Redacted Whois at GoDaddy: a revenue hit but better customer experience

Privacy laws and bad customer experience are forcing GoDaddy to rethink a cash cow.

Last Friday, Elliot Silver broke the news that GoDaddy is planning to limit personal information in Whois records starting later this year.

GoDaddy is the largest domain name registrar in the world, and also one of the few large registrars that still shows personal information in Whois. Most stopped showing this information, such as email addresses and phone numbers, after GDPR went into effect. GoDaddy decided to only redact personal information for people in the European Union, for which GDPR applies.

I wasn’t surprised that GoDaddy held out for so long. GoDaddy’s Domains By Proxy product is a cash cow. Security company DomainTools ran a quick search for Domain Name Wire using “Domains By Proxy, LLC” and discovered 18 million Whois records. The actual number could be lower or higher given this crude search, but it gives an order of magnitude. (GoDaddy declined to comment on the number for this story.)

At $10 per year, that’s $180 million in annual revenue at nearly 100% margin.

That’s a lot of revenue and profit to give up. But changing privacy laws and customer experience have forced GoDaddy to take action.

Privacy laws are springing up all around the world, including the California Consumer Privacy Act.

And by keeping Whois information public, GoDaddy provided a lousy customer experience. Customers are inundated with telemarketing calls and spam after registering domain names. Many of the callers pretend to be GoDaddy offering additional services.

I recently registered a handful of domains for a friend and added Whois privacy on each registration to avoid the hassle. It stung a bit because the privacy service cost more than the domains.

After one recent experience dealing with a deluge of robocalls after registering a domain, I decided that it might be worth it—even in my unique position—for GoDaddy to begin blocking Whois information.

In my unique position, the downside of private information is that it’s harder to research the owners of domains for stories. This includes investigative stories, end user reports, and more. As a domain investor, I can’t verify ownership of domain names. There are downsides to no Whois and I’ve felt the sting of it over the past couple of years.

It will be interesting to see if GoDaddy retains some sort of “Domains by Proxy lite” service that blocks whatever information Whois records still display, or offers some sort of additional value to users. Such a product might also justify not refunding customers for previous Domains by Proxy purchases.

Either way, GoDaddy is going to have to manage the financial hit that this is sure to cause.