.music update: I’m calling it for Costa

Amazon has pulled out of the fight for the .music gTLD, and I’m ready to call the race.
In full knowledge that this could be my “Dewey Defeats Truman” moment, it seems to me the balance of evidence right now is strongly pointing to a win for DotMusic over sole remaining rival bidder MMX.
The contention set originally had eight applicants, but six — Google, Donuts, Radix, Far Further, Domain Venture Partners and last night Amazon — have withdrawn over the last week or so.
This is a sure sign that the battle is over, and that the rights to .music have been auctioned off.
The two remaining applicants yet to withdraw are DotMusic Ltd, the Cyprus-based company founded and managed by music enthusiast and entrepreneur Constantinos Roussos, and Entertainment Names Inc, a joint venture managed by MMX (aka Minds + Machines).
One of them will withdraw its application soon, and my money’s on MMX.
Neither company will talk to me about the result.
But, as I observed Monday, DotMusic has recently substantially revamped its web site, and appears to be accepting “pre-registrations” for .music domains. These are not the actions of a loser.
MMX, on the other hand, has never shared Roussos’ public enthusiasm for .music and has never been particularly enthusiastic about winning private gTLD auctions, usually preferring instead to enjoy the proceeds of losing.
There are only two wildcard factors at play here that may soon make me look foolish.
First, the joint venture partner for Entertainment Names is an unknown quantity. Its two directors, listed in its .music application, are a pair of Hollywood entertainment lawyers with no previous strong connection to the ICANN ecosystem. I’ve no idea what their agenda is.
Second, MMX did not mention .music once in the “Post Period Highlights” of its recently filed 2018 financial results statement. It did mention the resolution of the .gay and .cpa contention sets, but not .music.
That filing came out April 3, at least a few days after the contention set had been won, but I’m assuming that the tight timing and/or non-disclosure agreements are probably to blame for the lack of a mention for .music.
So, on balance, I’m calling it for Roussos.
With a bit of luck we’ll have confirmation and maybe a bit of detail about potential launch dates before the week is out.

Did Roussos pull off the impossible? Google, Donuts, Radix all drop out of .music race

Google won’t be the registry for the .music gTLD.
The company, along with pure-play registries Donuts and Radix, late last week withdrew their respective applications from the .music contention set, leaving just three possible winners in the running.
Those are Amazon, MMX, and DotMusic, the company run by long-time .music fanboy Constantinos Roussos.
As I blogged last week, applications from Domain Venture Partners and Far Further have also been withdrawn.
I suspect, but do not know for a fact, that the contention was settled with a private deal, likely an auction, recently.
The logical guess for a winner would be Amazon, if only because of the nexus of its business to the music industry and the amount of money it could throw at an auction.
But I’m beginning to suspect that DotMusic might have prevailed.
The company appears to have recently revamped its web site, almost as if it’s gearing up for a launch.
Comparing the current version of music.us to versions in Google’s cache, it appears that the site has been recently given a new look, new copy and even a new logo.
It’s even added a prominent header link inviting prospective resellers to sign up, using a form that also appears to have been added in the last few weeks.
These changes all seem to have been made after the crucial ICANN vote that threw out the last of DotMusic’s appeals, March 14.
Are those the actions of an applicant resigned to defeat, or has Roussos pulled off the apparently impossible, defeating two of the internet’s biggest companies to one of the industry’s most coveted and controversial strings?
Participants in gTLD auctions typically sign NDAs, so we’re going to have to wait a bit longer (probably no more than a few days) to find out which of the remaining three applicants actually won.

