CentralNic to swell with $24m Instra buy

CentralNic is set to grow revenue by almost three quarters by acquiring Australian registrar Instra for $23.7 million.
The acquisition is for AUD 33 million, AUD 30 million of which will be in cash.
CentralNic plans to raise £10 million ($15 million) with a share placement to help fund the deal.
“This acquisition will grow our current revenues by 70% and extend our retail capabilities to serve customers in the fast growing emerging markets, globally,” CEO Ben Crawford said in a statement to the markets.
Instra had revenue of AUD 14.8 million ($10.7 million) in its fiscal 2015, and was profitable.
CentralNic’s revenue for the first half of this year was £4.4 million ($6.8 million).
The deal makes CentralNic, which started life as a registry, a much larger player in the registrar market.
It acquired Internet.bs for $7.5 million a couple of years ago, which brought in $2.8 million of revenue in the first half of this year.
Instra offers 150 ccTLDs and all the gTLDs, according to CentralNic.

How one registrar allegedly dodges ICANN Compliance

A Chinese registrar has been accused by ICANN of playing games to avoid complying with Whois policy.
In a breach notice from ICANN Compliance last week, Beijing-based 35 Technology is told that it has failed to verify Whois records as required by its accreditation agreement.
The domain in question was shoesbbalweb.com, which DomainTools’ archived screenshots show was once used to sell branded running shoes.
I understand that 35 is believed to have suspended the domain when ICANN first referred a Whois accuracy complaint to it.
It is then said to have un-suspended the domain, without any change to the Whois record, as soon as ICANN closed the complaint.
The breach notice (pdf) instructs 35 to:

Provide records and information demonstrating that 35 Technology took steps to verify and validate the Whois information of the domain name since 23 March 2015, or provide ICANN with an explanation why the domain name suspension was removed without verifying and validation Whois information

The switcheroo appears to have been brief enough that its suspended state was not recorded by DomainTools.
ICANN has a monitoring program, however, that randomly spot-checks previously complained-about domains for ongoing compliance.
The registrar, which does business at 35.com, is not tiny. It had over 450,000 domains under management, in legacy gTLDs and a handful of Chinese-script new gTLDs, at the last count.
It has until the end of the month to explain itself or risk termination.

Web.com just gave itself another reason to bid high for .web gTLD

Registrar group Web.com is changing its stock market ticker symbol to WEB tomorrow, in another sign that it really, really wants to be identified with the string.
The switch from WWWW may indicate that the NASDAQ-listed company’s six rivals for the new gTLD .web have a fight — and a possible big payday — on their hands when .web finally goes to auction.
Web.com is competing with Nu Dot Co, Radix, Google, Donuts, Afilias and Schlund for the gTLD.
The company has already fiercely defended its “right” to .web, filing successful String Confusion Objections against .webs applicant Vistaprint.
Vistaprint subsequently filed an ICANN Independent Review Process complaint to appeal its SCO loss.
Last month, the IRP was won by ICANN, but the panel left the door open for ICANN to reconsider its decision.
The .web auction is not likely to go ahead until the Vistaprint issue is resolved.
If ICANN decides the two strings can be delegated separately, what I think is the last barrier to the .web auction going ahead disappears.
If not, then Vistaprint finds itself as the seventh contender in the auction, which may give it the impetus to carry on challenging the ruling.
ICANN’s board plans to discuss the issue at its next meeting, December 10.
Which way it leans will give an indication of how long it will be before .web goes to auction.

European privacy ruling could add to registrars’ costs

European domain registrars say they are facing increased costs of doing business due to a recent court ruling on privacy protection.
As a result, US data escrow giant Iron Mountain is likely to lose a lot of its ICANN business, as EU registrars defect to local alternatives such as UK-based NCC Group.
The ruling in question deals with the so-called “safe harbor” principles, under which European companies were able to transfer customers’ private data to US companies as long as the recipient promised to abide by EU privacy protection rules.
However, former spy Edward Snowden’s revelations of widespread privacy violations by the US government seemed to show that many US tech giants were complicit in handing over such data to US spooks.
And now the European Court of Justice has ruled the safe habor principles invalid.
This affects registrars because, under their ICANN contracts, they have to escrow registrant data on a weekly basis. That’s to prevent registrants losing their domains when registrars go out of business or turn out to be crooks.
While registrars have a choice of escrow agents, pretty much all of them use Iron Mountain, because ICANN subsidizes the service down to $0.
However, with the ECJ ruling, Euro-registrars have told ICANN that it would now be “illegal” to continue to use Iron Mountain.
In a recent letter (pdf) to ICANN, about 20 EU-based registrars said that non-European registrars would get a competitive advantage unless ICANN does something about it.
They want ICANN to start subsidizing one or more EU-based escrow agents, enabling them to switch without adding to costs.

