Caroline Greer, Head of European Public Policy at Cloudflare, posted a tweet with the reported sale price of PIR, the operator of the .org registry. I do not have a way to independently verify the report or confirm it’s accuracy, but I reached out to Ethos Capital to confirm the sale price:
.@internetsociety webinar delivers news of the sale price of PIR > $1.135 billion, a perpetual endowment which will be managed under a new governance structure. Central issue for ISOC in considering the sale has been the risk of reliance on one sole industry (domain names).
— Caroline Greer (@CarolineGreer) November 29, 2019
Kieren McCarthy also reported this sales figure on Twitter, although I do not know if his source is the same as the one I shared:
So apparently ISOC has finally confirmed the amount it will be paid for .org: $1.13bn. Exactly what I thought ("a little over a billion"). What does that mean? Here's my quick calculations…
— Kieren McCarthy (@kierenmccarthy) November 29, 2019
Kieren also shared some back of the napkin math to illustrate how big of of an opportunity this is for Ethos:
But, give it to Ethos, this is a smart business move. Just amazing that they persuaded ISOC to go for it
— Kieren McCarthy (@kierenmccarthy) November 29, 2019
As a .com domain name investor, I do not agree with ICANN’s decision to remove price caps for .org domain names because it will likely lead to the same for other legacy extensions like .com. That said, this was a shrewd acquisition for Ethos Capital, and it has the potential to be very lucrative for the company and its investors.
I will try to share an update if I read any independent confirmation of the sale price.
$20m /year costs to run.
$100m /year revenues from renewals at current price cap.
What an insane low multiple for a nearly risk free / easy to predict kind of business. Ridiculous..
Pretty good deal ihmo when you consider they can raise prices however much they want.
They will double the .org price in 10 years, IPO at 20x around $4b market cap and walk away billionaires.
Because .org domain names are highly inelastic – this is a great opportunity for Ethos Capital to increase its prices on a captive base of users, who has no reasonable substitutes.
Ethos Capital now has a fiduciary duty to increase prices to maximize its returns for its new shareholders (including ICANN past CEO Fadi Chehade.)
ICANN is no longer fulfilling its competition mandate. Because .org does not compete against any other domain extensions – it is a natural monopoly. ICANN has been operating under the misguided belief that the new gTLD program has created more competition – but this is not true. This is especially not true with existing registrants – who have been using their .org domain name for many years – they are simply not able to switch.
Any price hike (either small or large) will be forced upon the base of 10+ million registrants.
Yes, they are going to raise prices, get serious cashflow on the books, then flip this for $4B.
Everyone at ICANN will get rich YAHHHHH
Richard is exactly correct. Although at 10% escalating prices per year, the wholesale cost will be $26 in 10-years’ time.
Despite the fact that the cost to operate .org continue to go down. It costs $18,066,321 to operate in 2018.
Get ready – PIR / Ethos Capital will have one of the highest margins of any company on earth!
Operating a monopoly is a dream for any private equity company.
License to print ever increasing amounts of money at the expense of the public and society – good deal if you can get it.
I.e., good deal if you can engage in various forms of bribery and influence buying to get it.
Such a shame. Curious what regulation agencies are looking to finally dismantle ICANN as it is clearly operating a racket. Protecting the monolpolists. CRAZY
My understanding is that with the removal of US oversight they are accountable to nothing and to no one and are free to run every racket they please and sell out everyone to the highest bidder.
There’s plenty of evil and corruption to go around on every side of the spectrum here in the US, but nonetheless US oversight was working, was not broken, did not need fixing, and was a huge mistake (or deliberate “mistake”). I doubt anything like this could have gotten this far were it not for that, including the removal of .org price controls, and not even under the last few pro-elite, pro-plutocracy, pro-oligarchy administrations.
Including the current one.
ISOC gave .ORG away and ICANN let it happen. Shame on you both!
How dare you! Do you think mansions, private islands and mega-yachts maintain themselves, or buying favorable legislation and regulation pays for itself? It takes money for that, and it has to be extracted from somewhere (unless you’re the Fed private bank cartel and can print it as interest debt others have to pay, that is).
Whatever John or whoever you are.
It’s called humor, the most painfully blatant kind. Look it up sometime.
ISOC sold out way too cheap.
And in their rush to sell out to private equity, they threw their nonprofit “community” under a bus.
Naivete and greed on ISOC’s part. Opportunism and greed on the part of those behind “Ethos.”
“The .ORG Sale Is a Radical Departure That Puts the Internet at Risk”
By Jacob Malthouse
http://www.circleid.com/posts/20191128_dot_org_sale_is_a_radical_departure_that_puts_internet_at_risk/