Tag Archives: Minds + Machines

MMX Shows There’s Money In New gTLDs As It Swings Into First Yearly Profit

With domains under management growing 67% to over 1.32 million as of 31 December 2017, compared to 800,000 12 months earlier, Minds + Machines announced they have shown their first annual profit.

As MMX anticipated when they released their interim results in September, MMX enjoyed a strong second half of the year building on the foundations laid in the first half. Billings for the second half of the year amounted to approximately $10 million (compared with $5.6 million in H1) resulting in total billings of approximately $15.6 million for the full year thereby enabling MMX to achieve its first year of profitability as an operating business.

“To have transformed the Company from a loss-making business to a profitable one on an ongoing basis within 24 months is an achievement the whole team should be proud of,” said Toby Hall, CEO of MMX. “2018 has started positively and I look forward to updating shareholders in April with our strategy for building on this profitable platform and delivering value to shareholders.”

As of today, there are 1.367 million domains under management across the 27 new generic top level domains managed by MMX. The largest of these is .vip with 907,000 DUM followed by .work (187,000) and .london (85,000), according to nTLDstats.

The mix of the billings has also continued to improve with renewal revenue now accounting for approximately $5.6 million (2016: $3.8 million). Importantly, recurring income for the first-time has exceeded fixed operating costs which have been reduced to below $5.5 million for 2017 (2016: $6.5 million).

As a result, with billings in line with market expectations, MMX expects EBITDA to be slightly ahead of market expectations, with profit being further boosted by $2.1 million through monies received by the Company from two contested TLD auctions that took place during 2017.

MMX has also continued to strengthen its balance sheet in the year. Net cash at 31 December 2017 had improved to $15.9 million (31 December 2016: $15.3 million) despite settling $3.1 million of balance sheet liabilities in the year associated with contracts restructured in 2016.

The strategic review continues to progress and the benefits of consolidation in the industry remain. Whilst the longevity of the discussions has been at times frustrating, it is hoped that the process can be brought to a successful conclusion by the time of the full year results which are expected to be released in April 2018.

MMX and Radix Get Chinese Approval for 4 More TLDs Each as .BOSTON Launches

mmxco-logoMinds + Machines has just had 4 more of its 27 new gTLDs approved for use in China, adding to the prior approval for .vip. This now makes 5 of its extensions approved by the Chinese government regulator, MIIT – .vip, .law, .work, .beer and .购物(shopping) – with a further four currently still going through the MIIT approval process.

The Company will announce the release schedule on the newly approved top level domains for the Chinese market in due course.

Commenting on the approval, MMX’s Chief Executive, Toby Hall, speaking on the domain industry at Alibaba event ‘The Computing Conference’ in Hangzhou, regularly attended by over 40,000 delegates, said:
“We are greatly honoured to be the first western registry to receive a second round of approvals from MIIT.  China accounts for over half of global registrations in new gTLDs and from a revenue perspective it is important for the Company to have a dominant position in this market.”

MMX’s 27 new gTLDs have almost 1.095 million domains under management, the largest being .vip with 762,000 followed by .work with 116,000 and .london with 75,000 according to nTLDstats.

Another new gTLD registry, Radix, also had 4 of their new gTLDs approved for use in China according to a Domain Incite report. Their new gTLDs to get the nod were .fun, .online, .store and .tech.

Additionally, this week saw the General Availability launch of .boston. The new generic top level domain launched on 10 October and saw over 2,000 registrations being made in the first six hours and approximately $100,000 of billings already booked. According to nTLDstats, registrations are now over 2,150.

MMX Domains Under Management Rise 34% in 6 Months

mmxco-logoIn a period of what Minds + Machines (MMX) refer to as “consolidation”, domains under management (DUM) for the 27 new gTLDs they currently manage has risen 34% in the 6 months to 30 June, according to their unaudited interim results released Tuesday. Today DUM stands at 1.084 million according to nTLDstats.com.

The first half of 2017 also saw top-line billings of $5.6million (revenues $5.3million), which they called “a strong performance given key 2017 inventory releases” were held back until the second half of 2017. The billings and revenue compare to the first half of 2016 where there was $8.1million in billings ($7.4million revenue) driven by the .vip launch.

Other highlights outlined in the MMX statement were:

  • Quality of earnings significantly improved, renewal revenues increased more than two-fold to $2.4million (45% of H1 2017 gross revenue), compared to $1.1million H1 2016 (15% of gross revenue);
  • Central KPI target of renewal billings to be greater than fixed OPEX achieved for first time in period:
    H1 renewal billings nearly tripled to $3.1million;
  • Fixed OPEX reduced 45% to $2.6million when compared to the Group’s full operating costs in H1 2016 (30% when compared to 2016 ongoing operations);
  • H1 Operating EBITDA of $0.2million (H1 2016: $1.1 million) generated in spite of $2.1million lower revenue in period;
  • Net cash contribution of $0.2million generated from operations, $80k ahead of H1 2016;
    Cash and cash equivalents of $14.2 million at period end (H2 2016: $15.3 million), the decrease primarily due to payment of provisioned liabilities;
  • H1 2016 group losses of $1.9million reduced to $0.5million group loss H1 2017 – H1 2016 loss per share of 0.24cents reduced to 0.08cents H1 2017.

