Third ICM windfall due as .sex hits sunrise

If we’ve learned one thing about new gTLD sunrise periods, it’s that adult-oriented TLDs sell quite well.
ICM Registry started its third such period yesterday, as .sex went into its “TMCH Sunrise” phase.
Until October 1, any company with a trademark in the Trademark Clearinghouse will be able to buy a matching .sex domain on a first-come, first-served basis.
From October 5 to October 30, anyone with a .xxx domain name or current .xxx “Sunrise B” block will be able to buy the matching .sex during the Domain Matching phase.
Anyone who buys a .xxx before October 1 will be able to participate in this second sunrise.
ICM reported in May that .porn received 3,995 sunrise registrations while .adult sold 3,902 — both via a combination of TMCH Sunrise sales and blocks.
At ICM’s prices, that’s enough to comfortably cover its ICANN application fees.
Every other new gTLD with the exception of .sucks has sold fewer than 1,000 sunrise names.
General availability for .sex starts November 4.

.food could be heading for limbo after closed generic applicant wins auction

The future of the .food gTLD is up in the air after single-registrant applicant Lifestyle Domain Holdings won its contention set.
The applicant, a subsidiary of Scripps Networks, is the sole remaining .food applicant after withdrawals from Donuts and Dot Food LLC.
It’s also a recalcitrant “closed generic” applicant, which continues to insist it has the right to exclude all third-party registrants from the .food namespace.
The company seems to have won .food at auction, even though ICANN recently slapped a ban on closed generics in the current application round.
Scripps will not be able to launch .food any time soon, unless it changes its planned registration policies.
The company may have essentially just paid to have .food placed on hold until the next new gTLD round.
Scripps runs a cable TV station in the US called Food Network, which it says is famous. It also runs Food.com, which it describes as “the third largest food site on the web”.
The current version of its application states:

Applicant intends to function in such a way that all domain name registrations in the TLD shall be registered to and maintained by Applicant and Applicant will not sell, distribute or transfer control of domain name registrations to any party that is not an Affiliate of Applicant

When ICANN asked applicants if they would like to revise their closed generic applications to allow third-party registrants, due to adverse Governmental Advisory Committee advice, Scripps was one of half a dozen applicants to decline.
Audaciously, the company told ICANN that an open registration policy for .food would hurt its brand:

To open the top level domain means that anyone could register a domain for a small annual amount of money and exploit, confuse and infringe upon the brand equity and goodwill of the famous FOOD, FOOD NETWORK and FOOD.COM brands established by Scripps with more than twenty years and hundreds of millions of dollars in investment.

Yes, Scripps thinks that when people think of “food”, they automatically think of the “third largest food web site” or a cable TV network that gets a 0.21% audience share in the UK.
A nonsense position, in other words.
So will Scripps get to run .food as a closed dot-brand? Probably not.
In June, ICANN ruled that the remaining closed generics applications (.food, .hotels, .grocery, .dvr, .data, and .phone) had the choice of either withdrawing, dropping their exclusivity plans, or carrying their applications over to the next gTLD application round.
Having just paid its competing applicants to go away, one assumes that Scripps’ withdrawal is off the cards.

Laughable security report labels Google Registry “shady”

