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Verisign adds 750,000 .com names instantly with reporting change

Kevin Murphy, March 23, 2015, Domain Registries

Verisign has boosted its reportable .com domain count by almost 750,000 by starting to count expired and suspended names.

The change in methodology, which is a by-product of ICANN’s much more stringent Whois accuracy regime, happened on Friday afternoon.

Before the change, the company reported on its web site that there were 116,788,107 domains in the .com zone file, with another 167,788 names that were registered but not configured.

That’s a total of 116,955,895 domains.

But just a few hours later, the same web page said .com had a total of 117,704,800 names in its “Domain Name Base”.

That’s a leap of 748,905 pretty much instantly; the number of names in the zone file did not move.

.net jumped 111,110 names to 15,143,356.

The reason for the sudden spikes is that Verisign is now including two types of domain in its count that it did not previously. The web page states:

Beginning with the first quarter, 2015, the domain name base on this website and in subsequent filings found in the Investor Relations site includes domains that are in a client or server hold status.

I suspect that the bulk of the 750,000 newly reported names are on clientHold status, which I believe is used much more often than serverHold.

The clientHold EPP code is often applied by registrars to domains that have expired.

However, registrars signed up to the year-old 2013 Registrar Accreditation Agreement are obliged by ICANN to place domains on clientHold status if registrants fail to respond within 15 days to a Whois verification email.

The 2013 RAA reads (my emphasis):

Upon the occurrence of a Registered Name Holder’s willful provision of inaccurate or unreliable WHOIS information, its willful failure promptly to update information provided to Registrar, or its failure to respond for over fifteen (15) calendar days to inquiries by Registrar concerning the accuracy of contact details associated with the Registered Name Holder’s registration, Registrar shall either terminate or suspend the Registered Name Holder’s Registered Name or place such registration on clientHold and clientTransferProhibited, until such time as Registrar has validated the information provided by the Registered Name Holder.

Last June, registrars claimed that the new policy — which came after pressure from law enforcement — had resulted in over 800,000 domains being suspended.

It’s an ongoing point of contention between ICANN, its registrars, and cops.

Verisign changing its reporting methodology may well be a reaction to this increase in the number of clientHold domains.

While its top-line figure has taken a sharp one-off boost, it will still permit daily apples-to-apples comparisons on an ongoing basis.

UPDATE:

My assumption about the link to the 2013 RAA was correct.

Verisign CFO George Kilguss told analysts on February 5.

Over the last several years, the average amount of names in the on-hold status category has been approximately 400,000 names and the net change year-over-year has been very small.

While still immaterial, during 2014, we saw an increase in the amount of names registrars have placed on hold status, which appears to be a result of these registrars complying with the new mandated compliance mechanisms in ICANN’s 2013 Registrar Accreditation Agreement or RAA.

In 2014, we saw an increase in domain names placed on hold status from roughly 394,000 names at the end of 2013 to about 870,000 at the end of 2014.

Could Verisign lose $3.3m .gov deal?

Kevin Murphy, March 17, 2015, Domain Registries

The US government has put its feelers out for information about a possible successor to Verisign as manager of the .gov TLD.

A formal Request For Information — potentially a precursor to a Request For Proposals — was was issued by the General Services Administration on March 9.

The GSA, which is the sponsor of the .gov gTLD, seems to be looking for information about all aspects of running a registry back-end and the secure dotgov.gov registrar front-end.

Those functions have been carried out by Verisign since it took them over from the GSA itself in December 2010.

Its five-year contract expires in September this year.

Because it’s restricted to US government entities, .gov is not a large gTLD — the RFI says it has about 5,000 domains and grows at about 5% a year — but it does carry a certain prestige.

It also carries a not inconsiderable fee. According to the September 2010 award page, the deal is worth $3,325,000 to Verisign.

It’s quite possible that the RFI is just a case of the US government going through the necessary motions prescribed by its procurement policies; Verisign may well be a shoo-in.

But the company’s record with .gov isn’t as great as its record with .com and .net.

In August 2013, Verisign screwed up a DNSSEC key rollover in the .gov zone, causing resolution failures on the small number of networks that rigorously enforce DNSSEC.

The deadline for RFI responses is March 23.

Verisign sues .xyz and Negari for “false advertising”

Kevin Murphy, February 24, 2015, Domain Registries

Handbags at dawn!

Verisign, the $7.5 billion .com domain gorilla, has sued upstart XYZ.com and CEO Daniel Negari for disparaging .com and allegedly misrepresenting how well .xyz is doing.

It’s the biggest legacy gTLD versus the biggest (allegedly) new gTLD.

The lawsuit focuses on some registrars’ habit of giving .xyz names to registrants of .com and other domains without their consent, enabling XYZ.com and Negari to use inflated numbers as a marketing tool.

The Lanham Act false advertising lawsuit was filed in Virginia last December, but I don’t believe it’s been reported before now.

Verisign’s beef is first with this video, which is published on the front page of xyz.com:

Verisign said that the claim that it’s “impossible” to find a .com domain (which isn’t quite what the ad says) is false.

The complaint goes on to say that interviews Negari did with NPR and VentureBeat last year have been twisted to characterize .xyz as “the next .com”, whereas neither outlet made such an endorsement. It states:

XYZ’s promotional statements, when viewed together and in context, reflect a strategy to create a deceptive message to the public that companies and individuals cannot get the .COM domain names they want from Verisign, and that XYZ is quickly becoming the preferred alternative.

