Another ccTLD plays down the “com”

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 .com.mt, .org.mt, .net.mt, .edu.mt and .gov.mt 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.

MMX sells 7,000 domains for $3.4 million

New gTLD registry MMX said it has sold $3.4 million in “premium” .vip domains names to Chinese domainers in the last few months.
In what is believed to be a small number of deals to a limited number of investors, “over 7,000” domains changed hands since they became available in late June.
MMX said that $2.8 million of the deals closed in the last 10 days.
While we don’t have the exact number of domains, it looks to work out in the ball-park of $485 per domain.
As $3.4 million is a materially significant number — the company’s entire revenue for 2016 was $15.6 million — it was disclosed to the financial markets this morning.
.vip has been MMX’s cash cow, so far amassing a zone file with more than 600,000 domains names in it.
For some reason it has been hugely popular in China — the vast majority of its registrations have been through Chinese registrars and 59% of its overall revenue was from China in 2016.
In April, the company sold 200,000 .vip names to a single Chinese investor for $1.3 million.
MMX has also said that renewal rates for .vip, which only launched last year, have been over 75%.

.CLUB HQ trashed by Irma, nobody hurt

.CLUB Domains returned to its new digs in Fort Lauderdale, Florida yesterday to find the building trashed by hurricane Irma.

Fortunately, none of the .club gTLD registry’s 17 employees were hurt during Irma, the category 5 hurricane which lashed Florida over the weekend.
Irma caused at least 10 reported deaths in the state and untold amounts of property damage. Over its full path, close to 50 people have been reported killed.
Chief marketing officer Jeff Sass said that “large parts of the roof had been torn away, exposing our office to devastating wind and rain, pretty much ruining everything”.
“Literally, it looks like a bomb went off. I couldn’t believe the damage. It’s truly a sad day for our company. We feel for everyone affected by this horrible storm and we are very fortunate as all our staff are safe,” CEO Colin Campbell said in a blog post.
Ironically, the building had been scheduled for a refurbishment anyway.
.CLUB plans to use the facility as a tech startup incubator under the brand Startups.club. It had recently been approved for funding by the local Fort Lauderdale government, according to Sass.
None of the company’s registry operations, which are based hundreds of miles north in Virginia, were affected by the damage.
Fellow new gTLD registry MMX is legally based in the thoroughly devastated British Virgin Islands, but has no staff or premises there so was unaffected.
Domain Name Wire is reporting that some registry functions of Anguilla’s .ai ccTLD, also in Irma’s path, were not working in its wake.
Photo: .CLUB Domains

XYZ slashes $10 million a year from premium stash

XYZ.com has slashed the asking price of a few thousand “premium” .xyz domain names, in some cases by many thousands of dollars.
Overall, it looks like the company has dropped prices by a total of $10.8 million.
At the top end of its reserved list, several single and double-character domains previously priced a $55,000 per year have been reduced to $13,000 per year.
At the lower end, domains previously priced at around $1,300 are now around $300.
Those are the recommended retail prices. Some registrars are offering them with a substantial mark-up.
The reductions affect 2,700 of the domains on XYZ’s premium list, which runs to about 3,075 names in total.
Whereas the previous hypothetical value of the full list was $15.3 million a year, it’s now at $4.4 million a year.
Of course, they’re not worth anything unless somebody is willing to pay the price, and the domains still seem to have end-user price tags on them.
Premium renewal fees have so far proved unpopular in the domain investing community due to the large carrying cost.
XYZ’s full list can be obtained here.

CentralNic extends XYZ deal until 2032

CentralNic and XYZ.com have extended their registry services pact for the next fifteen years, according to CentralNic.
Announcing its first-half 2017 financial results today, CentralNic said the back-end contract has been extended until 2032.
It’s an unusually long duration for a registry services contract, which are usually much more likely to run about five years.
It even lasts 10 years beyond the expiration of XYZ.com’s own ICANN contracts (though renewal of these is a near-certainty).
The deal covers all .xyz domains, as well as all of the other TLDs in XYZ.com’s portfolio. That currently includes the likes of .rent, .storage and .college.
CentralNic said it “will receive a fixed fee based on the volume of .xyz registrations and subscriptions managed” under the new deal.
In a statement to the markets, CEO Ben Crawford said the relationship “has been updated to normalise the Company’s revenues and profits going forward.”
I believe the previous contract contained a per-domain component, which exposed CentralNic’s revenue to .xyz’s erratic pricing-influenced growth trajectory.
.xyz’s zone file has shrunk by a whopping four million domains since this time last year, causing it to lose the crown of highest-volume new gTLD, due to it offering free or almost free domains that expired without renewing after a year.
However, CentralNic disclosed that the proportion of its own wholesale transaction volumes that were renewals (rather than adds and transfers, I assume) was 18% in the first half, up from 2% in the same 2016 period.
For the six months ended June 30, the company had overall revenue of £10.6 million ($13.9 million), up 18.5% year over year.
Its net loss after tax was £619,000 ($810,000), down from £1.3 million. At the EBITDA level, profit was £1.4 million ($1.8 million) compared to $900,000 in H1 2016.
While I still stubbornly think of CentralNic as primarily a registry play, in fact the company now gets about three quarters of its revenue today from its retail registrar division, which contributed just shy of £8 million to the total in H1.
Instra, the Australian registrar it acquired at the end of 2015, contributed £5.83 million.
The wholesale division, registry back-end services — contributed £1.82 million to revenue and £450,000 to EBITDA in the half.
That’s despite CentralNic being the back-end for six of the top 20 new gTLDs by volume — .website, .space, .tech, .site, .online, and .xyz
If we tally up the number of domains in only those six TLDs, we get to about 4.2 million, per their zone files.
The company’s third reporting unit, Enterprise, contributed £800,000 ($1 million) in the half, of which £360,000 ($471,000) came from premium domain sales.