the service fees of those [alternative] providers are not being supported by ICANN. Thus, the only solution for EU based registrars to comply with their local laws is to support this extra cost.
We are sure, you will agree this clearly constitutes an unfair disadvantage to a given category of a registrars.
This is why we ask ICANN to offer the same terms as it currently does to Iron Mountain to other RDE [Registrar Data Escrow] providers established in the European Economical Area to ensure a level playing field for registrars globally.

According to the registrars, they have until January to switch, so ICANN may have to move quickly to avoid unrest.

Endurance splashes out $1.1 billion on Constant Contact

Endurance International is to acquire email marketing company Constant Contact for $1.1 billion.
The $32-a-share cash offer, a 23% premium on Constant Contact’s Friday closing price, has been approved by both boards.
Endurance counts registrars BigRock, Domain.com and ResellerClub among its portfolio of brands, which also includes hosting companies HostGator and BlueHost.
The company said the deal will push its annual revenue to over $1 billion for the first time.
Endurance has acquired over 40 companies in its history, according to CEO Havi Ravichandran, who described M&A activity as a “core competency”.
The deal, which is subject to regulatory and shareholder approval, will be funded with debt.
The company today reported a third-quarter loss of $15.4 million, about double its year-ago loss, on revenue that was up 18% to $188.5 million.

Credit card hack cost Web.com millions

Web.com is taking a $1 million per-quarter hit to its revenue as a result of August’s hacking attack.
It also incurred $400,000 in consulting, legal and credit monitoring fees in the third quarter as a result of the breach, CEO David Brown told analysts last night.
Some 93,000 credit card numbers were stolen during the attack, a small portion of its 3.3 million customers.
A number of customers jumped ship as a result of the attack, moving their domains elsewhere, which increased Web.com’s churn rate.
“Due to the subscription nature of our business, in the fourth and subsequent quarters we expect the breach will have about a $1 million negative impact on revenue per quarter due to the shortfall from Q3,” Brown said.
It added 15,000 customers in the quarter, lower than the 21,000 it added in Q2.
Net income for the quarter was $6.1 million, reversing a $3.4 million loss in the year-ago period, on revenue that was basically flat at $136.8 million, compared to $137.4 million a year ago.
In response to an analyst question, Brown also commented on the success, or lack thereof, of the company’s new gTLD business. He said:

That continues to be positive, but we’re not doing back-flips here. It’s not that positive. We think it’s good for the market, good for consumers and businesses to have more choices. But they’re not flying off the table. .com and .net and the original extensions still are the force in the marketplace. But as we see more gTLDs and as the market understands them and see the opportunity, we continue to believe that this will be a positive trend. But at this point, it’s not moving the needle in our business or likely in anyone’s business.

Web.com owns registrars including Network Solutions and Register.com.

Registrars warn of huge domain suspension scam

Customers of at least half a dozen large registrars been targeted by an email malware attack that exploits confusion about takedown policies.
The fake suspension notices have been spammed to email addresses culled from Whois and are tailored to the registrar of record and the targeted domain name.
Customers of registrars including eNom, Web.com, Moniker, easyDNS, NameBright, Dynadot and Melbourne IT are among those definitely affected. I suspect it’s much more widespread.
The emails reportedly look like this:

Dear Sir/Madam,
The following domain names have been suspended for violation of the easyDNS Technologies, Inc. Abuse Policy:
Domain Name: DOMAIN.COM
Registrar: easyDNS Technologies, Inc.
Registrant Name: Domain Owner
Multiple warnings were sent by easyDNS Technologies, Inc. Spam and Abuse Department to give you an opportunity to address the complaints we have received.
We did not receive a reply from you to these email warnings so we then attempted to contact you via telephone.
We had no choice but to suspend your domain name when you did not respond to our attempts to contact you.
Click here and download a copy of complaints we have received.
Please contact us by email at mailto:abuse@easydns.com for additional information regarding this notification.
Sincerely,
easyDNS Technologies, Inc.
Spam and Abuse Department
Abuse Department Hotline: 480-124-0101

The “click here” invitation leads to a downloadable file, presumably containing malware.
Of course, the best way to check whether your domain name has been genuinely suspended or not is to use it — visit its web site, use its email, etc.
As domain suspensions become more regularly occurrences, due to ICANN policies on Whois accuracy for one reason, we can only expect more scams like these.

