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The Lowdown

April 2006 Archive

Here's the The Lowdown from DNJournal.com! Updated daily to fill you in on the latest buzz going around the domain name industry!

Compiled by Ron Jackson (Editor/Publisher)
& Ray Hackney (DN Journal Special Correspondent)


The European Commission (the executive committee of the European Union) has ordered .eu registrar Eurid to investigate reported irregularities in the extension's rollout April 7 and to revoke illegal registrations. The EC response came after they received a flood of complaints about shell companies, many located outside the EU, sweeping up almost every desirable .eu domain, leaving citizens of EU countries empty handed. Eurid continues to maintain that everything was done above board. Eurid spokseman Patrick Linden said, "All of the 1,500 registrars were separate companies and fulfilled the requirements. Of course it's very well possible that a lot of these companies have the same owner." ng ac


A favorable buzz continues to build around International Domain Names (IDNs). Though there are still a number of technical issues to be resolved, many speakers at last week's Domain Roundtable Conference in Seattle predicted widespread acceptance for IDNs. DNForum.com owner Adam Dicker (who also spoke in Seattle) said in a recent newsletter that he had purchased more than 5,000 IDN domains over the past six months.


By now, everyone knows about the huge registration numbers piled up by the European Union's .eu since the extension was opened to public registration April 7. Considering all of the controversy surrounding the rollout you won't be surprised to know that the first official dispute over a .eu domain has already gone to arbitration with the decision coming down in favor of the registrant of pst.eu. Case details are here


A very successful Domain Roundtable Conference ended Friday (April 21) in Bellevue, Washington. 312 registrants (nearly double the number that attended last year's inaugural conference in Seattle) were on hand for round two. On Thursday night, a silent domain auction was held that included the $110,000 sale of Jail.com. The winning bidder is well-known to us so we have no doubt the transaction will be finalized. Our  complete conference wrap-up is available here


Vint Cerf, a man who played a huge role in the creation of the Internet (and is now Chief Internet Evangelist at Google.com) gave a superb keynote speech at the Domain Roundtable Conference in Bellevue, Washington Thursday morning (April 20). Cerf also wandered into the audience to take questions after his talk and many went away feeling the session with him alone was worth the price of attending Roundtable. Marc Ostrofsky of iREIT.com delivered another excellent keynote in the afternoon focused on the current state of the domain business and the future outlook for the industry. There were also two well-received keynote speeches on the opening day of the conference Wednesday (April 19), delivered by ICANN President Paul Twomey and Sedo.com Chief Strategy Officer Matt Bentley


TV advertisers are continuing to shift ad spending to the Internet. According to tech magazine Red Herring (3rd item down), "As the TV audience continues to fragment and in many cases abandon network TV, advertisers are beginning to question whether network TV advertising is as effective as the ratings claim. As a result, more advertisers are cutting back on their TV ad budgets and spending more money on the web. A whopping 80% of advertisers polled by Forrester Research said recently they will spend more of their advertising budget on web advertising, and 68% percent will look more to search engine marketing."


The boom in the domain business has become a frequent topic at mainstream media outlets. A new article on the front page of the April 14 edition of USA Today  was devoted to the resurgence of interest in domain names. A few hours after the article came out San Francisco talk radio station KGO had DN Journal Editor/Publisher Ron Jackson on their morning show to talk about the explosion in domain sales. The dollar value of sales reported to DNJournal.com in the first quarter of 2006 jumped 215% over the same quarter in 2005.


GoDaddy.com is going to go public according to a report from Marketwatch.com. The article says 3 seperate sources confirmed that GoDaddy had retained Lehman Brothers to manage an IPO that could raise over $100 million and value the company at more than $250 million. GoDaddy is one of the 20 fastest growing tech companies according to accountancy firm Deloitte & Touche who said the registration company's revenue soared from less than $1 million in 2000 to over $75 million in 2004.


