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59,000% revenue growth at Donuts leads to Deloitte award

Kevin Murphy, November 9, 2017, Domain Registries

Deloitte has placed new gTLD registry Donuts at the top of its 2017 Technology Fast 500, a league table of the fastest-growing North American technology firms.
Donuts won by growing its revenue by 59,093% over three years.
Given that Donuts didn’t have its first revenue-generating gTLD delegated until the final quarter of 2013, the three-year judging period basically covers almost the entire period of its existence as a trading company.
The runners up were ClassPass (46,556%, founded 2013), which gives fitness junkies a centralized way to book from multiple classes, and Toast (31,250%, founded 2012), which makes point-of-sale software for restaurants.
Companies could submit themselves for consideration on the 500-strong table. They only needed 135% growth over three years to make it to the list.
The rankings are based on revenue, not profit, so it does not necessarily mean that gTLDs are a way to get rich quick.
Still, it’s impressive that something as dated as domain names could top the rankings, given the number of transformational technologies hitting the market every year.

This is who won the .inc, .llc and .llp gTLD auctions

Kevin Murphy, October 19, 2017, Domain Registries

The winners of the auctions to run the gTLD registries for company identifiers .inc, .llc and .llp have emerged due to ICANN application withdrawals.
All three contested gTLDs had been held up for years by appeals to ICANN by Dot Registry — an applicant with the support of US states attorneys general — but went to private auction in September after the company gave up its protests for reasons its CEO doesn’t so far want to talk about.
The only auction won by Dot Registry was .llp. That stands for Limited Liability Partnership, a legal construct most often used by law firms in the US and probably the least frequently used company identifier of the three.
Google was the applicant with the most cash in all three auctions, but it declined to win any of them.
.inc seems to have been won by a Hong Kong company called GTLD Limited, run by DotAsia CEO Edmon Chong. DotAsia runs .asia, the gTLD granted by ICANN in the 2003 application round.
My understanding is that the winning bid for .inc was over $15 million.
If that’s correct, my guess is that the quickest, easiest way to make that kind of money back would be to build a business model around defensive registrations at high prices, along the lines of .sucks or .feedback.
My feedback would be that that business model would suck, so I hope I’m wrong.
There were 11 original applicants for .inc, but two companies withdrew their applications years ago.
Dot Registry, Uniregisty, Afilias, GMO, MMX, Nu Dot Co, Google and Donuts stuck around for the auction but have all now withdrawn their applications, meaning they all likely shared in the lovely big prize fund.
MMX gained $2.4 million by losing the .inc and .llc auctions, according to a recent disclosure.
.llc, a US company nomenclature with more potential customers of lower net worth, went to Afilias.
Dot Registry, MMX, Donuts, LLC Registry, Top Level Design, myLLC and Google were also in the .llc auction and have since withdrawn their applications.

New gTLDs still a crappy choice for email — study

Kevin Murphy, September 28, 2017, Domain Tech

New gTLDs may not be the best choice of domain for a primary email address, judging by new research.
Over 20% of the most-popular web sites do not fully understand email addresses containing long TLDs, and Arabic email addresses are supported by fewer than one in 10 sites, a study by the Universal Acceptance Steering Group has found.
Twitter, IBM and the Financial Times are among those sites highlighted as having only partial support for today’s wide variety of possible email addresses.
Only 7% of the sites tested were able to support all types of email address.
The study, carried out by Donuts and ICANN staff, looked at 749 websites (in the top 1,000 or so as ranked by Alexa) that have forms for filling in email addresses.
On each site, seven different email addresses were input, to see whether the site would accept them as valid.
The emails used different combinations of ASCII and Unicode before the dot and mixes of internationalized domain name and ASCII at the second and top levels.
These were the results (click to enlarge or download the PDF of the report here):
IDN emails
The problem with these numbers, it seems to me, is the lack of a control. There’s no real baseline to judge the numbers against.
There’s no mention in the paper about testing addresses that use .com or decades-old ccTLDs, which would have highlighted web sites that with broken scripts that reject all emails.
But if we assume, as the paper appears to, that all the tested web sites were 100% compliant for .com domains, the scores for new gTLDs are not great.
There are currently over 800 TLDs over four characters in length, but according to the UASG research 22% of web sites will not recognize them.
There are 150 IDN TLDs, but a maximum of 30% of sites will accept them in email addresses.
When it comes to right-to-left scripts, such as Arabic, the vast majority of sites are totally hopeless.
UASG dug into the code of the tested sites when it could and found that most of them use client-side code — JavaScript processing a regular expression — to verify addresses.
A regular expression is complex bit of code that can look something like this: /^.+@(?:[^.]+\.)+(?:[^.]{2,})$
It’s not every coder’s cup of tea, but it can get the job done with minimal client-side resource overheads. Most coders, the UASG concludes, copy regex they found on a forum and maybe tweak it a bit.
This should not be shocking news to anyone. I’ve known about it since 2009 or earlier when I first started ripping code from StackOverflow.
However, the UASG seems to be have been working on the assumption that more sites are using off-the-shelf software libraries, which would have allowed the problem to be fixed in a more centralized fashion.
It concludes in its paper that much greater “awareness raising” needs to happen before universal acceptance comes closer to reality.

