Uniregistry will stick with risky .hiv model for now

Uniregistry has agreed to take over the new gTLD .hiv from original registry dotHIV, and said it has no plans to immediately change the business model.
“We are going to maintain the status quo, at least at the start,” said Uniregistry general counsel Bret Fausett. “We will give it a year or so on our platform and then evaluate it.”
dotHIV launched last year with what I then described as “one of the strangest and riskiest business models of any new gTLD to date.”
It’s a not-for-profit TLD with an optional “Click-Counter” service that makes microdonations, pulled from reg fees, to HIV/AIDS charities whenever somebody visits a .hiv web site.
The idea hasn’t really caught on.
When dotHIV put its ICANN contract up for auction in April it had only 345 fee-paying registrations and total revenue was $83,000.
The auction, which made it plain that the buyer would not be allowed to make a profit, failed to meet the $200,000 reserve.
Uniregistry said in a press release that while it is a for-profit company, it will continue to run .hiv as a “social enterprise”.
Fausett said the gTLD’s numbers could go up once it’s on Uniregistry’s platform.
“We think this will get a natural bump when it moves to our registrar channel,” he said. “We have over 175 registrars on our platform, which is 4x the current .HIV distribution channel.”

.hiv reserve set at $200,000, revenue so far $83,000

The soon-to-be-auctioned new gTLD .hiv has a reserve price of $200,000, but the registry reckons it’s worth as much as $700,000.
That’s according to auction documents provided by dotHIV Registry to DI today.
The documents also reveal that .hiv has made a profit revenue of $83,000 in its first seven months.
UPDATE: Germany-based dotHIV says now that the reference to “net income” in its prospectus was a translation error. The $83,000 refers to revenue — the top line, not the bottom line. The company intends to update its auction documents “instantly”.
Earlier today we reported that the gTLD is to go under the hammer with Innovative Auctions on June 3/4.
We reported that the gTLD had about 2,000 registrations, but it turns out that number includes about 1,700 registry-reserved names.
The actual number, as of March 31, is 410, of which 345 pay the $179 annual registry fee. Another 63 domains were given away for free to HIV charities for a three-year period.
While this generated a net income revenue of $83,000, registry CEO Carolin Silbernagl confirmed to DI that its contract with ICANN is supposed to require “all” of its profits to be donated to HIV causes.
According to the documents:

Public Interest Commitment binds the TLD to non-profit operations. All excess profit, after the deduction of all thinkable costs and investments, is to be donated to a charitable cause of the owner’s choice.
…
We have founded and built the .hiv TLD as a tool for positive social impact. To safeguard this vision, the voluntary PIC in the .hiv Registry Agreement binds the owner to invest all excess profit in the projects that support the fight against AIDS.
All this comes at no risk for the registry: Operational costs are covered first. No one expects you to donate if there is no surplus. Costs include the purchase price of the TLD in this auction.

The registry’s documents affirm that the key reason to buy .hiv would be to boost your public image due to “corporate social responsibility”.
The buyer would also get free marketing support from the German ad agency thjnk and free data escrow from NCC Group until July 2017, along with a bunch of software dotHIV uses to manage the TLD.
According to dotHIV, there were 14,000 pre-registrations with registrars prior to launch. Most balked at the high registration fee and did not convert into buyers.
The registry says the new owner could capitalize on some of this interest, growing volumes, by reducing its registry fee.
There are 47 registrars accredited to sell .hiv domains, including Go Daddy.
Premium names sold so far, for between $1,500 and $5,000, include: treat.hiv, test.hiv, cure.hiv, prevent.hiv, magazin.hiv, hivanswers.hiv, prävention.hiv, prep.hiv, vorsorge.hiv.
If dotHIV makes a profit from selling the gTLD, it says it will donate it to HIV charities.

.hiv to auction with “no profiting” catch

Don’t all rush to your checkbooks at once.
The live TLD .hiv is going to be among the next batch of new gTLDs auctioned off by Innovative Auctions, but the contract comes with a no-profit clause.
Innovative and dotHIV Registry announced the sale yesterday.
.hiv is an unsuccessful gTLD so far. It had just over 2,000 registered names at the end of 2014, according to registry reports, but never more than 423 the names have been present in the DNS.
Registry CEO Carolin Silbernagl said:

In the eight months since our launch we have gained a lot of insight about what it needs to reach this. The reason why we are offering .hiv for sale is because we see how successful it can be. However, we realized that dotHIV is not the right vehicle for the next phase – the TLD needs a bigger and more international home to truly spread its wings.