A report by security company Blue Coat Systems today denounced new gTLDs as “shady” and recommended organizations think about blocking the “shadiest” ones entirely.
The study classified “tens of millions” of domains requested by users of its censorware service according to whether they had content that posed a security risk.
It found that nine new gTLDs and one ccTLD scored over 95% — that is, 95% of the domains in those TLDs requested by its customers were potentially unsafe.
But its numbers, I believe, are bollocks.
My main reason for this belief? Blue Coat has ranked .zip as “100% shady”.
This means that, according to the company, every single .zip domain its customers have visited is either spam, malware, a scam, a botnet, suspicious, phishing or potentially unwanted software.
The problem is that the entire .zip zone file currently consists of precisely one (1) domain.
That domain is nic.zip, and it belongs to Google Registry. This is a pre-launch TLD.
As far as I can tell, Google Registry is not involved in distributing malware, spam, phishing, etc.
Nevertheless, Blue Coat said network administrators should “consider blocking traffic” to .zip and other “shady” TLDs.
The top 10 list of the worst TLDs includes .country, .kim, .cricket, .science, .work, .party, .gq (Equatorial Guinea) and .link.
That’s a mixture of Afilias, Minds + Machines, Famous Four and Uniregistry. The common factor is the low cost of registration.
The full Blue Coat report, which can be downloaded here, does not give any of the real underlying numbers for its assertions.
For example, it ranks .review, one of Famous Four Media’s portfolio, as “100% shady” but does not reveal how many domains that relates to.
If its customers have only visited 10 .review domains, and all of those were dodgy, that would equate to a 100% score, even though .review has over 45,000 domains in its zone.
At the other end of the table, .london’s score of 1.85% could have been positively affected by Blue Coat customers visiting a broader selection of .london domains.
The company claims that the report is based on “tens of millions” of domains, but I’d hazard a guess that most of those are in .com and other more established TLDs.
That’s not to say that there’s no truth in Blue Coat’s broader assertion that a lot of new gTLDs are full of garbage — do a Google search for .review sites and see if you can find anything worth looking at — but I don’t think its numbers are worth the pixels they’re written with.

ICANN finally publishes THAT .africa letter, makes me look like an idiot

ICANN has finally published the letter it controversially drafted for the African Union Commission in order to help it express support for ZA Central Registry’s .africa bid.
Having now read the draft letter for the first time, on balance I’d have to say my previous opinions on its contents were more wrong than right.
The letter was central to claims by rival .africa applicant DotConnectAfrica that ICANN treated ZACR preferentially during the evaluation of both applications.
It was drafted by ICANN staffer Trang Nguyen around June 25, 2013, and sent to ZACR.
It was then edited by ZACR and the AUC, signed by the AUC, and returned to ICANN, whereupon it was forwarded to the new gTLD’s program’s Geographic Names Panel at InterConnect Communications.
The GNP took the letter as an official endorsement of ZACR’s bid, enabling it to pass the Geographic Names Review and proceed to the next stage of the program.
Having seen (and published) the signed AUC letter, I opined here in July that it looked like it had been mostly been written by ZACR and/or the AUC.
I no longer believe that.
It’s now proven that the AUC redraft goes far beyond the “minor edits” that have been claimed by DCA and others — for starters, it’s 40% longer — but a lot of the text that I believed to be ZACR’s work turns out in fact to have come from ICANN.
I’ve put the two letters into a single document (pdf), so you can do a side-by-side comparison if you wish.
There’s still no question that ZACR had African government support for its bid and DCA did not. The dispute centers entirely on whether InterConnect had received expressions of support in the correct format.
An Independent Review Process panel declined to issue an opinion on whether ICANN did anything wrong by drafting the letter, though it is mentioned in its final declaration.
ICANN itself says that it did nothing wrong by drafting the letter, and had DCA had any governmental support it would have done exactly the same thing for it.
The draft letter was among hundreds of pages of documents published last night by ICANN following a Documentary Information Disclosure Process request filed by DI a little over a month ago.

Radix targets a million .online names in 2-3 years

Having just finished the most-successful new gTLD launch day to date, Radix Registry reckons it can get .online to seven figures in two to three years.
“We’re at 37,170 names as of an hour ago,” Radix CEO Bhavin Turakhia told DI at about 1000 UTC this morning.
That represents less than a full day of general availability. The company said last night that 28,000 names were registered in the first 30 minutes.
UPDATE: At the 24-hour mark, Radix tweeted this:

What an exciting Day 1 it has been for .online! Total DUMs 24 hours into the GA is 39,449 #newgTLDs #domaining

