Namecheap made a wholesale switch to its own accreditation in January.
ICANN has published data from Verisign about .com activity in January, and it reveals a good reason why Rightside sold eNom to Tucows.
Namecheap has always been a big part of eNom’s business. It has historically accounted for about a quarter of eNom’s domains under management.
Namecheap has registered its domain names through the eNom reseller platform. We didn’t have exact figures on its monthly volume, even though we knew it was big.
When new TLDs came out, Namecheap started registering many of these domain names under its own registration accreditation. Then, in January this year, it started registering .com domains through its own accreditation…and landed within the top five registrars for new registrations that month with over 100,000.
This means that Rightside (NASDAQ:NAME) was about to show a big drop in revenue in Q1 of this year. Apparently, it immediately moved to sell eNom.
It found a willing buyer in Tucows (NASDAQ:TCX). On stage at NamesCon, Tucows CEO Elliot Noss said he was aware that Namecheap was moving off the platform. But that doesn’t hurt the deal from Tucows’ perspective.
Namecheap negotiated very low rates because it was so big. If you measure your business on revenue growth (as Rightside does) then losing Namecheap is a big loss. In Tucows’ case, however, it hopes to add about $20 million EBITDA/year from the business. Losing Namecheap shouldn’t negatively impact that because it was so low margin.
Here’s a look at how the registrars fared with new registrations and transfers in January: Click here to see the charts…