Domains pointing to social media tiny, but growing

The number of domain names registered via Go Daddy and pointing to social media profiles measures only in the “tens of thousands”, according to the company.
The market leading registrar put out a press release earlier this week stating that “in the last 18 months, customers pointing a domain name to social media sites increased by 37 percent.”
The company said it “attributes the rise in the redirects to customers wanting to control their online identity.”
While it’s an uptick for sure, the number of domains behaving this is actually still quite low.
A Go Daddy spokesperson told DI: “We’re not releasing exact numbers, but it’s in the tens of thousands.”
That’s a drop in the ocean compared to the over 60 million domains Go Daddy has under management.
The press release promoted the company’s new Personal Domains sales page, which offers buyers a streamlined way to point their domains to their Facebook, Twitter, LinkedIn or Tumblr profiles.

ICANN: we won’t force registrars to suspend domains

In one of the ongoing battles between registrars and the intellectual property lobby, ICANN’s compliance department seems to have sided with the registrars, for now.
Registrars will not be forced to suspend domain names when people complain about abusive or illegal behavior on the associated web sites, according to chief contract compliance office Allen Grogan.
The decision will please registrars but will come as a blow to the likes of music and movie studios and those who fight to shut down dodgy internet pharmacies.
Grogan yesterday published his interpretation of the 2013 Registrar Accreditation Agreement, specifically the section (3.18) that obliges registrars to “investigate and respond appropriately” abuse reports.
The IP crowd take this to mean that if they submit an abuse report claiming, for example, that a web site sells medicines across borders without an appropriate license, the registrar should check out the site then turn off the domain.
Registrars, on the other hand, claim they’re in no position to make a judgment call about the legality of a site unless presented with a proper court order.
Grogan appears to have taken this view also, though he indicated that his work is not yet done. He wrote:

Sometimes a complaining party takes the position that that there is only one appropriate response to a report of abuse or illegal activity, namely to suspend or terminate the domain name registration. In the same circumstances, a registrar may take the position that it is not qualified to make a determination regarding whether the activity in question is illegal and that the registrar is unwilling to suspend or terminate the domain name registration absent an order from a court of competent jurisdiction. I am continuing to work toward finding ways to bridge these gaps.

It’s a testament to how little agreement there is on this issue that, when we asked Grogan back in June how long it would take to provide clarity, he estimated it would take “a few weeks”. Yet it’s still not fully resolved.
His blog post last night contains a seven-point checklist that abuse reporters must conform to in order to give registrars enough detail to with with.
They must, for example, be specific about who they are, where the allegedly abusive content can be found, whose rights are being infringed, and which laws are being broken in which jurisdiction.
It also contains a six-point checklist for how registrars must respond.
Registrars are only obliged to investigate the URL in question (unless they fear exposure to malware or child abuse material), inform the registrant about the complaint, and inform the reporter what, if anything, they’ve done to remediate the situation.
There’s no obligation to suspend domains, and registrars seem to have great leeway in how they treat the report.
In short, Grogan has interpreted RAA 3.18 in a way that does not seem to place any substantial additional burden on registrars.
He’s convening a roundtable discussion for the forthcoming ICANN meeting in Dublin with a view to getting registrars to agree to some non-binding “voluntary self-regulatory” best practices.

GoDaddy did not cybersquat the Oscars, court finds

In a landmark decision, a US court has ruled that GoDaddy’s practice of parking unused domains with Google advertising does not count as cybersquatting.
The Academy of Motion Picture Arts and Sciences, which runs the annual Oscars awards, sued the registrar five years ago after seeing that GoDaddy had parked hundreds of names containing its mark.
Under UDRP, registrar parking is controversially often taken as a sign of the registrants bad faith by panelists.
But the California court ruled that GoDaddy’s actions did not amount to trademark infringement due to the unique circumstances of the case.
GoDaddy did not select the advertisements — Google’s algorithms did — nor did it manually review which domains were being parked.
Domain Name Wire has a pretty good breakdown of the key points in the 129-page ruling.
What’s going to be interesting is whether UDRP panelists — which sometimes take their cues from US legal precedent — will start to adjust to view registrar parking in a more benign way when judging registrant bad faith.