Looks like .music is finally on its way

The hard-fought battle for .music appears to be over.
I’m not yet in a position to tell you which of the eight applicants for the new gTLD has been successful, but I can tell you some of those who were not.
Two applicants have this week withdrawn their bids, an almost certain sign that the contention set has been privately settled.
The first applicant to ditch its bid was dot Music Ltd, an application vehicle of Domain Venture Partners (we used to call this outfit Famous Four Media, but that’s changed).
The other is .music LLC, also known as Far Further.
We can almost certainly expect all but one of the remaining applicants to withdraw their applications over the coming days.
Applicants typically sign NDAs when they settle contention privately, usually via an auction.
Far Further was one of two unsuccessful “community” applicants for .music. It had the backing of dozens of music trade groups, including the influential Recording Industry Association of America. Even Radiohead’s guitarist chipped in with his support.
Evidently, none of these groups were prepared to fund Far Further to the extent it could win the .music contention set.
The .music contention set has been held up by the continuing protestations of the other community applicant, DotMusic Limited, the company run by long-time .music cheerleader Constantinos Roussos.
After DotMusic lost its Community Priority Evaluation in 2016, on the basis that the “community” was pretty much illusory under ICANN rules, it started to complain that the process was unfair.
The applicant immediately filed a Request for Reconsideration with ICANN.
.music then found itself one of several proposed gTLDs frozen while ICANN conducted an outside review of alleged irregularities in the CPE process.
That review found no impropriety in early 2018, a verdict DotMusic’s lawyer dismissed as a “whitewash”.
It has since stalled the process several times with requests for information under ICANN’s Documentary Information Disclosure Policy, and more RfRs when those requests were denied.
But this series of appeals finally came to an end March 14, when ICANN’s board of directors finally ruled against DotMusic’s 2016 RfR.
That appears to have opened up the .music set for private resolution.
So who won? I don’t know yet, but the remaining applicants are: DotMusic itself, Google, Amazon, MMX, Donuts and Radix.
There are certainly two very deep-pocketed companies on that list. Could we be looking at Google or Amazon as the new proprietors of .music?
If either of those companies has won, prospective registrants might find they have a long wait before they can pick up a .music domain. Neither of these giants has a track record of rushing its new gTLDs to market.
If the victor is a conventional gTLD registry, we’d very probably be looking at a launch in 2019.

.blog tops 200,000 regs due to WordPress partnership

Knock Knock Whois There, the WordPress-affiliated .blog registry, said today that it has topped 200,000 names for the first time.
The milestone comes after about 28 months of general availability, during which growth has been slow but stable.
The company said it has a respectable renewal rate of 72.74%, which is only a couple of points behind .com.
KKWT’s relationship with its parent company, Automattic, owner of WordPress.com and an accredited registrar in its own right, has been crucial to .blog’s growth.
According to registry transaction reports, two-thirds of all .blog domains are sold via Automattic, which had over 128,000 .blog domains under management at the end of 2018.
Tucows is a distant second, with about 10,000 names.
Automattic promotes .blog prominently on its registrar site, selling for $18.95 a year.
But it’s still sold more .com domains, over half a million so far, at the slightly cheaper price of $15 per year.

