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Rivals Pass Web Domain-Name King

Internet: Toronto and N.Y. companies top Network Solutions in net new registrations.

March 09, 2001|From Reuters

In a sign that its dominance of the domain name registration market may be on the wane, Network Solutions Inc. was passed by two upstart registrars in one measure of the race to sign up consumers to new domain names, according to a report posted this week by the Web's premier naming authority.

Executives at VeriSign Inc. of Mountain View, an Internet security vendor and parent company of Network Solutions, immediately disputed the implications of the report posted on the Web site of the Internet Corp. for Assigned Names and Numbers (ICANN).

Tucows Inc., a Canadian company, and New York-based Register.com Inc. both recorded more net new registrations of Web site addresses that end in .com, .net and .org than Network Solutions for the first time in the quarter ending Dec. 31, 2000, according to the ICANN report.

Toronto-based Tucows led with 15.97% of overall net new registrations, while Register.com was second with 15.26% of net new registrations.

Net new registrations is a measure of the number of new domain names added by the registrar, minus the number of previously signed up domain names it did not renew, or were re-registered by customers through other registrars.

Network Solutions, a wholly owned subsidiary of VeriSign, had only 14.26% of net new registrations, a steep drop from 40.66% in the prior calendar quarter.

ICANN figures distort the company's true share of the domain name market, which is closer to 35%, said Bob Korzeniewski, executive vice president of VeriSign.

"We have lost significant market share," Korzeniewski said. "But the ICANN data has too many issues associated with it" to be considered accurate.

Korzeniewski attributed the dramatically lower number of net new registrations by Network Solutions to a large number of expired domain names that its customers declined to renew. He said the number of non-renewed domain names will be smaller this quarter.

The number of domain name registrations, which garner registrars like Network Solutions or Tucows about $30 per name per year, are sensitive to VeriSign, whose revenue and stock price rely strongly on perceptions of growth in its domain name business.

At its last earnings call, VeriSign said its registrar business signed up 1.9 million domain names in the quarter, down 14% from 2.2 million domain names in the prior quarter.

VeriSign was down to $44 in after-hours trading on Instinet, below its 52-week low, after falling 5% in regular Nasdaq trading to $44.63 Thursday. The stock is about 83% off its 52-week high of $255.

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