— Radix (@RadixRegistry) August 27, 2015

That beats .club’s 25,000-ish, which was Radix’s publicly stated goal, but it also tops .berlin’s 31,000 first-day names.
The CEOs of both these rival registries had publicly predicted their positions would be toppled and actively encouraged Radix to claim the crown.
Turakhia said that the majority of names registered came from pre-orders, largely at 1&1.
“Fourteen thousand names came from 1&1, 6,000 from Go Daddy, 2,700 from United Domains, 1,900 from Name.com and 1,400 from Tucows,” he said, partially breaking down the 37,170 figure by registrar.
He said the goal is to have a .online zone measured in the millions of names.
“I estimate that we should be able to get to a million names in a period of two to three years,” he said. “That’s on a conservative basis.”
Depending on how you count domains, .xyz may have already been the first to hit one million. Its zone never got as high as a million names, but it may have briefly crossed a million in terms of domains under management earlier this year.
At auction, .online sold for what is believed to be an eight-figure sum, originally to a joint venture of Radix, Tucows and Namecheap.
Radix bought out its partners earlier this year.
That was an increase in risk exposure Radix business head Sandeep Ramchandani said made him nervous. He said launch day’s numbers show .online’s potential.
Turahkhia said that there are 680,000 names in the .com zone that end in “online” today, and a million that have “online” somewhere in the second level, showing that the string is desirable to registrants.
Radix said last night that its Early Access Period — during which names are sold for a higher price — ended with 1,130 sales.
Turahkhia said that of these, about 1,000 were registered in the last three days, during which time the price was $100. Regular .online pricing is around the same as .com ($14.99 at 1&1 and Go Daddy), but some registrars are selling for as much at $50.

Free speech banned from .bible

The Bible may be a piece of literature that belongs to the world, but in .bible it’s going to be a propaganda tool for Christians.
The just-published Acceptable Use Policy (pdf) bans any content that the American Bible Society, acting as registry, deems unsuitable. Specifically prohibited:

Pointing to any content that may, as determined in ABS’s sole discretion, disparage or blaspheme God, Jesus, the Holy Spirit, Christianity (to include any sects or denominations), the Bible, or any other such tenet, symbol, representative or principles of the Christian faith.
Pointing to any content that, as determined in ABS’s sole discretion, espouses or promotes a religious, secular or other worldview that is antithetical to New Testament principles, including but not limited to the promotion of a non-Christian religion or set of religious beliefs.

This would seem to ban, for example, a web site that used the Bible’s text to question whether human sacrifice and scapegoating are really moral precepts by which people should live their lives.
ABS is a non-denominational organization, so presumably you are allowed to set up sites that say Eucharistic wine is really magic human blood, and also that it isn’t.
The registry is the publisher of the “Good News” modern-English translation of the Bible, which ends with billions of people being cast into a lake of fire to burn for eternity.

M+M gets $3.5m from two gTLD auctions

Minds + Machines secured loser fees totaling $3.5 million from its participation in .art and .data new gTLD auctions, the company disclosed today.
It seems .data was auctioned recently. It was a three-applicant string and none of the applicants have yet withdrawn their applications.
It seems either Donuts or brand applicant Dish DBS won the string.
The .art auction happened well over a month ago, with the final losing applicant withdrawing on July 23.
UK Creative Ideas won .art. Whatever it paid for the string would have been shared between nine competing applicants.
M+M also said that “strong interest” (presumably no sales yet) has been expressed in its $15,000+ “super premium” registry-reserved names, and that it has sold 20 premium names in its .london auction last month.

ICANN will post more uncensored .africa info

ICANN has committed to post more unredacted documents from its Independent Review Process case with DotConnectAfrica, following a request from DI.
The organization told DI today that it will publish the documents on its web site by August 31, in response to our July 27 Documentary Information Disclosure Request.
I’d asked ICANN to publish, unredacted, the entire declaration of the IRP panel, along with all equally unredacted exhibits and hearing transcripts.
Aware that ICANN enjoys invoking its “Defined Conditions for Non-Disclosure” in order to stop material being released sometimes, I added “that the public interest and transparency benefits to ICANN of disclosing this information far outweigh any benefit that could be accrued by invoking the Defined Conditions for Non-Disclosure”.
In response, ICANN said today (pdf) that it evaluates the public interest when processing DIDP requests, adding:

we have determined that to the extent additional information warrants disclosure and can be released without further consultation with third parties ICANN will publish that unredacted information no later than 31 August 2015. We will send you an email notification upon that publication. To the extent that disclosure of some information designated as confidential by third parties may be warranted and requires further consultation with third parties, or consultation with other third parties not previously consulted, ICANN has already initiated that consultation process. ICANN will publish such further unredacted information promptly upon, and to the extent that we receive, authorization from the relevant parties to release the information, and will send you an email notification upon that publication.

Since the DIDP was filed, ICANN has published over 700 pages of redacted transcripts from two in-person IRP hearings that took place in May.
Today, it also published a letter from DCA’s competing .africa applicant, ZA Central Registry, comprising an ultimately unsuccessful request for a couple of seats at the hearing.
What has not yet been published are the IRP exhibits showing exactly what ICANN did to oil the gears for ZACR’s application.
Due to Kieren McCarthy’s articles at The Register and ICANN’s subsequent admissions, we know that ICANN staff drafted a letter that the African Union Commission could use to express its support for ZACR in the correct format.
However, the IRP exhibits that would give clarity into what exactly ICANN sent and why remain redacted.
Communications between ICANN and InterConnect, which ran the Geographic Names Panel, and references to the Kenyan government’s did-they-didn’t-they support for DCA also remain redacted.

Did XYZ.com pay NetSol $3m to bloat .xyz?

Evidence of a possibly dodgy deal between XYZ.com and Network Solutions has emerged.
Court documents filed last week by Verisign suggest that the .xyz registry may have purchased $3 million in advertising in exchange for $3 million of .xyz domain names.
Verisign, which is suing .xyz and CEO Daniel Negari over its allegedly “false” advertising, submitted to the court a list of hundreds of exhibits (pdf) that it proposes to use at trial.
Among them are these two:

• Email from Negari to Andrew Gorrin re EPP Feed and billing directly for $3,000,000 in domains
• Credit Memo to Andrew from Negari “We have elected to pay for our $3MM Q2 advertising insertion order, which was dated May 20th with a credit…….” (5/31/14)

Gorrin is Web.com’s senior VP of marketing and Negari is Daniel Negari, XYZ.com’s CEO.
The documents these headings refer to are not public information, and are not likely to be any time soon, but they appear to refer to on the one hand XYZ billing NetSol for $3 million in domain names and on the other NetSol billing XYZ for $3 million in advertising.
Only one of the two document headings is dated, so we don’t know how closely they coincided.
Other headings, among the 446 documents Verisign wants to use at trial, suggest that they happened at pretty much the same time:

• Email from Andrew Gorrin to Ashley Henning (web.com) re Bulk Purchase of .xyz domains (5/29/14)
• Email from Andrew Gorrin to Negari re XYZ.Com Advertising IO and Marketing Agreement attaching signed agreements (5/20/14)
• Email string Ashley Henning to Christine Nagey, Andrew Gorrin, Edward Angstadt re Bulk Purchase of .XYZ Domains (5/30/14)

