VeriSign CEO: “PPC is a Dead Thing”
Tuesday, August 3rd, 2010
PPC no longer a driver of domain name registrations, says VeriSign CEO.
When it comes to growth opportunities for the .com namespace, domain parking “is a dead thing”, VeriSign President and CEO Mark McLaughlin explained on an analyst conference call yesterday.
McLaughlin was responding to a question from JP Morgan Chase & Co analyst Sterling Auty, who asked:
…on the 7.9 million new names that came in during the quarter, you mentioned international, but are there any other kind of trends or sources to those new name additions that you see?
No, Sterling, we’re fairly consistent quarter-over-quarter here as far as the sources of the names. So PPC is a dead thing. And it’s hard to tell any longer, anymore what’s in there at all. So it’s really just to where we used to call traditional and then broken out between domestic and international…
After years of registrations solely for domain parking purposes, this is no longer a growth driver for .com. This was, of course, driven by two changes: 1) the drop in parking earnings and 2) the end of the domain tasting “loophole”.
On the upside to VeriSign, this may mean higher renewal rates and perhaps a less price-sensitive customer base in the future.
Deutsche Bank analyst Todd Raker asked:
If you think Pay Per Click has really gone away, do you think the traditional base is price sensitive at current levels?
to which McLaughlin responded:
I think that the traditional base is price sensitive at the current levels. I think that what traditional base is trying dig in a lot of value from the name, for whatever purposes you’re using it or they like to keep them so they’re buying them and they renew them.
Keep in mind that a change of 50 cents or so in a year isn’t a lot of money if you only have a handful of domains. It’s when you have thousands that it starts to add up.
Other growth opportunities for VeriSign include new top level domain names, including IDN versions of its existing domains such as .com, said McLaughlin:
The second thing is we have growth opportunities right around that infrastructure related to like the new gTLDs I just discussed, both the new gTLDs themselves plus the internationalized version of the TLDs we run today. And if you take into account everything I’ve been saying about international growing very nicely, we think that there’s some growth opportunities around the non-English versions of the TLDs we run.
(Transcript from SeekingAlpha)