ICANN heads to Mar-a-Lago for budget crisis talks

Cash-strapped ICANN has invited select community members to emergency budget talks at the Mar-a-Lago resort in Florida, DI has learned.
The three-day summit next week will address how best to spend the organization’s $138 million annual budget, along with its $236 million auction proceeds war chest and its $80 million of leftover new gTLD application fees.
“Recent public comments have made it clear than many valued ICANN community members have misunderstood our FY19 budget,” CEO Goran Marby said. “I believe a long weekend of intensive discussions at Mar-a-Lago should persuade the community that we’re actually on the right track.”
To encourage participation from an increasingly weary volunteer pool, attendees will be treated to complimentary spa treatments, golfing, and the most beautiful pieces of chocolate cake, he said.
DI has managed to obtain a preliminary agenda for the summit, which can be read here (pdf).
Business-class flights and three nights’ accommodation at the exclusive members club will be covered by ICANN.
Mar-a-Lago, purchased by Donald Trump in the 1980s, is a “six-star” resort in Palm Beach, Florida. It was originally a five-star hotel, until 2004 when Trump purchased the one-star hotel next door and knocked through.
Marby defended the choice of venue, pointing out that the guest list is to be strictly limited to the ICANN board of directors, industry CEOs, and members of the Intellectual Property Constituency.
DI understands that the IPC will be permitted to invite members of the Non-Commercial Stakeholder Group to attend, should they require golf caddies.
To ensure gender diversity, all attendees will be able to bring along their spouses or partners. ICANN will make up any shortfall by hiring decorative females from a pool of Trump litigants.
A small support team of 50 ICANN staffers will also be available to hand out fresh towels, collect empty glasses, and so on.
Remote participation will be available via AOL Instant Messenger.
Chief financial officer Xavier Calvez declined to disclose the cost of the summit, citing privacy concerns caused by “GDPR or something”, but DI understands it is to be accounted for as a line item in ICANN’s Federal lobbying disclosure.
Calvez said ICANN has managed to negotiate “substantial” bulk discounts on the usual $200,000 Mar-a-Lago membership fees and $2,000-a-night room rates.
The cost will also be offset by sponsorship contributions from ICANNwiki and the National Rifle Association, he said.
Registry and registrar CEOs polled by DI this weekend were split on whether they would attend.
“Of course I’m going,” Blacknight CEO Michele Neylon told us by phone from an airport lounge in Kigali.
But .xyz chief Daniel Negari said he would attend only if he can secure sufficient funding for his bus fare to the airport.
Among the cost-cutting proposals on the menu, DI understands, is a request to consolidate all current and future policy working groups into a single, unified WG.
Sources say this would have the added benefit of reducing the annual policy implementation budget to zero dollars between now and, at the earliest, 2045.

Cybersquatting cases up because of .com

The World Intellectual Property Organization handled cybersquatting cases covering almost a thousand extra domain names in 2017 over the previous year, but almost all of the growth came from complaints about .com names, according to the latest WIPO stats.
There were 3,074 UDRP cases filed with WIPO in 2017, up about 1.2% from the 3,036 cases heard in 2016, WIPO said in its annual roundup last week.
That’s slower growth than 2016, which saw a 10% increase in cases over the previous year.
But the number domains complained about in UDRP was up more sharply — 6,370 domains versus 5,374 in 2016.

WIPO said that 12% of its 2017 cases covered domains registered in new gTLDs, down from 16% in 2016.
If you drill into its numbers, you see that 3,997 .com domains were complained about in 2017, up by 862 domains or 27% from the 3,135 seen in 2016.
.com accounted for 66% of UDRP’d domains in 2016 and 70% in 2017. The top four domains in WIPO’s table are all legacy gTLDs.
As usual when looking at stats for basically anything in the domain business in the last few years, the tumescent rise and meteoric fall of .xyz and .top have a lot to say about the numbers.
In 2016, they accounted for 321 and 153 of WIPO’s UDRP domains respectively, but they were down to 66 and 24 domains in 2017.
Instead, three Radix TLDs — .store, .site and .online — took the honors as the most complained-about new gTLDs, with 98, 79, and 74 domains respectively. Each of those three TLDs saw dozens more complained-about domains in 2017 than in 2016.
As usual, interpreting WIPO’s annual numbers requires caution for a number of reasons, among them: WIPO is not the only dispute resolution provider to handle UDRP cases, rises and falls in UDRP filings do not necessarily equate to rises and falls in cybersquatting, and comparisons between .com and new gTLDs do not take into account that new gTLDs also have the URS as an alternative dispute mechanism.

