Tucows buys UNR’s registry business as Schilling bows out
Tucows has acquired UNR’s registry business, the latest in the piecemeal sale of the old Uniregistry by founder Frank Schilling.
The Canadian registrar said it is taking on the technology platform as well as 10 UNR staffers.
Not many details of the deal, not even the purchase price, have been revealed.
“While I am slowly getting out of the industry, it’s important to me to know that my businesses are being left in the best hands,” Schilling said in a brief Tucows press release.
The deal gives Tucows a registry component to match rival GoDaddy, which acquired Neustar’s registry business last year, and makes the company the latest to throw itself into the vertically integrated domain space.
GoDaddy acquired Uniregistry’s registrar business last year also.
The UNR registry was originally Internet Systems Consortium’s but was acquired by UNR towards the beginning of the current new gTLD cycle.
It’s not currently clear which TLDs, if any, continue to run on the UNR platform. The company auctioned off 20 gTLDs in May, making $40 million, but did not disclose the buyers and none of the ICANN contracts have yet changed hands.
Certain ICANN approvals are needed before the deal closes, Tucows said.
Neither company answered DI’s questions about which TLDs are making the move, but Tucows VP Dave Woroch told us:
We are purchasing their registry platform and technology/intellectual property. In addition to servicing a number of registry operators, this platform will be applicable or beneficial to our broader registrar business, and we are looking at how we can implement some of that technology into our registrar platform. Along with this purchase of the registry platform, we have the unique opportunity to bring on a very experienced team of software engineers with specific expertise, and that will benefit our domain business at a time when it has been particularly challenging to add talent…
Tucows will be actively marketing itself as a backend registry provider, both for gTLDs and ccTLDs, and if there is another round of new gTLDs, we would fully expect to participate there as well.
CentralNic spends $6.5 million on traffic network
CentralNic this morning said it has paid $6.5 million to acquire “a publishing network of revenue generating websites”.
The company, which is seeing an increasingly large chunk of its revenue coming from domain monetization, said the network generates $2 million in annual revenue and $1.5 million in earnings.
The seller is White & Case, a 120-year-old international law firm, not exactly the kind of company you’d expect to own a bunch of random monetized domains.
Neither the size of the network nor the means of monetization were disclosed.
CentralNic said the network was already a customer for roughly half of its sites, so the acquisition will add about $1 million to revenue and $1.5 million to earnings, reducing annual cost of revenue by about $500,000.
While the company is best know for selling domain names, following recent acquisitions revenue from its fast-growing “online marketing” segment outpaced its traditional revenue sources, bringing in $96.4 million in the first half compared to $78.3 million in it two domain-related segments.
Nothing but losses ahead for MMX
Former new gTLD registry MMX has delivered its latest set of financial results and warned that, without any operating business, it will be loss-making for the foreseeable future.
The company today reported a first-half loss of $783,000, compared to a loss of $1.25 million in the year-ago period.
That’s calculated from its ongoing operations, which since the $120 million sale of its registry business to GoDaddy comprises no revenue-generating activities but substantial costs keeping the company running and maintaining its listing on the AIM stock market.
Profit from discontinued operations was $3.38 million, compared to $2.68 million.
It still has small “RSP” business, providing non-technical back-office management services to a few former gTLD partners, but this will be wound down or sold off.
CEO Tony Farrow said in a statement:
We are now in the process of delivering the transition services agreed with GoDaddy Registry and disposing of, or otherwise winding down, our RSP Business. Whilst the transition services are being provided on a cost recovery basis, the Company’s ongoing administrative and other public company costs will result in operating losses for the Group going forward.
When the winding down of existing businesses is done, MMX will look for acquisition opportunities or act as a vessel for a reverse takeover.
It’s currently returning $80 million of its GoDaddy cash to investors with a buyback, but this is not enough to clear all of its shares.
NameSilo says it’s growing too fast to be acquired
NameSilo Technologies has called off talks to sell its registrar, also called NameSilo, saying the company is growing too fast to exit right now.
The Canadian company grew its domains under management by 578,000 between April 2020 and April this year, when it stood at 3.9 million domains. It says it has since crossed 4.3 million.
The prospective deal, with Dutch acquisition vehicle WGH Holdings was announced last December.
But NameSilo’s CEO Paul Andreola said in a press release:
We believe that the value of Namesilo has grown significantly since the discussions with the prospective buyer began and feel that there is more value to be unlocked over the near to medium term for shareholders.
At the same time, the company reported revenue of $8.4 million for the second quarter, up $900,000 on the same period last year, with adjusted EBITDA of $435,344.
Bookings were up to $9.9 million from $7.6 million.
It was the company’s debt that first spurred acquisition talks. NameSilo says that debt has been reduced from $4.7 million to $3.85 million since March.
MMX drops two registrars
MMX has dumped two registrar contracts with ICANN, as the company’s asset-sale to GoDaddy nears completion.