It went to general availability last August, with an innovative but risky business model based around charitable micro-donations to HIV/AIDS causes.
Of the $200 annual retail fee, dotHIV put $120 into a pool reserved for charities. Every visit to a .hiv that was participating in a “Click Counter” service would cause a small amount of that money to actually be donated.
Judging by visits to a few .hiv domains this morning, just €862 — less than $1,000 — has been donated so far, based on fewer than 133,000 clicks.
This donation model is “just one of many possible uses” and not a contractual requirement, according to Silbernagl.
There is, however, a binding Public Interest Commitment that obliges the registry to give “all excess profits” to HIV causes. The PIC reads:

Registry Operator commits to implementing and performing the following protections for the TLD: Registry Operator, as a social enterprise, is driven by its sole mission to support the global HIV response. Therefore, Registry Operator will reinvest all excess profits in projects serving this mission.

Not it’s not exactly an attractive investment opportunity, in terms of pure cash ROI.
But Innovative said there’s another reason to buy: “Approaching .hiv as a corporate philanthropic engagement could have positive effects on public image and employee satisfaction for the buyer.”
.hiv is due to be part of the June 3/4 live gTLD auction, which also includes .promo.

.hiv’s innovative, dangerous business model

.hiv, the first charity gTLD, is set to go to general availability at 2pm UTC tomorrow with one of the strangest and riskiest business models of any new gTLD to date.
While registrants will be able to use .hiv domains more or less as they please, as with any other gTLD, Berlin-based registry dotHIV is banking on an innovative microdonation system to set the space apart.
When you buy a .hiv domain, you’ll be sent an invitation by the registrar or registry to join an optional Click-Counter service, according to dotHIV chief marketing officer Michael Twist.
If you join the service, every time somebody visits your .hiv web site, dotHIV will donate a tenth of a US cent to one of four (initially) HIV/AIDS-related charity projects.
The donation will come from a pool of cash set aside by the registry from its registration fees.
While .hiv names are going to be sold, by 80 to 100 registrars at launch, for close to $200 per year, $120 of each registration or renewal fee will go into this charitable pool.
This business model is unprecedented in the domain name space, and it’s leading to the registry behaving in ways you wouldn’t expect from a new gTLD business.
For starters, dotHIV isn’t overly concerned about promoting its end users in a big way right out of the gates. It needs to refill its diminished cash pool to be able to cover the microdonations.
At first, it’s more concerned about volume and premium domain sales.
This problem is more pressing because of the longer-than-expected process of getting the .hiv application through the ICANN evaluation and delegation process.
“The microdonation system only works if we’ve got money in the pot,” said Twist. “The delay in the ICANN process has eaten up some of the funds.”
With a $120 donation from each sale, any given .hiv domain would only need to generate 1.2 million clicks in any given year to render it ‘unprofitable’ — ie, taking more from the pot than it put in.
dotHIV therefore needs time to ensure the pot of money from registrations is big enough to cover any big traffic spikes — what if a .hiv link goes viral, or a big-brand company starts using one? — before promoting the end-user sites in any meaningful way.
“First we need to push for registrations, and then traffic,” said Twist. “We can’t get too many people clicking before we hit a critical mass to support what we’re trying to do.”
There’s also the other possibility: that dotHIV, which is a registered charity, may wind up sitting on a pile of cash from registrations that is not going to its designated causes due to a lack of clicks on its users’ sites.
There’s risk in both directions, which begs the question: why not just donate the $120 to charity at the point of registration?
“More than just trying to raise funds what we’re doing is trying to raise awareness,” said Twist.
By encouraging (eventually) viral, click-based fund-raising, the registry hopes to put a spotlight back on the virus, which perhaps isn’t as trendy a cause as it once was due to the development of drugs that can delay the onset of AIDS by decades.
dotHIV is launching with some premium sales and some big-name anchor tenants under its belt.
Twist said that a “handful” of $10,000 names, which he declined to identify, have already been sold to pharmaceuticals companies involved in the development of HIV drugs.
There are about 10,000 reserved premiums in the space, he said, with a starting price of $5,000. Premium buyers will have to commit to usage rules including a commitment to use the Click-Tracker.
Keep a Child Alive, the charity founded by musician Alicia Keys, is among those committed to be early adopters and the Federation of Gay Games will use sport.hiv.
From the domain world, corporate registrars Mark Monitor and IP Mirror are to use .hiv domains.
There are no rules preventing domainers registering in .hiv (perhaps even treating it as a donation rather than an investment) but Twist said the registry would be disappointed to see large numbers of parked sites.

Key-Systems to take a loss on .hiv domains

Key-Systems said yesterday that it plans to make .hiv domain names available at “below net cost price”, in solidarity with would-be new gTLD registry dotHIV.
The registrar said it will also offer free .hiv names at launch to organizations involving in fighting the virus via its Moniker and domaindiscount24.com retail registrars.
dotHIV, also a German company, plans to donate all of its profits to HIV/AIDs charities.
Its application is uncontested and has already passed Initial Evaluation, but is the target of Governmental Advisory Committee advice, which has put its bid on hold.
Despite this uncertainty, Key-Systems said it expects the Sunrise phase for .hiv to start in December.