CentralNic and KeyDrive in merger talks

CentralNic and KeyDrive, two major European domain firms, are in merger talks, CentralNic confirmed this morning.
CentralNic said that the transaction, should it close, would be a “reverse takeover” of itself by KeyDrive.
That’s where a private company, in this case KeyDrive, reverses into a public one, in this case AIM-listed CentralNic.
Luxembourg-based KeyDrive is the holding company for brands including the registrars Key-Systems, Moniker and BrandShelter and the registries OpenRegistry and KSRegistry.
London-based CentralNic is a registry provider for the likes of .xyz, recent acquirer of Slovakian TLD .sk, and owner of registrars Internet.bs and Instra.
CentralNic said: “CentralNic and KeyDrive Group believe that the combination of the two businesses would have strong strategic logic and economies of scale, and would represent an opportunity to create a group with advanced technology platforms delivering significant recurring revenues for every major customer type within the industry.”
If a deal should be struck, it would happen in the second quarter, the company said.
The announcement was made today after news of the talks leaked.
Trading in CentralNic shares has been temporarily suspended.

Industry report show slightly stronger growth than Verisign’s

The latest domain name industry growth figures from CENTR show slightly better performance than a recent report from Verisign covering the same period.
CENTR says in its latest DomainWire Global TLD Report there were 331.1 million registered domains at the end of 2017, whereas Verisign, in its Domain Name Industry Brief last month, put that at 332.4 million domains.
But CENTR’s figures show growth of 1.2% compared to the end of 2016, a figure Verisign put at 0.9%.
The CENTR report shows growth in ccTLDs offset by a 0.4% decline in gTLD registrations. The drag factors for gTLDs were largely .net, .xyz and .top.
CENTR and Verisign use mostly the same sources for their data — published zone files for gTLDs and cooperative ccTLDs, and independent researcher Zooknic to plug the gaps — but they vary in how they calculate their growth numbers.
For example, Verisign said .com ended the year with 131.9 million names, but CENTR puts that number at 130.4 million. It looks to me like Verisign counts registered domains that do not appear in the .com zone file to get to its total.
In addition, CENTR excludes dot-brand gTLDs, gTLDs with fewer than 500 domains, and ccTLDs that do not provide reliable quarter-to-quarter data from its calculations.
The CENTR report can be downloaded here.

Domain universe grows almost 1% in 2017 despite new gTLD slump

The total number of registered domain names in all TLDs was up 0.9% in 2017, despite a third-quarter dip, according to the latest data compiled by Verisign.
The latest Domain Name Industry Brief, published yesterday, shows that there were 332.4 million domains registered at the end of the year.
That’s up by 1.7 million names (0.5%) on the third quarter and up 3.1 million names (0.9%) on 2016.
Growth is growth, but when you consider that 2015-2016 growth was 6.8%, under 1% appears feeble.
The drag factors in 2017 were of course the 2012-round new gTLDs and Verisign’s own .net, offset by increases in .com and ccTLDs.
New gTLD domains were 20.6 million at the end of the year, down by about 500,000 compared to the third quarter and five million names compared to 2016.
As a percentage of overall registrations, new gTLDs dropped from 7.8% at the end of 2016 to 6.2%.
The top 10 new gTLDs now account for under 50% of new gTLD regs for the first time.
The numbers were primarily affected by big declines in high-volume spaces such as .xyz, which caused the domain universe to actually shrink in Q3.
Verisign’s own .com fared better, as usual, with .net suffering a decline.
The year ended with 131.9 million .com names, up by five million names on the year, exactly offsetting the shrinkage in new gTLDs.
But .net ended up with 14.5 million names, a 800,000 drop on 2016.
In the ccTLD world, total regs were up 1.4 million (1%) quarterly and 3.4 million (2.4%) annually.
Excluding wild-card ccTLD .tk, which never deletes domains and for which data for 2017 was not available to Verisign, the growth was a more modest 0.7 million (0.5%) quarterly and 2.3 million (1.8%) annually.
The DNIB report for Q4 2017 can be downloaded here (pdf).

Active new gTLD domains drop below 20 million

The number of domain names recorded in new gTLD zone files has dipped below 20 million for the first time in 18 months.
The total crossed the milestone in the wrong direction January 1, according to DI’s records.
As of today, there are 19.8 million domains in zone files, down from a peak of 26 million in March 2017.
The count has gone down by about half a million names in the last 90 days, largely as a result of declines in .top, .xyz and .kiwi, which have each recorded six-figure losses.
It’s the first time that the zone files have showed the number of domains going below 20 million since the beginning of June 2016, when XYZ.com sold millions of .xyz domains for a penny each. Most of those names did not renew a year later.
Zone files do not record every domain that has been registered, just those with active name servers. Others may be registered but unused or on hold for various reasons.