.london disaster leads to mixed 2018 for MMX

New gTLD registry MMX, aka Minds + Machines, suffered a huge net loss in 2018, largely due to its disastrous .london contract, even while its operating fundamentals improved.
For the year, MMX reported a net loss of $12.6 million, compared to a 2017 profits of $3.8 million, on revenue up 5% to $15.1 million.
The loss was almost entirely attributable to charges related to an “onerous contract” with one of its partners.
MMX has never disclosed the identity of this partner, but the only outfit that fits the profile is London & Partners, the agency with which MMX partnered to launch .london several years ago.
The registry, expecting big things from the geo-TLD, promised to pay L&P millions over the term of the contract, which expires in 2021.
But it’s been a bit of a damp squib compared to former management’s expectations, peaking at about 86,000 regs last year and shrinking ever since.
MMX says the estimated gap between the minimum revenue guarantee payable to L&P and the expected revenue is expected to bring in before 2021, is $7.2 million.
It’s recorded this as a charge on its income statement accordingly, along with another $4.2 million impairment charge related to the same contract.
The company recorded a $7.7 million accounting charge related to this contract in 2016, too.
The company says that to date it has lost about $13.7 million on the deal.
These charges, along with a few other smaller one-off expenses, were enough to push the company into the black for 2018.
But other key performance indicators showed more promise, helped along by the acquisition last year of porn-themed registry operator ICM Register, best-known for .xxx.
Notably, renewal revenue almost doubled, up 97% to $9.4 million.
Domains under management was up 37% to 1.81 million.
Operating EBITDA was $3.6 million, up 12.5%.
Looking ahead, MMX said billings for the first quarter are expected to be up 246%, due to the first impact of the ICM acquisition.
It also said it closed $500,000 of sales in .law in China in March. That would work out to over 5,000 domains, based on the retail price of about $100 a year, but those domains have yet to show up in the .law zone file, which only grew by about 200 domains last month.
MMX said it is planning to launch “a high-value defensive registration product” for corporate registrars by the third quarter.
If I had to guess, I’d say that is probably a clone of Donuts’ Domain Protected Marks List service, which offers trademark owners deep discounts when they defensively block strings across the whole Donuts gTLD portfolio.
It’s a model copied by other registries, including recently Uniregistry.

Donuts raises prices on most TLDs by up to 9%

Portfolio registry Donuts is to jack up prices on most of its 241 gTLDs by up to 9% later this year.
Base-rate price increases of between 6% and 9% will his 220 TLDs, while 16 will remain at their current pricing.
The increases, which do not affect registry-reserved “premium” domains, will likely mean an increase of a few dollars in most cases.
(UPDATE: Donuts says the average price increase is about $1.75.)
Five gTLDs will see their prices reduced. Donuts said .group will see a 35% price reduction. It currently sells for about $30 a year at GoDaddy.
The prices were announced to registrars yesterday and, due to ICANN rules, will not come into effect until October 1.
Registrants are able to lock in their current pricing for up to 10 years by renewing before that deadline.

.com outsells new gTLDs by 2:1 in 2018

The number of registered .com domains increased by more than double the growth of all new gTLDs last year, according to figures from Verisign.
The latest Domain Name Industry Brief reports that .com grew by 7.1 million names in 2018, while new gTLDs grew by 3.2 million names.
.com ended the year with 139 million registered names, while the whole new gTLD industry finished with 23.8 million.
It wasn’t all good news for Verisign, however. Its .net gTLD shrunk by 500,000 names over the period, likely due to the ongoing impact of the new gTLD program.
New gTLDs now account for 6.8% of all registered domains, compared to 6.2% at the end of 2017, Verisign’s numbers state.
Country codes fared better than .com in terms of raw regs, growing by 8.2 million domains to finish 2018 with 154.3 million names.
But that’s including .tk, the free ccTLD where dropping or abusive domains are reclaimed and parked by the registry and never expire.
Excluding .tk, ccTLDs were up by 6.6 million names in the year. Verisign estimates .tk as having a modest 21.5 million names.
The latest DNIB, and quarterly archives, can be downloaded from here.

Registry offers “$2,500” in sweeteners for .inc registrants

The newly launching .inc gTLD may be eye-wateringly expensive, but the registry is offering a package of incentives it reckons adds up to a $2,500 value to new registrants.
Intercap Registry’s .inc went into sunrise today. It’s expected to have retail price of $2,000 and up when it goes to general availability May 7. Sunrise registrants can expect to pay a couple thousand more.
Given the high price, and the fact that many businesses that end in “Inc” will likely view it primarily as an opportunity to waste yet more cash on defensive registrations, I’ve always been a bit skeptical of this particular gTLD.
But I’ve got to give the registry credit for at least making an effort to bump up its value proposition.
It’s currently listing 17 freebies, provided mostly by partners, that new .inc registrants can cash in to soften the dent in their wallets.
Registrants can get a free business formation package from LegalZoom and a free press release announcing their new business issued on GlobalNewsWire, for example. Together, that’s worth over a grand, Intercap says.
Most of the other benefits on offer are discounts on services such as telephony, shared office space, printing, accounting, payment processing and advertising services. Some require additional spending before they can be cashed in.
Partners include Google, Ting, Delta Airlines, Vistaprint and Quickbooks. Some of the offers look like typical affiliate marketing deals.
I imagine different registrants will find different benefits appealing. Some may use none at all. Intercap says more sweeteners will be added in future.
The registry says that its high pricing is there to deter cybersquatters. I imagine this will be successful to a large extent, but that it will probably attract a healthy defensive registration business also.