Registry bosses to talk ICANN “tax cuts” at private meeting

The CEOs of 20 or more gTLD registries are due to meet privately this month to discuss, among other things, the possibility of a reduction in their ICANN fees.
The Registry CEO Summit is being held in Seattle at the end of September, I’m told.
Jay Westerdal of Top Level Spectrum (.feedback etc) and Ray King of Top Level Design (.design etc) are organizing the event.
“It’s a small, informal gathering, where the agenda will be set by the participants, most likely around best practices for running a new registry,” Westerdal said.
“It’s not an official group like the RySG, and we don’t expect to be putting out any statements or ‘work product’,” he said.
He said he expects 20 to 25 registry CEOs to attend.
.CLUB Domains CEO Colin Campbell, who said he will attend, said he intends to bring proposals to the meeting around persuading ICANN to support the industry with marketing support and fee reductions.
Campbell wants ICANN to commit to spend $4 million on marketing new gTLDs at trade shows and conferences.
He also wants ICANN to reduce its $0.25 per-domain registry fee, which he referred to as a “tax”, to $0.18 for three years (which would match the $0.18 registrars pay ICANN per transaction).
He said the money would ideally flow through into the pockets of registrants, rather than the industry.
“I’m not suggesting that it be permanent, I’m suggesting that in order to support the fledgling new gTLD industry that they offer a small reduction and hope registries will pass that on to registrars and hopefully registrars will pass that on to consumers,” Campbell said.
The reduction would also help raise awareness of new gTLDs, he said.
The $0.25 fee only kicks in when a registry tops 50,000 billable transactions per year, so the reduction would at first only affect the roughly 50 to 60 new gTLDs that are already over that milestone.
The $0.07 per-domain reduction is so small that even a registry as large as .club, with about a million domains, would only see its fees reduced by about $70,000 per year.
Over all the affected TLDs, it would come out to a cost to ICANN of about $1.2 million per year if current volumes hold.
“It’s a very small amount but I still believe the benefit goes to end users,” Campbell said.
For registrants, it’s difficult to imagine $0.07 making a huge difference, unless they’re a high-volume buyer (which are not always the buyers you want). Generally, the cheaper domains get the more they attract abusive registrants.
Whether the ideas will get any traction among other registry CEOs remains to be seen, but it’s not the first idea for reduced ICANN fees to come out of the registry community recently.
In March, the RySG formally asked ICANN to tap into its war chest of excess new gTLD application fees to waive 75% of its fixed $25,000 annual per-TLD fee, a move that would affect all new gTLDs rather than just the larger ones.
The rebate would have cost ICANN $17 million.
But ICANN knocked that idea back last week, saying it still does not know how much of this $96 million cash pile it will have to spend on unexpected events stemming from the program.

Another auDA director quit in secret

Australian ccTLD registry auDA, in the midst of a transparency controversy, reportedly lost another of its directors last month.
According to a report in Australia’s Financial Review newspaper, Leonie Walsh stepped down August 14.
The paper cited Australian Securities and Investments Commission documents as its source.
Embattled auDA did not disclose her departure at the time, despite the fact that it did disclose that fellow director Michaella Richards had also quit the same week.
Richards had been accused by some auDA members, noting her previous professional relationship with CEO Cameron Boardman, of lacking experience in the domain industry.
No reason for Walsh’s departure has been given.
The two directors left just a couple of weeks after chairman Stuart Benjamin, who was facing a member vote of no-confidence he did not think he could win, quit.
auDA has come under criticism from members, such as those organized at Grumpy.com.au, for several policy shifts that seemed to make the organization more secretive and less responsive to members’ interests.
The organization has since done U-turns on most of controversial policies.