SpamHaus ranks most-botted TLDs and registrars

Namecheap and Uniregistry have emerged as two of the most-abused domain name companies, using statistics on botnet command and control centers released by SpamHaus this week.
SpamHaus data shows that over a quarter of all botnet C&Cs found during the year were using NameCheap as their registrar.
It also shows that almost 1% of domains registered in Uniregistry’s .click are used as C&Cs.
The spam-fighting outfit said it discovered “almost 50,000” domains in 2017 that were registered for the purpose of controlling botnets.
Comparable data for 2016 was not published a year ago, but if you go back a few years, SpamHaus reported that there were just 3,793 such domains in 2014.
Neither number includes compromised domains or free subdomains.
The TLD with the most botnet abuse was of course .com, with 14,218 domains used as C&C servers. It was followed by Directi’s .pw (8,587) and Afilias’ .info (3,707).
When taking into account the relative size of the TLDs, SpamHaus fingered Russian ccTLD .ru as the “most heavily abused” TLD, but its numbers don’t ring true to me.
With 1,370 botnet controllers and about five and a half million domains, .ru’s abused domains would be around 0.03%.
But if you look at .click, with 1,256 botnet C&Cs and 131,000 domains (as of September), that number is very close to 1%. When it comes to botnets, that’s a high number.
In fact, using SpamHaus numbers and September registry reports of total domains under management, it seems that .work, .space, .website, .top, .pro, .biz, .info, .xyz, .bid and .online all have higher levels of botnet abuse than .ru, though in absolute numbers some have fewer abused domains.
In terms of registrars, Namecheap was the runaway loser, with a whopping 11,878 domains used to control botnets.
While SpamHaus acknowledges that the size of the registrar has a bearing on abuse levels, it’s worth noting that GoDaddy — by far the biggest registrar, but well-staffed with over-zealous abuse guys — does not even feature on the top 20 list here.
SpamHaus wrote:

While the total numbers of botnet domains at the registrar might appear large, the registrar does not necessarily support cybercriminals. Registrars simply can’t detect all fraudulent registrations or registrations of domains for criminal use before those domains go live. The “life span” of criminal domains on legitimate, well-run, registrars tends to be quite short.
However, other much smaller registrars that you might never have heard of (like Shinjiru or WebNic) appear on this same list. Several of these registrars have an extremely high proportion of cybercrime domains registered through them. Like ISPs with high numbers of botnet controllers, these registrars usually have no or limited abuse staff, poor abuse detection processes, and some either do not or cannot accept takedown requests except by a legal order from the local government or a local court.

The SpamHaus report, which you can read here, concludes with a call for registries and registrars to take more action to shut down repeat offenders, saying it is “embarrassing” that some registrars allow perpetrators to register domains for abuse over and over and over again.

.club is the bestest new gTLD, .club survey finds

.CLUB Domains has published the results of some research it commissioned into media mentions of new gTLDs that show .club coming out on top.
It’s an interesting new way to compare the relative success of new gTLDs based on usage or eyeballs rather than registration volumes, even if the report has its flaws.
In a blog post, .CLUB chief marketing officer Jeff Sass wrote:

A business will invest their time and money to incorporate a domain name that they trust and value. Their domain becomes an active component of their branding, marketing, and PR activities.
When the press or media picks up announcements and/or writes articles about these businesses, the domain name typically gets mentioned in the articles and press releases. This leads to further awareness, familiarity, and trust built around the domain name extensions that are mentioned most frequently in the press.

The registry paid Meltwater, a media monitoring company, to dig up all the media references to domains using any of the top 10 largest new gTLDs over the first half of the year.
It found that .club had the most mentions both empirically and adjusted for TLD size, and that .club’s media mentions had the most positive slant.
From the report (pdf):

When tracking the number of press impressions (articles) in terms of raw numbers, the top 3 were: .CLUB, with 14,519 impressions; .XYZ, with 10,770 impressions; and .ONLINE, with 9,595 impressions. When looking at the impression data against topline registration numbers, the top 3 TLDs were: .CLUB, with 13.29 impressions for every 1,000 registrations; .ONLINE, with 12.87 impressions for every 1,000 registrations; and .SITE, with 6.55 impressions for every 1,000 registrations. As for positive sentiment, the top 3 TLDs were: .CLUB, with 4,300 articles; .ONLINE, with 2,200 articles; and .XYZ with 2,189 articles.

