Google scuppers Team Internet acquisition after profit warning

A Norwegian private equity company has dropped its plans to acquire Team Internet after Google changed the way it handles advertising on parked domains, a key source of revenue for the company.

Oslo-based Verdane had a deadline of today to announce a formal offer for the company, but instead said it “does not intend to make an offer” because “there has been a material change of circumstances”.

While Verdane did not elaborate, there was a simultaneous announcement from Team Internet that Google’s recently announced changes to AdSense for Domains present a “challenge” that will harm its business faster than it can adapt.

Google said last week that as of March 19 it will start opting its advertisers out of AFD, the service domainers and registrars use to monetize many parked domain names. Advertisers will be able to opt back in, but are not expected to do so en masse.

Team Internet’s Search reporting unit made $72 million of its $91 million net revenue from AFD last year, which it expects to decline following the changes.

The company said it plans to instead monetize its domains using Google’s newer Related Search On Content product, which shows Google search results including paid results on the publishers’ own sites, based on the content of the page.

That presumably means Team Internet is going to have to populate its domains with spammy, low-quality and presumably AI-generated content, in order to trigger the RSOC contextual algorithm. Thanks, Google!

“The market development has been long-anticipated, though the announced acceleration is a challenge,” Team Internet told investors.

“It is anticipated that, during this transition period, contributions from AFD will decline faster than contributions from RSOC appreciate, meaning that the financial performance of Team Internet’s Search segment will see a trough in 2025 before it recovers from 2026 onwards and returns to the long-term pattern,” it added.

It expects adjusted EBITDA to more than halve for the year in its Search segment, from $57 million last year to between $20 million and $25 million this year. The company said its domains business, which includes its registry and registrars, should be unaffected.

But that domains business seems to be still up for sale. Team Internet said it has received “repeated approaches” for the domains unit and is carrying out a “comprehensive review of its asset ownership”.

Squarespace gets sweetened $7.2 billion takeover offer

Squarespace looks set to be acquired by private equity firm Permira in a sweetened cash deal valuing the registrar at about $7.2 billion.

The new $46.50 per share offer is an improvement over Permira’s initial May offer of $44 and represents a 36.4% premium over Squarespace’s share price the day before the takeover way announced.

Squarespace said the deal, which values the company at about $300 million more than the May offer, has been approved by an independent committee of its board of directors and is Permira’s “best and final” offer.

Squarespace has about 10 million gTLD domains under management across two ICANN accreditations, one of which is the old Google Domains, but is perhaps best known for its web site building services.

The company has previously said that going private will help it compete better in the small business online presence market, where it sees its competition as the likes of GoDaddy and Wix.

Team Internet spends $41 million on content farm

Team Internet is back in acquisition mode, saying this morning it has picked up an Israeli content farm business for $41.8 million.

It’s bought Shinez IO, based in Tel Aviv and Denver, for the initial sum plus a potential extra $12.3 million if the company meets certain financial targets over the next two years, the company said.

Shinez operates a network of lightweight blogs covering areas such as food and fashion, which are marketed via social media and monetized via multiple ad networks.

It’s a lucrative business — Team Internet says Shinez had revenue of $111 million, $17.2 million in net revenue, and $10.4 million of EBITDA in 2023.

The acquisition edges Team Internet, formerly CentralNic, ever closer to becoming a billion-dollar company. It now expects revenue for 2023 to work out at $948 million.

The deal also seems to mean reduced exposure to Google as the company’s number one ad revenue source. Team Internet said “this acquisition would more than double the Online Marketing segment’s revenue generated independently of our Tier 1 channel partner”.

Epik gets acquired again! The plot thickens…

Epik has announced that it has been acquired and has named at least one person responsible for running the troubled registrar, but the new information is unlikely to satisfy critics or quash the conspiracy theories around the company’s new management.

“Registered Agents Inc., the leading registered agent service provider in the United States, has acquired key assets of internet domain registrar Epik,” the company said in a press release this weekend.

Bryce Myrvang, in-house counsel for Registered Agents, is named in the press release, but his position at Epik is not stated. Neither is it stated when the acquisition occurred — whether it was before or after ICANN approved the transfer of disgraced Epik Inc’s accreditation to Epik LLC last week, or after.

Neither the names Registered Agents or Bryce Myrvang are new information. Myrvang had been listed in ICANN’s registrar contact database after the LLC bought the Inc last June, but that changed last month to a job title rather than a named individual.

Because Registered Agents’ entire raison d’être is anonymous company formation and management, Epik’s past and current customers naturally wondered aloud whether it was in fact just a front for company founder Rob Monster, on whose watch the registrar started to descend into financial controversy, or somebody else with an interest in keeping their name secret.

But last week Epik and ICANN simultaneously announced that ICANN had completed its due diligence on the new company and found it completely independent of its former owners and leadership.

“Epik, LLC is a recently formed entity that is completely independent of Epik, Inc., its leadership, and shareholders,” ICANN told us.

“No previous owners, including Epik Inc founder Rob Monster and late stage CEO Brian Royce, are involved in Epik LLC in any capacity, including ownership interest in the business,” Epik said.

The announcement today that Registered Agents has bought Epik LLC will do little to unmuddy these waters.

For starters, if Myrvang is indeed a lawyer at a company that prides itself on its professionalism and discretion, there’s not a chance in hell he’s in charge of Epik’s Twitter account, which went a bit crazy last month.