.CLUB nears profitability, talks renewals and “trial” domains

.CLUB Domains is nearing profitability and poised to become a “growth engine”, despite the view that most of its current domains are not expected to renew, according to its CEO.
Colin Campbell told DI today that the company made $6.7 million in revenue last year, and is “very close” to breaking even.
The company reached one million domains under management milestone in June, but Campbell freely admits that the majority of its current domains are unlikely to renew.
Almost 700,000 of these domains are what .CLUB considers “trial accounts”, he said. These are domains that typically sold for under a dollar — .club has been seen for sale as low as $0.88 — to speculators.
The registry usually sees a 10% to 15% renewal rate on these domains, he said.
Of the remaining 300,000 “solid, regular registrations”, Campbell said he sees first-year renewals in the 68% to 70% range and subsequent years at 80% to 90%.
The company typically only discounts on its first-year registrations, so renewal rates are a much better indicator of performance.
He said .club has around 120,000 web sites (not including parked domains), some of which are showcased on its web site.
With this in mind, renewals are at the forefront of Campbell’s mind. He said a key performance indicator .CLUB uses is “average cost of acquisition per renewed domain”, which the company tracks on a per-registrar basis.
The company invested $3.3 million in marketing in 2016, he said. That does not include rebates to registrars participating in volume programs, but it does take into account acquiring prominent shelf space on key registrars, he said.
“We’re very close to break-even and we’re still going to be able to invest multi-million dollars in ad campaigns and marketing,” he said.
“We’re going to have a company that’s breaking even and is still going to be a growth engine,” he said. “We’re going to be able to sustain a path of growth. I don’t know too many TLDs who could say that. Of course, if you reduce your expenses down to nothing you can make a profit, but can you also be a growth engine?”
“That’s where I feel like a TLD needs to get to, to be a sustainable long-term presence in the market, like a .org or .net or .co,” he said.
Despite the narrowing losses and starkly higher volumes, the $6.7 million in 2016 revenue is a lower than the $7 million in 2015 revenue Campbell told Domain Name Wire about a year ago.
Campbell said today that the reason for the dip is that late 2015 saw many gTLDs (old and new, even including .com) benefit from a bump from the Chinese market. .CLUB’s top line was particularly exposed by some premium sales it made to Chinese investors during that growth spike.
Premium sales have also been performing well in 2017, Campbell said, driven by the financing options and broker program introduced in January.
.CLUB announced first-quarter premium sales totaling $505,000 and $2.5 million in Q2.

Afnic appoints Pierre Bonis new CEO

French ccTLD registry Afnic has named Pierre Bonis its new CEO.
Bonis officially started his new job today, but he’s been in the role on an interim basis since May 1, when he replaced Mathieu Weill.
Weill had abruptly quit after 12 years at Afnic in order to join the Digital Economy Department of the French government’s Directorate-General for Enterprise.
Bonis was Weill’s deputy for five years, so being kicked up the ladder by the Afnic board of trustees was perhaps not unexpected.

No $17 million rebate for struggling new gTLDs

ICANN has turned down a request for about $17 million to be refunded to under-performing new gTLD registries.
The organization cannot spare the cash from its $96 million new gTLD program war chest because it does not yet know how much it will need to spend in future, Global Domains Division president Akram Atallah told registries this week.
The Registries Stakeholder Group made the request for fee relief back in March, arguing that the $25,000 per-TLD fixed annual fee each registry must pay amounts to an unfair “burden” that has “hampered their success and put them at a competitive disadvantage”.
The RySG proposed that this $6,250 per quarter fee should be reduced by $4,687.50 per quarter for a year, a 75% reduction, at a cost to ICANN of $16.87 million.
The money, they said, should be drawn from the $96.1 million in new gTLD application fees that were still unspent at the time.
The new gTLD program charged each applicant $185,000 per application. About third of the fee was to cover unforeseen events, and is often sniggeringly referred to as its legal defense fund.
Because the program was meant to work only on a cost-recovery basis, there are question marks hanging over what ICANN should ultimately do with whatever cash is left over.
(It should be noted that this cash is separate from and does not include the quarter-billion dollars ICANN has squirreled away from its new gTLD last-resort auctions).
Now that the vast majority of the 2012 round’s 1,930 applications have been fully processed, it must have seemed like a good time for the RySG to ask for some cashback, but ICANN has declined.
Atallah said in a August 29 letter (pdf) to the group that ICANN has had to spent lots of its program reserve on unanticipated projects such as name collisions, universal acceptance, the EBERO program and the Trademark Clearinghouse. He wrote:

We do not yet know how much of the New gTLD Program remaining funds will be required to address future unanticipated expenses, and by when. As such, at this time, ICANN is not in a position to commit to the dispensation of any potential remaining funds from the New gTLD Program applications fees.

It seems for now the hundreds of new gTLDs with far fewer than 10,000 registrations in their zones are going to keep having to fork over $25,000 a year for the privilege.