A Pragmatic View on the .org Sale

Ethos Capital purchases .org

I’ve been reading with interest about the sale of the .org registry by the Public Interest Registry (PIR) to Ethos Capital. The value of the deal is just shy over $1.1 billion and if you are to believe some people, the deal was done in a cesspool of corruption and scandal.

Escrow.com

What's in it for PIR? They are now funded to do good for the Internet in the long,long,long-term future without having to worry about running a registry. Could you imagine being on the board of PIR, facing the prospect of another round of extensions being released by ICANN and then having a billion-dollar opportunity fall out of the sky and into your lap? You would be crazy not to seriously look at it!

Now let’s think about the numbers for a second. A typical .org domain sells for $10 (to make the maths easy) and since they have roughly 10 million domains in the registry then .org generates a top line revenue of $100 million per year. Of course, this is shared with the registrar in a variety of different agreement structures but let’s imagine that it wasn’t.

By paying $1.1 billion for the business either Ethos Capital is possibly going to be looking for a long-term hold (ie. north of 11 years) of the business, plan on growing the number of domains or there is some other reason they purchased it.

Growing the registry is a long, hard road. The entire domain space grows by about 5% per year and .org is a small percentage of that. If they managed to grow by 200,000 domains (ie. 2% per year) it would be a miracle. This would only add $2 million to the top line revenue and doesn’t really change the ROI economics that much for Ethos Capital.

Continue reading
0
  4467 Hits
  13 Comments
Recent Comments
bmugford
"The one tangible fear that domain investors have is that .org will suddenly increase their prices. If your business depends entir... Read More
07 December 2019
mgilmour
I tried to write this article with a very pragmatic perspective. I didn't say whether I liked the outcome or not....only that I wa... Read More
08 December 2019
Guest — page howe
pragmatic??? i think you lose the concept Vinf Cerf gave .org to the Internet Society, then said we should cash out. Now we've w... Read More
07 December 2019
4467 Hits
13 Comments