ICANN records show that Minds and Machines LLC and Minds and Machines Registrar UK Limited both entered “terminated” status over the last few days, meaning they’re no longer accredited to sell gTLD domains.
But they weren’t doing any selling of domains anyway. The UK company had 108 domains under management and the US on had none at the last count.
The US accreditation was the one used primarily by the company under its original business model of a “triple-play” registry/registrar/back-end, when it was still going by Minds + Machines, which was abandoned five years ago.
The registrar peaked at about 50,000 names, which were then transferred over to Uniregistry. The back-end business was also abandoned, with Nominet taking over technical management of most of its gTLDs.
MMX is currently in the process of getting out of its sole remaining third business, that of gTLD registry.
GoDaddy has already taken over most of its 27 gTLDs under a $120 million deal announced earlier this year. Four TLDs remain, and will be transferred subject to approval from government partners.
GoDaddy and MMX delay closure of $120 million gTLD deal
GoDaddy and MMX have extended the deadline for final closure of their $120 million gTLD acquisition deal by a couple weeks.
MMX said this week the delay is to give them more time to seek approvals from business partners in the four gTLDs that have not already made the move, believed to be .bayern, .boston, .miami and .nrw.
These are all geographic strings that require local government sign-off to complete the transfers.
The deadline had been August 7. It’s now August 23.
GoDaddy Registry has already taken control of 23 of MMX’s gTLDS.
MMX gets nod to sell 22 gTLDs to GoDaddy
New gTLD registry MMX expects to shortly offload most of its portfolio of strings to GoDaddy Registry after receiving ICANN approvals.
The company said today that its transfer requests for four of its gTLD contracts have received full ICANN approval.
Another 18 have received conditional ICANN approval, and MMX believes it has met these unspecified conditions.
Another five of its stable that are not fully owned and operated still require the nod from its partners.
MMX said in April that it planned to sell its entire portfolio to GoDaddy, after which it is expected the company will be wound down.
The company did not break down which transfer have received full approval, conditional approval, or are still waiting for approval.
It gTLDs are: .cooking, .fishing, .horse, .miami, .rodeo, .vodka, .beer, .luxe, .surf, .nrw, .work, .budapest, .casa, .abogado, .wedding, .yoga, .fashion, .garden, .fit, .vip, .dds, .xxx, .porn, .adult, .sex, .boston, .london and .bayern.
ICANN throws out another challenge to the Donuts-Afilias deal
ICANN is set to reject a plea for it to reconsider its decision to allow Donuts to buy Afilias last December.
Its Board Accountability Mechanisms Committee recently threw out a Request for Reconsideration filed by Dot Hotel and Domain Venture Partners, part of a multi-pronged assault on the outcome of the .hotel gTLD contention set.
The RfR was “summarily dismissed”, an infrequently used way of disposing of such requests without considering their merits. BAMC concluded that the requestors had failed to sufficiently state how they’d been harmed by ICANN’s decision, and therefore lacked standing.
The requestors, both applicants for .hotel, had said that they were harmed by the fact that Donuts now owns two applications for .hotel — its own open, commercial one and Afilias’ successful community-based one.
It also said that ICANN’s seemingly deliberate opacity when it came to approving the deal broke its bylaws and sowed confusion and risk in the registry industry.
At some point before the December 17 board meeting that approved the acquisition, ICANN staff briefed the board on its decision to approve the deal, but no formal resolution was passed.
By exploiting this loophole, it’s not clear whether the board actually voted on the deal, and ICANN was not obliged by its bylaws to publish a rationale for the decision.
But BAMC, acting on the advice of ICANN’s lawyers, decided (pdf) that the statements of alleged harm were too vague or seemed to rely on potential future harms.
DVP and Dot Hotel are also party to a lawsuit and an Independent Review Process case against ICANN related to .hotel.
A Documentary Information Disclosure Request related to the Afilias acquisition was also thrown out in March.
BAMC’s dismissal will be rubber-stamped by ICANN’s full board at a later date.
China could block GoDaddy’s $120 million MMX swoop
GoDaddy’s proposed $120 million acquisition of essentially all the meaningful assets of portfolio gTLD player MMX will be subject to Chinese government approval, it emerged this morning.
Following GoDaddy’s bare-bones press release announcing the deal last night, this morning MMX added a whole bunch of flesh, including a list of closing conditions, in its statement to shareholders.
GoDaddy is proposing to buy essentially MMX’s entire operating business — the 28 gTLD registry agreements with ICANN, including the four porn-related strings belonging to subsidiary ICM Registry.
Not only do MMX shareholders have to approve the deal — and holders of 64% of the shares have already promised they will — but ICANN approval will be required for the registry contracts to be reassigned.
This may prove a hurdle or delay if third parties raise competition concerns, but ICANN’s pretty opaque approval process generally doesn’t frown too much on industry consolidation.
Another known unknown is China.