Don't expect the .eu registry, EurID, to take any action in response to the many complaints that the registration process for the new European Union extension was rigged. Hundreds of so-called "shell registrars" were set up (most of them outside the EU) apparently for the sole purpose of grabbing the best .eu domains when the land rush started April 7. Though critics want names taken by those non-EU entities cancelled, EurID spokesman Patrik Lindn said "We don't plan to do anything as long as there has not been a breach of the contract each signed with us. We verified that each registrar was an individual legal entity and each had to sign an agreement with us and prepay 10,000 euros." Lind did acknowledge that some may have played the system, saying "It's definitely possible, but then anyone is allowed to have subsidiaries. If they have ten, they have a better chance, but it's not our concern. Our job was to make registering fair, and we did that."

America's country code extension, .us, broke the 1 million mark in total registrations April 11, making it one of only seven ccTLDs in the world with more than 1 million domains registered. .eu  joined the club just four days earlier when it went over 1 million on the opening day of the extension's land rush. The others (with their total number of registrations as of March 31, 2006) are Germany's .de (9,720,156), Great Britain's .co.uk (4,783,448), the Netherlands' .nl (1,859,732), Italy's .it (1,112,230) and Belgium's .be (1,028,741). 


While the sheer number of .eu domains that have been registered since the extension's opening day April 7  is impressive (see item below), there is also a dark side to the phenomenon. Many are complaining that the registration process was rigged to favor deep-pocketed domain speculators, many of whom are not even residents of the European Union. Domain blogs and forums are filled with allegations that the average EU citizen was left empty-handed in the .eu land rush. GoDaddy.com Founder and CEO Bob Parsons is one of the most vocal critics. In a blog entry April 9, Parsons accused the .eu registry (EurID) of allowing Europe's extension to be hijacked.


The new .eu extension got off to an impressive start April 7 with 300,000 new domains registered in the first hour. By the end of the day that number had soared well past 1 million, making .eu  the first new extension to ring up over 1 million registrations in it's first day of public availability. The strong demand temporarily crashed the WhoIs servers for EurID (administrators of the .eu extension) but that wasn't surprising under the circumstances. You can keep track of the current number of .eu registrations by visiting the EurID statistics page which is updated every 15 minutes.


Domains are becoming an increasingly popular subject on radio programs delivered via live webcasts or downloadable podcasts. Many of you are already familiar with the DomainMasters show hosted by Moniker.com CEO Monte Cahn and aired live every Wednesday night at 7pm U.S. Eastern Time on WebmasterRadio.fm. GoDaddy CEO Bob Parsons hosts another popular live weekly show the same night at 10pm Eastern (recently renamed from Radio GoDaddy to Life Online With Bob Parsons). Now the NamePros.com domain forum has given the concept a new twist with Radio NamePros, a series of podcasts on various domain topics that are produced by forum members. Forum owner Ron James says the site's podcast library will grow quickly as new programs are being added every week.


Popular aftermarket domain sales venues Sedo.com and Afternic.com continue to spread their reach through partnerships with major registrars. In the latest pairing, Sedo hooked up with Name.com. When that registrar's customers search for a particular name that someone else already owns, they will be shown a link to Sedo if the domain is available for sale. These partnerships increase awareness of the domain aftermarket and the often high resale value of quality domains. That in turn encourages new registrations and higher renewal rates for the registrars and provides an additional sales channel for the aftermarket venues (and more sales for their customers). Afternic has many similar agreements in place, their latest being a deal with Dotster.com.


Here's another reason to hate spyware. Ben Edelman (a Ph.D candidate in economics at Harvard and Harvard Law School graduate who has done extensive research on Internet commerce issues) said on his site April 4 that he has documented multiple instances of spyware generating fraudulent clicks on Yahoo! ads to produce revenue for the spyware companies involved in the scheme. Click fraud is widely believed to be the single biggest threat to the PPC industry that so many domain owners rely on for revenue. If advertisers feel they are being ripped off by click fraud they may reduce spending on the web and that would obviously be bad news for everyone in this business. If Edelman's research is accurate (and he has an excellent track record), we are hopeful that the light he has shed on this practice will lead to quick and appropriate punishment for the thieves involved.

If you've been out of the loop lately, catch up in the Lowdown Archive!

We need your help to keep giving domainers The Lowdown, so please email [email protected] with any interesting information you might have. If possible, include the source of your information so we can check it out (for example a URL if you read it in a forum or on a site elsewhere). 

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