The emails Verisign cites were dated May 2014, shortly before .xyz went into general availability June 2.
What we seem to be looking at here — and I’m getting into speculative territory here — are references to two more or less simultaneous transactions, both valued at exactly $3 million, between the two parties.
Both companies have consistently refused to address the nature of their deal, citing NDAs.
As you recall, the vast majority of .xyz’s early registrations were provided by NetSol, which pushed hundreds of thousands of free .xyz domains into its customers’ accounts without their explicit consent.
The number of freebies is believed to be about 350,000, based on comments Negari recently made to The Telegraph, in which he stated that .xyz, which had about 850,000 domains in its zone at the time, would have 500,000 registrations if the freebies were excluded.
With a registry fee roughly equivalent to .com’s (.xyz’s is believed to be a little lower), 350,000 names would work out to roughly $3 million.
Negari has stated previously that every .xyz registration was revenue-generating, even the freebies.
Is it possible that NetSol paid XYZ’s registry fees using money XYZ paid it for advertising? Is it possible no money changed hands at all?
I’m not saying either company has done anything illegal, and it’s completely possible I’m completely misunderstanding the situation, but it does rather put me in mind of the old “round-trip” deals that tech firms used to dishonestly prop up their tumbling revenue at the turn of the century.
Back in 2000, the dot-com bubble was on the verge of popping, taking the US economy with it, and companies facing the decline of their businesses came up with “creative” ways to show investors that they were still growing.
AOL Time Warner, for example, “effectively funded its own online advertising revenue by giving the counterparties the means to pay for advertising that they would not otherwise have purchased”.
Regulators exercised their legal options in these cases only where there appeared to be dishonest accounting, and I’ve seen no evidence to suggest that XYZ or Web.com unit NetSol have failed to adhere to anything but the highest accounting standards.
Again, I’m not saying we’re looking at a “round-trip” deal here, and there’s not a great deal of evidence to go on, but it sure smells familiar.
Certainly, questions have been raised that Verisign did not raise in its initial complaint.
Anyway.
On a personal note, I’d like to disclose that among the documents Verisign demanded from XYZ are dozens of pages of previously confidential emails exchanged between myself and Negari.
I’ve read them, and they’re mostly heated arguments about a) his refusal to give details about the NetSol deal and b) my purported lack of journalistic integrity whenever I published a post about .xyz with an even slightly negative angle.
XYZ had no choice but to supply these emails. I can’t blame it for complying with its legal requirements.
I wasn’t the only affected blogger. Mike Berkens, Konstantinos Zournas, Rick Schwartz and Morgan Linton also had their private correspondence compromised by Verisign.
I don’t know how they feel about this violation, but in my view this shows Verisign’s contempt for the media and its disregard for the sanctity of off-the-record conversations between reporters and their sources.
And that’s what I have to say about that.

Afilias wins $10m judgment in Architelos “trade secrets” case

Afilias has won a $10 million verdict against domain security startup Architelos, over claims its flagship NameSentry abuse monitoring service was created using stolen trade secrets.
A jury in Virginia today handed Afilias $5 million for “misappropriation of trade secrets”, $2.5 million for “conversion” and another $2.5 million for “civil conspiracy”.
The jury found (pdf) in favor of Architelos on claims of business conspiracy and tortious interference with contractual relations, however.
Ten million dollars is a hell of a lot of cash for Architelos, which reportedly said in court that it has only made $300,000 from NameSentry.
If that’s true, I seriously doubt the four-year-old, three-person company has even made $10 million in revenue to date, never mind having enough cash in the bank to cover the judgment.
“We’re disappointed in the jury’s verdict and we plan to address it in some post-trial motions,” CEO Alexa Raad told DI.
The lawsuit was filed in January, but it has not been widely reported on and I only found out about its existence today.
The original complaint (pdf) alleged that three Architelos employees/contractors, including CTO Michael Young, were previously employees or contractors of Afilias and worked on the company’s own abuse tools.
It claimed that these employees took trade secrets with them when they joined Architelos, and used them to build NameSentry, which enables TLD registries to monitor and remediate abuse in their zones.
Architelos denied the claims, saying in its March answer (pdf) that Afilias was simply trying to disrupt its business by casting doubt over the ownership of its IP.
That doubt has certainly been cast, though the jury verdict says nothing about transferring Architelos’ patents to Afilias.
The $5 million portion of the verdict deals with Afilias’ claim that Architelos misappropriated trade secrets — ie that Young and others took work they did for Afilias and used it to build a product that could compete with something Afilias had been building.
The other two counts that went against Architelos basically cover the same actions by Architelos employees.
The company may be able to get the amount of the judgment lowered in post-trial, or even get the jury verdict overturned, so it’s not necessarily curtains yet. But Architelos certainly has a mountain to climb.