MMX told shareholders that it needs: “Approval of Chinese authorities for the change of control of MMX China (including change of control in respect of relevant licenses held by MMX China permitting it to distribute TLDs in China).”
The reason for this is quite straightforward: in volume terms, quite a lot of MMX’s business has been in China in recent years. Popular sellers such as .vip, with over 800,000 names today, have been driven primarily by Chinese investors.
A local presence (in this case MMX China) and approval from the Ministry of Industry and Information Technology is required to legally sell a TLD to Chinese registrants via Chinese registrars.
I’ve no particular reason to believe MIIT will withhold its approval for MMX China to move into GoDaddy’s ownership, but a failure to get the nod from China appears to be a deal-breaker.
MMX’s statement to the markets this morning also provided some clarity on what exactly it is that GoDaddy is proposing to buy.
The gTLDs to be acquired are: .vip,.nrw, .casa, .vodka, .xxx, .fit, .miami, .fishing, .porn, .beer, .surf, .boston, .adult, .yoga, .garden, .abogado, .work, .fashion, .horse, .rodeo, .sex, .wedding, .luxe, .dds, .law, .bayern, .cooking, and .country.
It seems that when Tony Farrow took over as MMX CEO last year, after his predecessor left due to an accounting snafu, he had the portfolio audited and came to the conclusion that it could expect only pretty crappy growth over the coming years.
It had banked on selling expensive defensive trademark blocks in its four porn-themed gTLDs to big brands to make up the shortfall, but then GoDaddy approached in December brandishing its rather large checkbook.
MMX reckons the deal values the company at a 92% premium over its closing share price Tuesday, and 87% and 78% premiums over its 20-day and 90-day average selling price.
.bayern, .nrw and the four porn gTLDs belong to subsidiaries that GoDaddy will acquire outright, but GoDaddy is not proposing to buy MMX itself.
Rather, MMX will likely stay alive and publicly traded long enough to redistribute its cash windfall to investors and sell or wind down about a dozen non-operating subsidiaries.
It has a transition services agreement to manage certain business functions of the registry until January next year, which sounds a bit like what fellow GoDaddy acquisition .CLUB Domains explained to me last night.
After that, London’s Alternative Investment Market rules will treat MMX as a “cash shell”, and it will either have to acquire an operating business from somewhere or make itself the subject of a reverse takeover by a company looking for a quick way to the public markets.
.CLUB CEO on selling to GoDaddy, Clubhouse, and .club’s “twerking moment”
.CLUB Domains CEO Colin Campbell says he’s planning to continue to promote the .club gTLD long after its acquisition by GoDaddy Registry, announced earlier today, closes.
The deal was one of several announced last night by GoDaddy, the highlight being the $120 million purchase of MMX’s portfolio of 28 gTLD contracts.
While the price of the .club deal was not disclosed, Campbell confirmed that it’s a contract reassignment rather than a purchase of the company. He’s not expecting any ICANN regulatory friction, pointing out that .club is relatively small fry in the grand scheme of things.
But .club is arguably one of the success stories of the new gTLD program.
It currently stands at over a million domains under management, recently boosted by the launch of the third-party audio conferencing app Clubhouse, which has driven demand.
“I think Clubhouse was the twerking moment for .club,” Campbell said. “It’s the moment everyone realized — holy shit this is the best domain on the market to start a community, to start a club.”
“Our volume of premium domains went up 700% in January,” he said. “We exploded.”
I understand a “twerking moment” to be a nodal point in a business’s performance so sensational that one feels obliged to stand up at one’s desk and “twerk“. I’d rather not think about it too much, to be honest.
Campbell said the volume decline .club was experiencing prior to Clubhouse launching — its zone file shrank by 200,000 names in 2020 — is misleading as a metric of measuring growth.
“We’ve always been growing,” he said. “What we’ve been doing the last few years is raising prices for the first year, so our quality of registrations is higher now than it’s ever been. Volume’s a joke… what we’re talking about is real registrations, real users. It’s all about usage.”
He was ambivalent on whether the GoDaddy deal would have happened without the Clubhouse boost.
“.club was growing very fast with real usage,” he said. “Clubhouse had nothing to do with this — in my opinion — but who knows, you’d have to ask GoDaddy.”
It seems .CLUB Domains the company will wind up eventually, but Campbell said it will continue to promote the TLD even after the deal closes in a few months.
“I will never stop supporting .club, this is part of my DNA,” Campbell said. Pressed, he said that the company will continue to operate until at least the end of the year.
But why sell his baby? Campbell said “.club was never for sale”, so it appears GoDaddy reached out to .CLUB first. But Campbell sees GoDaddy as a safe pair of hands.
“The people that run GoDaddy Registry are Nicolai [Bezsonoff], and Lori Anne [Wardi], who were the co-founders of .co and they’ve done a good job of promoting .co and I really believe that can promote .club in a similar way,” Campbell said.
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