Most .uk registrants not interested in .uk

The majority of people eligible to register .uk domains at the second level have not yet chosen to do so, according to local registry Nominet.
Numbers the company released this week show that only two million 2LD .uk names have been registered since they first became available five years ago.
That’s despite the fact that the owners of over 10 million domains registered at the third level, such as under .co.uk or .org.uk, had exclusive rights to those names.
Today, the owners of 3.2 million .uk 3LDs have yet to exercise their grandfathered rights, Nominet said.
Those rights expire 0500 UTC June 25 this year.
Nominet plans to ramp up its outreach to affected registrants with radio, print and online ads in May, the company has previously told DI.
If you’re wondering why two million plus 3.2 million does not add up to 10 million, that’s because over the last five years about half of original 10 million domains with grandfathering rights have dropped.
Many will have been re-registered (which does not transfer the rights) or have been replaced with different fresh registrations, which is why Nominet’s total 3LDs under management has only declined from 10.4 million to 9.7 million since 2014.

Australia likely to BAN domaining

Domain investors will soon be no longer welcome in Australia’s .au, if proposed policy changes are approved.
Registrants who own more than 100 names and cannot prove they’re not a domainer will have their names deleted, under the recommendations of an Policy Review Panel appointed by Aussie ccTLD registry auDA this week.
The practice of vacuuming up domains for resale has long been against auDA policy, but the rules have been perceived as weak, easily worked around, and have been rarely enforced.
The current policy states: “A registrant may not register a domain name for the sole purpose of resale or transfer to another entity.”
But domainers have successfully argued that by parking their speculative domains, resale is no longer the “sole” purpose of the registration.
That loophole would be closed under the PRP’s recommendations. If approved by auDA, the rule would be changed to:

A registrant is prohibited from registering any open 2LD domain name for the primary purpose of (a) resale, (b) transfer to another entity, or (c) warehousing.

The PRP noted that it had received input “that registering domain names for resale increases the cost of doing business, increases the scarcity of names, and that registering domain names for the purpose of resale adds no real value to the internet name space.”
Registrants with 100-strong portfolios of “acronyms, dictionary words, or common phrases” would be singled out for review, as would registrants who are seen to engage in the resale of their domains.
Registrants who have “solicited the sale of the domain name or offered the domain name for sale to another for valuable consideration in excess of documented out-of-pocket costs” or who have sold more than six domains in six months, would also be presumed domainers.
Being found to be “warehousing”, domainers would no longer be eligible to their names.
They’d need to show “clear and convincing evidence” that the domain in question was not registered for resale in order to keep their names.
It’s a fairly comprehensive ban on domaining, in other words.
While there may well be workarounds — such as owning matching trademarks or selling shell companies rather than merely the domains — I can’t think of any that would wouldn’t be overly burdensome or costly in the vast majority of cases.
The PRP has also recommended the introduction of opening up .au to direct, second-level registrations, much like the UK, New Zealand and others have over the last several years.
Domainers also hate this, as it could dilute the value of their investments.
The PRP’s final report is now open for public comment until April 12.
After receiving these comments, auDA expects its board to provide a response April 15, which itself will be open for public comment until May 10.