As regular readers will be aware, .xyz’s zone file, which had almost 785,000 names in it yesterday, has been massively inflated by a campaign last year by Network Solutions to push free .xyz domains into customers’ accounts without their consent.

It turns out Verisign became the unwilling recipient of gtld-servers.xyz, due to it owning the equivalent .com.

According to Verisign, Negari has used these inflated numbers to falsely make it look like .xyz is a viable and thriving alternative to .com. The company claims:

Verisign is being injured as a result of XYZ and Negari’s false and/or misleading statements of fact including because XYZ and Negari’s statements undermine the equity and good will Verisign has developed in the .COM registry.

XYZ and Negari should be ordered to disgorge their profits and other ill-gotten gains received as a result of this deception on the consuming public.

The complaint makes reference to typosquatting lawsuits Negari’s old company, Cyber2Media, settled with Facebook and Goodwill Industries a few years ago, presumably just in order to frame Negari as a bad guy.

Verisign wants not only for XYZ to pay up, but also for the court to force the company to disclose its robo-registration numbers whenever it makes a claim about how successful .xyz is.

XYZ denies everything. Answering Verisign’s complaint in January, it also makes nine affirmative defenses citing among other things its first amendment rights and Verisign’s “unclean hands”.

While many of Verisign’s allegations appear to be factually true, I of course cannot comment on whether its legal case holds water.

But I do think the lawsuit makes the company looks rather petty — a former monopolist running to the courts on trivial grounds as soon as it sees a little competition.

I also wonder how the company is going to demonstrate harm, given that by its own admission .com continues to sell millions of new domains every quarter.

But the lesson here is for all new gTLD registries — if you’re going to compare yourselves to .com, you might want to get your facts straight first if you want to keep your legal fees down.

And perhaps that’s the point.

Read the complaint here and the answer here, both in PDF format.

New gTLDs pummel .net below 15 million domains

Kevin Murphy, January 2, 2015, Domain Registries

Verisign’s .net gTLD has had a disappointing start to 2015, as its zone file dipped below 15 million domains for the first time since achieving the milestone.

As of last night, .net had 14,998,404 names in its zone, a daily dip of over 10,000 domains.

That’s down by about 200,000 names from the roughly 15.2 million it had in March 2014, the earliest count for which I have records.

The gTLD first passed 15 million in August 2013, according to a celebratory blog post at the time.

Verisign has previously blamed the “confusion” created by the launch of new gTLDs for the decline, which was inexorable in 2014.

In October, CEO James Bidzos told financial analysts that “.net may be more susceptible to that confusion that swirls around new gTLDs.”

My similar view is that the existence of new gTLDs is causing people to wake up to the fact that defensive or shopping cart up-sell .net registrations are now superfluous, and that the days of .net riding on big brother .com’s coat-tails may be numbered.

There are still about 31,000 dark .net domains — registered names not present in its zone file — according to Verisign.

At the end of August 2014, .net had 15,569,398 registered names, according to the most recent available ICANN registry report.

Is the free ride over for Verisign’s .net?

Kevin Murphy, October 27, 2014, Domain Services

Verisign’s .net is on the rocks due to new gTLDs, executives have confirmed.

Speaking to investors and analysts on the company’s third-quarter earnings call last week, CFO George Kilguss said that .net “is experiencing some headwinds from the launch of the new gTLD program”.

Further comments from Kilguss and CEO Jim Bidzos seem to confirm what DI reported a month ago: .net is in trouble.

Latest stats collated by DI show that the .net zone file shrunk by over 121,000 domains in the seven months between March 26 and October 26 this year.

Executives said on the call that .net stood at 15.1 million names at the end of September. That compares to 15.2 million at the end of the previous quarter.

“It’s been relatively flat,” Kilguss said. “I actually think .net has held up pretty well over the year with all these new names coming on… So I don’t view .net’s performance as anything negative.”

Bidzos told analysts that “confusion” around the new gTLDs was to blame.

“I think generally, .net may be more susceptible to that confusion that swirls around new gTLDs,” he said.

He characterized .net as being like new gTLDs, falling into “that category of ‘different'”.

In my view, this is an implicit acknowledgement that .net has been getting a free ride for the last 20 years.

Asked whether the .net weakness could spill over to .com, Bidzos said that .com is a “trusted brand” because it’s almost 30 years old and has a 17-year record of uninterrupted up-time.

While there’s no doubt that .com is a trusted brand, it’s not because of its up-time or longevity, in my view — .net has the same stability record and is actually fractionally older than .com.

The reason .net is suffering now is that that for the last two decades it’s been essentially a defensive play.

People buy the .net when they buy the .com because they’ve been marketed as a bundle — the only two truly generic TLDs out there. Unlike .org, .net lost its semantic differentiation a long time ago.

As .com buyers start to see more and more options for duplicative or defensive registrations in their shopping carts, they’re going to be less likely to grab the .net to match their .com, in my opinion.

And it’s likely to get worse.

“It’s going to continue,” Bidzos said. “We’re seeing hundreds of more new gTLDs coming, and they’re coming at the rate of many every single week. So that confusion is likely to get worse.”