A Sad Day for Australian Domain Name Industry

On Wednesday, 2 April 2014 this week I received an email announcing this:

We are very pleased to announce that Melbourne IT has officially acquired Netregistry Group Limited. As a valued partner of Netregistry Group, which includes TPP Wholesale, we would like to assure you that no changes will be made to your services, platform or pricing.

In group formation, my colleagues and I together weep and rocked in the fetal position after reading this announcement.

Why? Anyone who has been in the Australian IT industry for long enough and has anything to do with websites and domain names will tell you that Melbourne IT are a massive and evil giant that has dominated the domain name market in Australia since the beginning.

The price of .au domain names has always been exceptionally higher compared to other top level domains such as the .com – which is fine – but giants like Melbourne IT kept the retail prices of .au domains high. In fact today you can purchase a .com.au domain name from Melbourne IT for the small price of $147 AUD including tax for 2 years.

In comparison, Netregistry, another large and successful competitor in the same industry has been offering significant competition to beasts such as Melbourne IT. Today you can purchase a .com.au from Netregistry $27.96 AUD including tax for 2 years. That’s a difference of $119.04 AUD. As you can imagine, the wholesale price paid is significantly less than that.

This is what us simple people call “competition”. It’s intended to keep the big guys honest and looking over their shoulder. This is healthy in an industry for consumers. This merger however, reduces competition and is a slippery slope to a monopoly in Australia. Australians have a lot of experiences with monopolies (cough cough Telstra cough).

The .au Domain Administration publishes a list of authorised registrars on their website with a count of 40 registrars. But when we start to group these brand names together into parent company entities, multiple brands owned by the same company, “close” partnerships with particular note of overseas ownership (primary focus is not in Australia) – the list starts the look smaller.

Actually, let’s do that, below is a list of groupings of authorised au domain registrars in Australia.

• Anchor (Looks Australian)
• APEX IT (also trading as Pronail.com.au ?)
• AussieHQ (owned by Jumba / UberGlobal)
• Cheaper Domains
  • Discount Domain Names (DDNS)
• CSC Global (overseas multinational company)
• Domain Central (Bottle Domains, Name.com.au, Australian Style Group Pty Ltd)
  • Explorer.net.au
• Domain Registration Services
• Domain Shield (associated with trademark law firms)
• Enetica (Australian company, registered in 1999, traded domains from 2002)
• Fabulous.com.au
  • Drop
  • Yexa
• GoDaddy (US owned)
• GoHosting
• iiNet (Not a registrar but a common parent company)
  • ConnectWest.net.au (owned by iiNet)
  • Westnet Hosting (owned by iiNet)
• Instra (Australian companies Instra Corporation Pty Ltd / Domain Directors Pty Ltd also run Europe Registry)
• IntaServe (US based [Intaserve LLC], DiscountDomains.com.au, Indigo)
• InterNetX (German owned)
• MarkMonitor (owned by Thomson Reuters USA)
• Melbourne IT
  • Netregistry
    • NetFleet
    • PlanetDomain
    • TPP Internet
    • TPP Wholesale / Distribute IT
    • ZipHosting
  • (Web Central – Australian web hosting company)
  • (Domainz – NZ domain company)
• Name Scout (owned by Momentous Corporation in the US)
• NetLogistics (Turbo Servers)
• OpenSRS (owned by Tucows in US)
• PublicDomainRegistry (US parent company)
• Safenames (based in UK)
• SmartyHost (Owned by MYOB Technology)
• Sublime IP (JustNet, GoCommerce, DIALix)
• VentraIP (Zuver, VentraIP Wholesale and has an associated US company)
• WebAccess (Oz Servers)
• WebIP
• WebRegistrar (Web Address Registration Pty Ltd)
  • Appointed reseller: Crazy Domains / Dreamscape Networks FZ-LLC

Hmmm. That list of 40 registrars is really only 29 companies.

Perhaps we should do some further grouping on core business activity and country of ownership. Note the quantity is calculated by the single parent entity.

Australian Domain Name Seller / Service Provider (10)

• Cheaper Domains
  • Discount Domain Names (DDNS)
• Domain Central (Bottle Domains, Name.com.au, Australian Style Group Pty Ltd)
  • Explorer.net.au
• Domain Registration Services / Domain Name Registrar (Australia) Pty Limited
• Enetica (Australian company, registered in 1999, traded domains from 2002)
• Fabulous.com.au (part of the Dark Blue Sea group)
  • Drop
  • Yexa
• GoHosting
• iiNet (Not a registrar but a common parent company)
  • ConnectWest.net.au (owned by iiNet)
• Instra (Australian companies Instra Corporation Pty Ltd / Domain Directors Pty Ltd also run Europe Registry)
• Melbourne IT
  • Netregistry
    • NetFleet
    • PlanetDomain
    • TPP Internet
    • TPP Wholesale / Distribute IT
    • ZipHosting
  • (Web Central – Australian web hosting company)
  • (Domainz – NZ domain company)
• WebRegistrar (Web Address Registration Pty Ltd)
  • Appointed reseller: Crazy Domains / Dreamscape Networks FZ-LLC

Australian Web Services / Hosting Seller (9)

• Anchor (Looks Australian)
• APEX IT (apex4web, also trading as Pronail.com.au)
• AussieHQ (owned by Jumba / UberGlobal)
• iiNet (Not a registrar but a common parent company)
  • Westnet Hosting (owned by iiNet)
• NetLogistics (Turbo Servers)
• SmartyHost (Owned by MYOB Technology)
• Sublime IP (JustNet, GoCommerce, DIALix)
• VentraIP (Zuver, VentraIP Wholesale and has an associated US company)
• WebAccess (Oz Servers)

Overseas Owned (6)

• CSC Global (overseas multinational company)
• GoDaddy (US owned)
• IntaServe (US based [Intaserve LLC], DiscountDomains.com.au, Indigo)
• InterNetX (German owned)
• OpenSRS (owned by Tucows in US)
• PublicDomainRegistry (US parent company)

Brand Management Companies (5)

• Domain Shield (associated with trademark law firms)
• MarkMonitor (owned by Thomson Reuters USA)
• Name Scout (owned by Momentous Corporation in the US)
• Safenames (based in UK)
• WebIP

So as you can see, from the list of 40 registrars, after the acquisition of Netregistry by Melbourne IT, the list of Australian providers offering domain name sales as their core business activity just got smaller.

Is this a good thing for competition in Australia? One of the largest providers just bought another large provider – that’s a significant shift in market share and power in the industry.

The acquisition is pending regulatory approval from the Australian Competition and Consumer Commission and .au Domain Administration. It has however been suggested they’re unlikely to take an interest.