This is the second in the series on "The History of RPM" and refers to the forumula discussed in Part 1.
Please click on the below link to view Part 1 of a History of RPM:
Part 1 - A History of RPM
A number of years ago, one domain parking company (Domain Sponsor) controlled a HUGE volume of traffic and ruled the industry. Using their market power, they began to dictate terms to Google. Although I wasn’t privy to internal discussions, I could view Google’s response from an external perspective.
Since a contract was in place Mg was VERY HIGH and Google was bound to pay a bonus for what they previously thought would be impossible high traffic levels. This created a virtuous spiral for Domain Sponsor. As payments increased, they sucked in more traffic, climbed the tiers and they then increased payments further etc…..well, you get the idea.
What did Google do? They shattered the market by issuing a whole lot of new contracts (eg. Parking Crew, Internet Traffic, Voodoo etc) and wrote contracts that provided sunrise clauses to new players, so the traffic was sucked out of Domain Sponsor and the tail was no longer wagging the dog. They then rewrote the contracts with shorter terms and different values for Mg.
For those of you that are familiar with Domain Sponsor you will also know that it no longer exists. This could be blamed on a whole variety of reasons from bad management and VC driven outcomes through to Google but the fact remains that the once king of the domain industry was dethroned and ground into the dust.
