Comments (0) Tucows has been on a tear lately, up about 55% since my last article “Are Domaining Stocks About to Break Out” a little over a month ago. After taking a bit of a breather the last couple weeks it got some renewed energy today on what I am assuming are run-off speculations that after the big Demand Media news this morning. After being up nearly 15% over part of the day, it has cooled off to a mere 10% gain on 4X the volume.
I was planning on writing a post for awhile on how a nice domaining pair trade would be “long Tucows / short Demand Media”, but when I looked at the charts, it didn’t look like such a good pair trade any more.
I know, value investors don’t “do charts” and eschew technical analysis, but even though I’m a value investor I still occasionally commit heresy and give credence to the Stan Weinstein school of the “4-phase stock cycle”, as described in his seminal work “Secrets for Profiting in Bull & Bear Markets” (and revisited in Mike Swanson’s “Strategic Stock Trading“).
Tucows, Demand Media and Web.com all reported this week and they all delivered good news to shareholders. When you look at the charts, they all appear to be on the cusp of a Stage 2 bull run:
As you read this, please keep in mind that I say it all with a track record nearly 14 years of being proactive and having a zero-tolerance policy toward criminal activity and network abuse on the easyDNS system. We have great relationships with Law Enforcement Agencies both here in Canada and abroad. We are always helpful and (usually) happy to answer questions, and help LEA understand the complexities and nuances of the internet. We’ve had the good fortune to meet some really intelligent and clued in cybercrime units. We participate in numerous communities in combating net.abuse and cybercrime.
I finally got around to reading the text of the Stop Online Piracy Act (SOPA) today. While the ostensible intentions are to combat online piracy and the sale of counterfeit goods, the bad news is that the legislation contains elements which basically puts every single domain registered under generic TLDs under the authority of the United States Attorney General.
We have already seen in cases if the ICE domain seizures, improper takedowns and overreach resulting in the takedown of tens of thousands of websites when a single one was the target.
Can a domain name be the difference between success and failure in a business? Are domain names the single best investment one can possibly make in one’s business? These are the main questions debated in an ongoing chain of posts, then my comments, and a follow-up post, and another of my comments and yet another post between myself and Andrei over at DomainingTips.
The conventional wisdom among domainers is that without the domain name, you’re nowhere, or, investing in domain names is the single best thing you can do to achieve some kind of “edge” in the competitive marketplace.
My opinion is different. I think the people who care most about domain names, are domainers. I don’t think that a domain name will be the key to success or failure and I can’t even parse the assertion that anything is “the best” investment because I think that statement is more rhetoric than anything else.
Let’s dissect.
Under a proposed Verisign initiative, all .COM/.NET domains exist at the pleasure of the United States government.
Verisign just released an overview of their proposed “Anti-Abuse Domain Use Policy” Under ICANN’s Registry Services Evaluation Process. The program’s chief aim is to provide a takedown mechanism of malicious websites distributing malware. In itself, not a bad thing, considering some registrars are unresponsive toward abuse or network stability issues.
However, lumped in with the conditions under which Verisign can invoke their takedown capabilities are some troubling “add ons”, as quoted below:
This is a repost of a guest editorial I wrote for Domain Name News.
When one looks at the track record of introducing new Top Level Domains it is perplexing to see where all the enthusiasm around unlimited new TLDs comes from. So far every attempt to roll one out owes it’s sustenance to purely defensive registrations (.biz, .info) or else it’s degraded into an utter fracas (.jobs) or just plain flopped (.pro)
The latest TLD that isn’t a country code tarting itself up as a pseudo-generic is probably a good indicator of what to expect going forward: .xxx – reviled by the industry it extorts , err, purports to serve and first new TLD that we are seriously considering making a conscious decision not to “grab our name before somebody else does!”. I’m certain it won’t be the last. I believe one of the first things we will see as all this unfolds is a buyers strike in defensive regs. Once that happens everything will go sideways.
So despite the near frenzied hype around these things, I have already gone on record to predict failure for the vast majority of them.
The forthcoming onslaught of TLDs can be divided into roughly three categories: Read more »
I just read Rick Spence’s “What’s in a name? It could be a fortune on the Internet“, (HT to HybridDomainer), which seemingly dials the needle back to (pick one), 2005 or 2007, or maybe 2010 and drinks the Kool-Aid every domainer has on an IV drip: the notion that fortune and success can be achieved simply by virtue of “owning the right names” (i.e How can we be bankrupt? Don’t we own TenMillionDollars.com?)
Only in this case, he’s talking about the seemingly impending new top-level-domains. “New domain names will rank above the current crop”, he gushes. Really? You mean now I get to defend my trademark in .www, .website, .bank, .toledo, .xxx and .FML ? Great! I think what we will see happen is a buyers’ strike in defensive names. It will become impossible to defend one’s names in all possible TLDs, brand owners will simply stop doing it, defensive registrations in new TLDs collapse, kicking out one of the two legs holding up most new TLDs (the other being speculative registrations). Read more »
/04/01/11 TORONTO/ – easyDNS Technologies Inc., the ultra-cool DNS guys, today announced it is moving forward to secure .SUX under the ICANN new TLD process.
The .SUX domain is not intended to encourage registrations which disparage any company or entity.
“A number of factors have converged to make this possible”, said CEO Mark Jeftovic, “the new rules permitting vertical integration allow us as to function as Registrar, Registry, root DNS provider.”
Under the proposed terms of the new TLD, sunrise claims will be subject to a non-refundable $10,000 application fee. Landrush applications will ring in at $100/year with an initial term minimum of 10-years. Conflicting applications will be automatically entered into an auction process subject to high-pressure sales tactics and shill bidding.
Jeftovic downplayed assertions that everybody on the internet would be held hostage to defend their marks under a TLD with less-than-flattering connotations, “Nonsense”, said Jeftovic, “there are lots of other perfectly legitimate reasons people would want to register names like citibank.sux, bp.sux or maybe gawker.sux” he explained.
Easydns.sux would be reserved under the TLD and unavailable for registration.
Cyberplex.com (TSX:CX) is Canada’s largest CPA network with a fairly blue-chip customer base including RBC and Jaguar along with net giants like eHarmony and Netflix. They’ve been pretty aggressively growing revenues and earnings over the past couple years and for awhile I counted myself a shareholder. I sold my position last year when they announced their acquisition of Tsalvo (which was once upon a time Geosign). It was highly dilutive to shareholders (expanding the shares outstanding from roughly 80M to 120M+) and I’m not a fan of traffic arb plays because the earnings (while often explosive) are extremely volatile. Read more »
It was just pointed out to me that Banks.com has entered into a sale/leaseback arrangement with Domain Capital for their flagship domain, banks.com.
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