Ugh. I just read that VeriSign is increasing the base cost of .com domains 7%, from $6.00 to $6.42.

Some background: A while ago, ICANN and VeriSign sued each over. In the settlement (as VeriSign has tons of cash, and ICANN doesn’t), ICANN agreed that VeriSign could continue to be the exclusive provider of .com/.net for the next seven years. Furthermore, VeriSign was given the ability to increase the base cost (which at that point was $6.00) upto 7% every year. The word ‘upto’ being useless, as how many corporations decide to go for 5% extra profit instead of 7%?

Anyway, VeriSign, being the opportunistic monopolistic company they are, jumped at the first chance to make some more money.

This is a company that has an exclusive lock on .com/.net domains. For every year I renew this domain, they make $6.00. Now instead, they will be making an extra 42 cents. Going by TechCrunch’s math, that means $27 million extra per year. For doing nothing.

What is rather disheartening are the people spouting out comments over at TechCrunch without having a clue what is going on. The basic arguments:

• Domains used to be $100. Thats great - they used to be free. Stupid argument
• Don’t use them. I don’t know what people are smoking - if you buy a .com or .net, VeriSign will get your money. The low-cost registrars still pay that fee. And they had nothing to do with how ‘cheap’ VeriSign is (ie - they did not exist until the price went down, not vice-versa)
• Domainers. Love them or hate them, it is Google and Yahoo that give them the money on their PPC pages. $6 vs $6.42 - you think that is going to stop domainers?
• Infrastructure. This one really irks me. Do you remember the cost of hosting 10 years ago? 5 years ago? Newsflash: technology makes things cheaper and cheaper. VeriSign states 30 billion DNS queries a day - and yet OpenDNS does over a billion without much problems. Somehow .info operators are able to run a registry at $1-$2 per domain, and that is with much smaller volume. Scale up from 5 million domains to 65 million domains, and the cost per domain goes down, not up.

What is just disgusting is how people are actually defending a monopoly. VeriSign answers to no one (well, they are supposed to answer to ICANN, but just observe the Registerfly debacle and how incompetent they were at that).

If something costs me 50 cents, and I used to charge you $50, but now charge $5 - I’m not doing you a favor - I’m still ripping you off.

We operate a plethora of sites. Some are updated a dozen times a day, some once a year.

The sites that generate the most amazing ROI are usually the ones that are most targeted. For example, we have a rarely updated site based loosely on finance. Today it generated a pithy 28 pageviews. The earnings for today: $18.18.

While that was a super-freak earnings there, the site averages a CPM above $100 (both this month and lifetime - it has been around since early 2005).

Don’t pass on something just because it doesn’t have the potential for 10 million pageviews. You can get by with 1000 sometimes.

Vicodin is a common pain killer from Abbott Laboratories. Many people get addicted to it (including a friend of mine), usually during recovery following from surgery (who doesn’t want to be pain-free?) To quote Wikipedia:

The hydrocodone component of Vicodin is the reason for its abuse. Hydrocodone is an opioid, so its effects are similar to those of heroin (although not quite as strong) and it is highly addictive. It increases the activity of the neurotransmitter dopamine, causing a strong euphoria. Vicodin addiction and withdrawal are also similar to those of heroin.

So when I read this post I just shook my head and laughed. Vicodin.com is owned by Abbott, just like you would expect. But what you won’t expect - the site is just a PPC-landing page.

Sure you can blame the typosquatters and the cybersquatters for all those search results/domains filled with PPC ads, but when a company with over $20 billion in sales is doing domain parking, you know there is no turning back.

While I helped facilitate this sale a while ago (and there was a bit of a ‘quiet period’ going on with it), the go ahead to go public with it is here.

CSSVault, the venerable CSS directory was sold by BloggyNetwork to HostGator Web Hosting for a smooth $100,000.

Revenue and traffic are not going to be disclosed, but lets say the strong brand and strong (actual, and not wishful) potential was a big reason HostGator purchased it.

I will have a follow up interview with Brent Oxley, HostGator’s president soon. He has promised me that the site will be revamped soon. This isn’t a simple purchase - it’s an investment.

Is it just me, or is there not a single web 2.0 company that is actually trying to make it work as an independent?

You may argue Facebook is trying to go that route (every since their facebook query language I have been a super-fan), but I only see it as posturing. They have reported being profitable (at roughly $150 million revenue a year), but other reports are leaking about horrific marketing results. The company is heavily invested in by VCs. And the quickest payout will be through a buyout, hoping Yahoo succumbs.

But lets even say Facebook holds out and goes IPO (or even stays private). What about everyone else? From Delicious to MySpace to unlaunched startups, everyone is getting snapped up.

‘Back’ in the ‘Web 1.0′, the companies wanted to be the winners. From Yahoo to Excite to Lycos, they had no desire to be acquired. They wanted it all. It seems the latest batch of ‘companies’ are just looking to cash out as quickly as possible. And with Alan Greenspan forecasting a possible recession within 9 months, maybe its a good move.

Then again, the web 1.0 survivors went on to become big winners.

American Capital just plunked 160 million into GeoSign. This wasn’t a purchase - it was an investment.

GeoSign is one of my favorite companies on the internet. I ran across them roughly two years, but really got to know what they were upto about a year ago. They do domains (owning fantastic domains like GolfCourses.com and Hockey.com), they do content (a ton of writers/editors), and they do local search (TrueLocal). Take my company, giantize it by a factor of roughly 15, and you have GeoSign

As a follow up Frank has an interview with Tim Nye, GeoSign founder.

This likely won’t make the news on sites like TechCrunch or Read/Write, but this is a significant investment. GeoSign is a strong company, claiming over 35 million unique visitors a month. And since I highly doubt they gave up more than 50%, we can say that this investment values the company at over $300,000,000. In seven years, Tim has taken the company from nothing to such a valuation. Kudos to that success.

I can only guess what they are going to do with that money.

I hate affiliate programs. Not the actual concept, or what happens when you make a sale. Oh no - I hate the actual programs. Many of them are setup in a rather sneaky way that do nothing but try to extract money from your traffic without giving up a dime. And then you have the problem of cookie stealing, and companies building up their brand without paying you a dime - argh!

I make more money from affiliate programs than advertising or sales. But - every single one of the affiliate programs we use (we use 5) all provide XML systems. We are able to complete a transaction without a user ever knowing that we are just a frontend. The most important part here is the provider is never able to exert their brand influence on the end user. Next time User X wants to buy a product, he (or she) will come back to our site and re-purchase. Huzzah!

Actual example: iBegin Toronto. Revenues from ads: $x. Revenue from hotel reservations: $x * 4.

And our partners treat us well. We get solid traffic. We don’t trick our users or annoy them. And we have generated millions in revenue (literally) for them. Its a relationship where both parties try hard to make the most of it.

Speaking of which - none of the companies I work with actually advertise an XML system. We contacted their affiliate manager, talked about the high quality traffic that flows through us, and reached a deal. Simple and easy

[this post catches me up for the weekend so I am again averaging exactly one post per day]