There are undoubtedly synergies between a firm that deals in anonymous company formations — reportedly sometimes for dodgy clients — and a registrar that specialized in controversial anchor tenants.

But Epik is now confirming that it’s done a full U-turn on its strategy to court and welcome some of the web’s most distasteful sites and is now positioning itself as a regular workaday registrar with a focus on small businesses and entrepreneurs.

“Since the acquisition, and throughout the ICANN accreditation transfer review, Epik updated its terms of service and worked aggressively to rid its platform of violators. Having removed a handful of problematic clients, Epik can focus on rebuilding trust with its small business and entrepreneurial clients,” the company said in its latest press release.

Epik lost hundreds of thousands of domains under management last year, after a financial mismanagement scandal caused customers to lose confidence and flee in droves.

INCO flips a gTLD to Identity Digital

Internet Naming Co has sold one of its gTLDs to Identity Digital, barely a year after taking it from UNR.

The Registry Agreement for .juegos — Spanish for “games” — was assigned to ID subsidiary Dog Beach in early December, according to ICANN records.

ID already runs the English-language .games, while XYZ runs the singular .game. There is no singular gTLD in the Spanish.

.juegos in volume terms has been a disappointment. Originally with UNR predecessor Uniregistry, it peaked at 2,353 domains under management in 2016, when names were priced at around $20 a year.

But the gTLD was affected by Uniregistry’s decision to massively increase prices to compensate for weak volume in 2017, which caused some of the leading registrars to drop the TLDs from their storefront.

To this day, GoDaddy still does not carry .juegos, but Tucows seems to have started selling it again, at an eye-watering $500 a year. Wholesale pricing is believed to be $300 a year. Namecheap sells it for $368 a year.

.juegos had 649 domains under management at the last count. The largest registrar in Entorno, which unsurprisingly based in Spain.

INCO took over .juegos, along with a bunch of other former Uniregistry gTLDs, in late 2022.

It will be interesting to see if ID reduces prices to match .games, which is believed to wholesale at $20 a year.

XYZ adds 35th gTLD to its stable

XYZ has acquired .ceo, making its portfolio of new gTLDs now 35-strong.

XYZ, judging by a blog post and press release, seems to the sticking to the original use case of yourname.ceo, highlighting a couple of CEOs that are using .ceo as their primary domain. But it seems that many of the .ceo domains with Google juice are generics.

The former registry was CEOTLD of Australia, originally affiliated with social media wannabe PeopleBrowsr.

When the gTLD launched a decade ago the plan was to issue registrants with their own template calling card style web sites, but the idea never really caught on.

.ceo had 3,789 domains at the end of June, according to the latest registry reports. GoDaddy and Namecheap were its largest registrars.

GoDaddy takes over .health

GoDaddy Registry has added .health to its growing stable of TLDs.

According to ICANN records, the company has taken over the contract from original registry DotHealth.

GoDaddy was already the back-end registry services provider for the gTLD, and as registrar is responsible for roughly half of the roughly 35,000 domains registered there.

Judging by ICANN documentation, GoDaddy has also acquired DotHealth.

Euro registrars merge to form Your.Online

French registrar Gandi and Dutch registrar holding group Total Webhosting Solutions have announced they have merged to form a new company, Your.Online.

The combined entity says it has a million customers, revenue of €175 million ($183 million), and 600 employees.

Your.Online will operate eight brands, mostly in hosting. Gandi will remain as an independent brand under the new corporate umbrella. The TWS brand appears to have been retired.

Financial terms of the deal between the two private companies were not disclosed.

Gandi founder Stephan Ramoin will become the group’s non-executive chairman of the firm’s advisory board. Your.Online is helmed by Abe Bakker

I think today might be the first time in 25 years of reporting that I’ve seen the word “bullshit” in a press release.

CentralNic buys a bunch of web sites for $5.2 million

CentralNic said yesterday has splashed out $5.2 million on what it calls “a portfolio of revenue generating niche websites”.

The announcement doesn’t specify any of the “multiple” sellers or the nature of the sites, other that to say it will add $1.2 million to the top line and $1.4 million of EBITDA in 2023.

The company was already responsible for monetizing some of the sites it has bought.

CentralNic hinted that it might be slowing down its long-running acquisition spree following the departure of 13-year veteran CEO Ben Crawford last week.

The company said “it is intended that in the future, the emphasis of cashflow generated will be a more balanced approach of returns to shareholders, deleverage and complementary bolt-on acquisitions.”

The newly announced deal was presumably in the advanced stages of closure at the time of Crawford’s departure.

Melbourne IT to relaunch, return to roots, after $3.4 million acquisition

Australian registrar Webcentral.au is to revive its Melbourne IT brand with a renewed focus on the corporate domains market, following the AUD 5 million ($3.4 million) acquisition of a smaller rival.

The company said today it’s buying registrar New Domain Services and bringing its CEO, Jonathan Horne, on board as the new boss of Melbourne IT, which divested its corporate domains arm to CSCGlobal in 2013.

Webcentral now says it plans to “relaunch the Melbourne IT brand and business and pursue growth opportunities in the corporate domains services sector”, returning the company to its roots.

New Domain has revenue of AUD 2 million and EBITDA of AUD 1.2 million, with 25,000 customers, the company said.

Melbourne IT was among the first handful of registrars to be accredited by ICANN when it broke up Network Solutions’ monopoly in the late 1990s.