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Breaking: Verisign won’t raise .com prices this year

by — Services 7 Comments

Even if ICANN gives the company the nod, it won’t raise prices this year.

Verisign logoVerisign (NASDAQ: VRSN), the registry for .com and .net domain names, won’t raise prices for its domain names this year.

In an announcement on its blog, the company announced the price freeze in response to the COVID-19 pandemic.

As of right now, Verisign can’t raise prices on .com anyway. However, ICANN is widely expected to allow Verisign to increase .com prices 7% this year. It’s not known if ICANN planned to delay its decision due to the pandemic.

Freezing .com prices for the year won’t have much of an impact on Verisign’s bottom line for the current year. Even if ICANN decided next month to allow the company to raise prices, it would have to wait 6 months before implementing the change. At the earliest, it would be able to raise prices in October.

What remains to be seen is if Verisign will ask for the right to increase prices twice (or double) next year due to this year’s freeze. That might require approval by the U.S. National Telecommunications and Information Administration (NTIA). [Update: Kevin Murphy points out that the “year” for Verisign’s first price increase doesn’t begin until October 20, anyway. So Verisign can initiate its first price increase for anytime between then and October 20, 2021.]

The company is also rolling out a program to registrars that may help registrants keep their domains if they aren’t able to pay for them due to the pandemic.

Verisign gets IDN homograph detection patent

by — Services 0 Comments

System would help detect homograph attacks shortly after domains are registered.

Image from Verisign patent for homograph detection

Examples of domains that could be used in homograph attacks. Image from Verisign patent.

The U.S. Patent and Trademark Office has granted patent number 10,599,836 (pdf) to Verisign (NASDAQ: VRSN) for “Identification of visual international domain name collisions.”

The patent describes a way to detect a “homograph attack”. A homograph attack is when someone creates a mixed-script domain name that is visually similar to another domain name. Many top level domain names allow registrants to register domain names that include more than one script in an internationalized domain name. For example:

…a malicious entity could register the IDN “xn- -oogle-wmc .com” via a registration service. When a web browser displays this IDN, the punycode element “-wmc” would direct the web browser to place a Latin small capital letter “G” in front of the characters “oogle”—resulting in the domain name Googl e.com. Users accessing Google .com would then be directed to the IDN registered by the malicious user rather than to the expected home page of google.com.

To detect homograph attacks, the patent suggests turning the domain name into an image and then using optical character recognition to look for similarities.

The patent is similar to one that Morgan Stanley recently applied for.

Homographs are a big issue with IDNs. Donuts, which operates over 200 top level domains, includes homograph protection in its Domains Protected Marks List product and plans to expand its homograph protections in the future.

MMX swings to profit in 2019, 25% revenue growth

by — Services 1 Comment

MMX (Minds + Machines) had a good year in 2019, and 2020 looks solid barring COVID-19 impact.

Picture of stock ticker board with words "earnings announcement" below it

Accounting wise, 2018 was a bad year for new top level domain name company MMX (London AIM: MMX). It wrote off $11.3 million related to a contract to run .London, had bad debt write-offs of $2.1 million, and one-off costs of $1.4 million. It lost $12.6 million for the year.

The good news is that this pushed a lot of water under the bridge, making 2019 a stellar year for the company, as detailed in the company’s annual report.

In 2019, MMX reported a profit of $4.7 million, or 0.51 cents per share.

Sure, that was helped by a couple of accounting gains, but anyway you look at it, 2019 was a much better year for the company.

Revenue increased 25% to $18.9 million, helped in part by a full year of the contribution of ICM Registry, a business it acquired in 2018.

Renewal revenue was $11.7 million, or 62% of the total.

Operating EBITDA was up 79% to $6.4 million.

And Adultblock, a new brand protection product related to the ICM Registry portfolio, generated $1.1 million in recognized revenue during the last two months of 2019.

While ICM had a lot to do with MMX’s changed fortunes, the company also saw positive movement in some of its other top level domains. In Q4, .VIP grew by over 360,000 registrations. Importantly, 267,000 of these were standard sales at GoDaddy. (Read: not heavily discounted sales to China.)

In its annual report, the company notes that it is closely watching the impact of COVID-19. For now, it expects the immediate-term impact to be on one-off brokered sales but those account for less than 10% of the company’s sales.

As it monitors the impact, the company has delayed its decision on a previously-announced dividend until September. In the meantime, it’s going forward with share buybacks of its (now cheaper) shares.

MMX’s report is perhaps the first financial report by a publicly-traded domain name company in the wake of the spread of COVID-19. While the company is hopeful, it provides caution that everyone in the domain business should heed:

“But to believe that we are fully insulated from the global crisis would be unwise.”

Is Verisign “immune from coronavirus”?

by — Services 3 Comments

Immune might be too strong of a word, but it’s a safer bet than many other businesses.

Verisign logoThis weekend I calculated how much domain name stocks have fallen in the stock market rout. Verisign (NASDAQ: VRSN) fell less than other domain stocks, and I wrote, “It makes sense that the stock wouldn’t be as hard hit as the overall market. It delivers consistent, subscription-based revenue that is likely to go up as it’s allowed to raise prices.”

An author on SeekingAlpha went a step further today, publishing a post arguing that “Verisign Is Immune from Coronavirus.”

Ash Anderson, who was not long on Verisign stock at the time of publishing, gives a long list of reasons that he thinks Verisign won’t be impacted. He also provides an excellent summary of Verisign’s business:

To convey what VeriSign does in the fewest words, imagine a toll road. If you’re on it, you’re paying. Well, VeriSign is that, but for the internet. For every .com domain name registered, the company collects $7.85 per year for every .net registered, a little bit north of $9. With no competition around, they are the internet’s toll road.

Recurring subscription businesses like Verisign, especially those that collect on an annual basis, should be OK if the coronavirus impacts are short-lived. They might have some exposure on new adds during a brief downturn, but they can move levers (such as heavy discounting) to make up for it.

I think the most significant risk would be if ICANN delays a decision on allowing it to increase prices. I don’t think this will happen, but should ICANN put this on the back burner during the crisis, or decide that now is not an appropriate time to move forward, it would delay the date at which Verisign can raise prices 7%. We’re just talking about a short delay, however.

I agree with the author that, in these turbulent times, Verisign is one of the better bets on the stock market.

Tutorial: How to Track Verisign’s Monthly Top Popular Keywords using DomainScope API

by — Services 0 Comments

Alvin Brown provides a tutorial on how to use Verisign DomainScope’s API to produce and store monthly popular keywords for .com and .net domain registrations.

Once upon a time, Verisign provided a monthly email and blog post reporting the top trending keywords contained in recent .com and .net domain registrations for a given month. That all ended circa Q4 2019.

Fortunately, Verisign provides an online interface that gives visitors insight into the top 10 popular keywords for recently registered domains for the last 7, 30, 60 and 90 days or a custom time period.

Verisign DomainScope Tools

While this tool is good for the casual observer, it’s not necessarily the same report layout.

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