The definition of “article” used by Meltwater is pretty broad. It’s certainly not looking at only the mainstream media.
The survey included press releases as well as editorial, and seems to include a fair bit of user-generated content, such as posts on Medium.com and Sohu.com, too.
There’s even one “article” cited that is actually just a Kickstarter crowd-funding project page.
The survey also double-counts articles, so if a press release appears on multiple sites, or an article is syndicated to multiple publications, each appearance was counted separately.
One could argue that all of this is a fair enough way to conduct such a survey — .CLUB is looking for evidence of grassroots usage and awareness, not just of coverage by publications with rigorous editorial controls.
And the methodology also called for all articles produced by or written about the registries themselves to be disregarded, presumably reducing the number of hits per registry and the chance of the results being gamed.
But a lot of the 30 articles cited directly in the Meltwater report, particularly those coming out of China, appear to be rather spammy. Others are just odd. Others offer negative views of specific new gTLD domains.
One of them is an inexplicable Chinese translation of a warning about a UK company using a .loan domain to scam people, for example.
Another is a BuzzFeed article from Japan about a fake news site using a .xyz domain to target Koreans.
Other references are so minor that even though Meltwater’s spiders spotted them I doubt many human beings would.
One of .club’s big hits is just a tiny photo credit on an stock image used in a forgettable BuzzFeed listicle, another is the Daily Mail quoting an Instagram post by an American athlete who uses a .club domain in a hashtag, the third is a self-promotional blog post on Medium.com by the owner of minicomic.club.
If these are the most prominent citations Meltwater could dig up over six months, these new gTLDs still have a way to go in terms of awareness.
But my main issue with the research is that it was limited to the top 10 new gTLDs by registration volume: .xyz, .top, .loan, .club, .win, .online, .vip, .wang, .site and .bid.
As we all know by now, there’s a correlation (at least anecdotally) between volume, low price and low quality usage/abuse.
I’d love to see subsequent reports of this nature delve into smaller TLDs, including dot-brands, that may not have as many sales but may have greater engagement and more press coverage.
The full .CLUB/Meltwater report can be found here (pdf).

XYZ junk drop sinks the industry in Q3

The total number of domains registered in the world suffered a rare period of decline in the third quarter, according to Verisign’s latest numbers.
The Q3 Domain Name Industry Brief shows September ended with 330.7 million registered names across all TLDs, a 1.2 million dip on the second quarter.
Year-on-year, there was still growth: 3.7 million domains, or 1.1%.
The shrinkage follows a flat Q2 and a slowing Q1.
The finger of blame can be primarily pointed at .xyz and .top, which lost millions of domains in the quarter due, in .xyz’s case at least, to the expiration of millions of names that had been sold for a penny or two a year earlier.
Not that you’d know this from the DNIB (pdf). For some reason Verisign doesn’t like talking about new gTLD growth rates in its reports, even when they’re going the wrong way.
Verisign’s own .com and .net grew by 1.5 million names to 145.8 million, putting ground between themselves and ccTLDs, which collectively were up by 500,000 names or 0.3% sequentially to 144.7 million.

Numeric .xyz names plummet despite dollar deal

XYZ.com’s effort to sell over a billion numeric .xyz domains at just $0.65 each does not appear to be gaining traction.
The number of qualifying domains in the .xyz zone file has plummeted by almost 200,000 since the deal was introduced and dipped by over 4,000 since the blanket discount went live.
The $0.65 registry fee applies to what XYZ calls the “1.111B Class” of domains — all 1.111 billion possible six, seven, eight and nine-digit numeric .xyz domains.
These domains carry a recommended retail price of $0.99.
It’s not a promotional price. It’s permanent and also applies to renewals.
Some registrars opted to start offering the lower price from June 1, but it did not come into effect automatically for all .xyz registrars until November 11
The number of domains in this class seems to be on a downward trend, regardless.
There were 272,589 such domains May 31, according to my analysis of .xyz zone files, but that was down to 74,864 on December 5.
On November 10, the day before the pricing became uniform, there were 78,256 such domains. That shows a decline of over 4,000 domains over the last four weeks.
It’s possible that the 1.111B offer is attracting registrants, but that their positive impact on the numbers is being drowned out by unrelated negative factors.
The period of the 200,000-name decline coincides with the massive mid-July junk drop, in which .xyz lost over half of its total active domains due to the expiration of domains registered for just a penny or two in mid-2015.
Many of those penny domains were numeric, due to interest from speculators from China, where such names have currency.
The period also coincides with a time in which XYZ was prohibited from selling via Chinese registrars, due to a problem changing its Real Names Verification provider.
In recent marketing, XYZ has highlighted some interesting uses of 1.111B domains, including a partnership with blockchain cryptocurrency Ethereum.
Other registrants are using the domains to match important dates and autonomous system numbers.