTLD number was 23 million. That’s flat after rounding, but Verisign said that the space was actually up by about 100,000 names.
Growth as a whole was tempered by what I call the “other” category. That comprises the pre-2012 gTLDs such as .net, .org, .info and .biz. That was down by about a half a million names.
.net continued its gradual new gTLD-related decline, down 200,000 names sequentially at 13.6 million, while .org was down by 100,000 names.
The overall growth numbers are subject to the usual DNIB-related disclaimers: Verisign (and most everyone else) doesn’t have good data for some TLDs, including large zones such as .tk and .cn.