Hammock swings from Rightside to MarkMonitor

Kevin Murphy, September 5, 2017, Domain Registrars

Statton Hammock has joined brand protection registrar MarkMonitor as its new vice president of global policy and industry development.
He was most recently VP of business and legal affairs at Rightside, the portfolio gTLD registry that got acquired by Donuts in July. He spent four years there.
The new gig sounds like a broad brief. In a press release, MarkMonitor said Hammock will oversee “the development and execution of MarkMonitor’s global policy, thought leadership, business development and awareness strategy”.
MarkMonitor nowadays is a business of Clarivate Analytics under president Chris Veator, who started at the company in July.

MMX: three gTLDs approved for sale in Beijing

Kevin Murphy, August 31, 2017, Domain Registries

Three foreign new gTLDs have been approved for sale and resolution in Chinese capital Beijing, according to MMX.
The portfolio registry said today that its .vip is among the first to receive approval from the Beijing Communications Administration, one of China’s many regional authorities.
According to MMX, while many gTLDs have managed to pass through the Ministry of Industry and Information Technology’s stringent vetting process, the Beijing local authority has so far been slow to follow the national regulator’s lead.
But BCA approved .vip, along with GMO’s .shop and Donuts’ .ltd on August 16, the registry said in a market update.
This gives .vip national coverage in China, adding Beijing’s 22 million inhabitants.
MMX added that 188,764 different .vip sites, of the over 600,000 in its zone file, are currently indexed by Chinese search engine Baidu.
It also said that it plans to start selling Chinese-script internationalized domain names in .vip (in IDN.ascii format) in November.

EFF recommends against new gTLDs

Kevin Murphy, July 28, 2017, Domain Policy

The Electronic Frontier Foundation has recommended that domain registrants concerned about intellectual property “bullies” steer clear of new gTLDs.
The view is expressed in a new EFF report today that is particularly critical of policies in place at new gTLD portfolio registries Donuts and Radix.
The report (pdf) also expresses strong support for .onion, the pseudo-TLD available only to users of the Tor browser and routing network, which the EFF is a long-term supporter of.
The report makes TLD recommendations for “security against trademark bullies”, “security against identity theft and marketing”, “security against overseas speech regulators” and “security against copyright bullies”.
It notes that no one TLD is “best” on all counts, so presents a table explaining which TLD registries — a broad mix of the most popular gTLD and ccTLD registries — have which relevant policies.
For those afraid of trademark “bullies”, the EFF recommends against 2012-round new gTLDs on the basis that they all have the Uniform Rapid Suspension service. It singles out Donuts for special concern due to its Domain Protected Marks List, which adds an extra layer of protection for trademark owners.
On copyright, the report singles out Donuts and Radix for their respective “trusted notifier” schemes, which give the movie and music industries a hotline to report large-scale piracy web sites.
These are both well-known EFF positions that the organization has expressed in previous publications.
On the other two issues, the report recommends examining ccTLDs for those which don’t have to kowtow to local government speech regulations or publicly accessible Whois policies.
In each of the four areas of concern, the report suggests taking a look at .onion, while acknowledging that the pseudo-gTLD would be a poor choice if you actually want people to be able to easily access your web site.
While the opinions expressed in the report may not be surprising, the research that has gone into comparing the policies of 40-odd TLD registries covering hundreds of TLDs appears on the face of it to be solid and possibly the report’s biggest draw.
You can read it here (pdf).

Donuts to complete Rightside acquisition tonight

Kevin Murphy, July 27, 2017, Domain Registries

Donuts is on the verge of closing its acquisition of coopetitor Rightside, after the vast majority of Rightside shareholders agreed to sell up.
Rightside just disclosed that owners of 92% of its shares — 17,740,054 shares — have agreed to sell at Donuts’ offer price of $10.60 per share.
That means the remaining 8% of shares that were not tendered will be converted into the right to receive $10.60 and Donuts can close the acquisition before the Nasdaq opens tomorrow morning.
After the $213 million deal closes, Rightside will become a wholly owned subsidiary of Donuts and Donuts can get on with implementing whatever efficiencies it has identified.
Rightside will cease to be publicly listed afterwards.
Together the combined company will be the registry for about 240 new gTLDs, as well as owning its own back-end registry infrastructure and the retail registrar Name.com.

ICANN gives the nod to Donuts-Rightside merger

Kevin Murphy, July 17, 2017, Domain Registries

ICANN has given its consent to the acquisition of Rightside by rival new gTLD registry Donuts, according to the companies.
The nod means that one barrier to the $213 million deal has been lifted.
Rightside, which is listed on Nasdaq, still needs the majority of its shareholders to agree to the deal and to satisfy other customary closing conditions.
ICANN approval does not mean the organization has passed any judgment about whether the deal is pro-competition or anything like that, it just means it’s checked that the buyer has the funds and the nous to run the TLDs in question and is compliant with various policies.
All new gTLD Registry Agreements given ICANN the right to consent — or not — to the contract being assigned to a third party.
The acquisition was announced last month at the end of a turbulent year or so for Rightside.

Donuts to pay $213 million for Rightside

Kevin Murphy, June 14, 2017, Domain Registries

Donuts is to acquire Rightside for $213 million, the companies have just announced.
The $10.60 per share cash offer represents a 12% premium over Rightside’s average closing share price over the last 30 days. Rightside’s 52-week high is over $12.
Just one year ago, Donuts offered $70 million for Rightside’s portfolio of gTLDs, but was shot down.
Rightside also turned down a $5 million offer for four gTLDs from XYZ.com in April 2016.
The $213 million offer is funded at least partly by Silicon Valley Bank, which is providing a credit facility to Donuts.
Assuming the deal closes — which will require the holders of more than half its shares to agree to the price — it will make Rightside a private company once more, as a wholly owned Donuts subsidiary.
The two gTLD registries are already partners, with Rightside providing domain registry services for Donuts’ roughly 200 new gTLDs.
There was talk of a split last year, with Donuts apparent endorsement of Google’s Nomulus platform, but the two companies reaffirmed their relationship earlier this year.
Rightside itself has a portfolio of 40 gTLDs, but it’s faced criticism from shareholders over the last year or so over their relatively poor performance.
Activist investor J Carlo Cannell, who owns almost 9% of Rightside, has been pressuring the company’s board to take radical action for the last 15 months.
Earlier this year, Rightside got out of the once-core wholesale registrar game by selling eNom to rival Tucows for $83.5 million.

More change at the top at Donuts as Tindal steps down

Kevin Murphy, May 3, 2017, Domain Registries

Donuts has lost co-founder and COO Richard Tindal, who has announced his retirement.
Tindal was one of the four domain industry executives who founded Donuts in order to take advantage of ICANN’s new gTLD program about seven years ago.
No reason was given for his departure, which was announced in a blog post, beyond “retirement”.
Co-founders Paul Stahura, Jon Nevett and Dan Schindler are all still with the company, but founding CEO Stahura recently stepped into the chairman’s role to give venture capitalist Bruce Jaffe the corner office.
Tindal had previously worked in senior roles for Verisign, Neustar and Demand Media (now Rightside).