“The first half of 2017 has been a period of consolidating the transformational progress of 2016 with the business on course to deliver its maiden year of profitability as an operating business this financial year,” said Toby Hall, CEO of MMX.

“Importantly, the quality of earnings in H1 2017 have dramatically improved. Renewal billings have nearly tripled to $3.1million in the period from $1.1million last year with renewal revenue more than doubling to $2.4million accounting  for 45% of H1 revenue compared to 15% in H1 2016.

“The Company has likewise continued to work hard to manage down costs with fixed operating costs reduced by 30% to $2.6million in H1 2017 when compared to those of the continuing operations of H1 2016 ($3.8million) and by 45% when compared to the Group’s full operating costs in H1 2016. This has allowed the business to achieve one of its central KPI’s  of renewal billings being greater than fixed OPEX for the first time in the period allowing new sales to  increasingly drop to the bottom line.”

“As a result of the completed restructuring, off comparatively lower H1 billings of $5.6m due to the decision to hold back key new inventory releases to H2 – the business has transformed a H1 2016 billings based group loss of $0.5million to a H1 2017 $0.2million profit. And with the current momentum of Q3 sales, where sales of approximately $6million have already been achieved to date, the business is well on course to deliver its first year of profitability. The Directors therefore look forward with confidence, the strategic review process remaining ongoing as the Company and its advisors look to an outcome that can best enable an acceleration of what we increasingly consider to be a de-risked, proven business model that is delivering a balanced mix of revenues across the regions.”

MMX Sells Over $3.4m in Premium .VIP Domains Since late June in China

mmxco-logoSince late June, Minds + Machines (MMX) have sold over $3.4 million in premium .vip domain names, of which approximately $2.8million has closed in the 10 days to 12 September, and mostly to Chinese domain investors.

MMX is expecting a solid second half of 2017 in addition to the .vip sales. The .boston new generic top level domain (gTLD) which they provide registry services for launches in October and they’re entering the main renewal seasons for their leading new gTLDs.

MMX has 27 new gTLDs in their portfolio with 1.085 million domain names under management. The largest is .vip with 762,300 registrations followed by .work (107,500), .london (74,500), and .bayern (31,700). For all but their .country, backend registry services are provided by Nominet.

“We are building a strong, long-term, annuity based business with each of our regions now contributing well to the renewal revenue mix,” said Toby Hall, CEO of MMX.

“The exceptional renewal rates achieved in China in H1 are, in no small part, a direct result of the premium pricing policies introduced at the launch of the .vip TLD. The significant interest we are now experiencing in our 2017 premium inventory allocation follows our recent Beijing approval and, we believe, lays down further foundations for strong recurring revenues in subsequent years from the region.

“These latest sales also mean we are making excellent progress towards achieving management’s top-line billing targets for China for the current year, with more than 60% of our 2017 China premium allocation now sold in recent weeks. These sales, along with the launch of .boston in October, will however further accentuate the H2 weighted nature of our business as we now enter the main renewal seasons for our leading properties in Europe and the US.”

Beijing Gets On Board With the Rest of China Allowing .VIP, .SHOP and .LTD In Boost To All 3

The Chinese market is one that requires lots of perseverance for the operators of TLDs wanting to offer their domain names to local customers. To get approval the registry operator must get approval from the Ministry of Industry and Information Technology (MIIT) first, and then the local regional communications department of the region where the domain owner is based must also recognise the TLD.

To date Beijing, a market of 22 million people, has been the only holdout. But on 16 August MMX’s .vip was the first of three foreign new gTLDs, along with .shop and .ltd, to be recognised by the Beijing Communications Administration. .vip is the first new gTLD in the top 10 by registration numbers to gain this permission. The approval gives the 3 new gTLDs a significant competitive advantage in a region with an economy with a GDP of circa 2 trillion CNY and a rapidly developed start-up/SME business sector.

MMX management also believe this latest permission will further accelerate the transition of those domains originally bought by investors in 2016, before MIIT approval, into the hands of SMEs. Already China's leading search engine, Baidu.com, recognises over 705,000 individual .vip pages from 188,764 different .vip sites and the Company is aware of further initiatives that will directly contribute to this continued usage growth of the domain in the coming months.

From mid November 2017, MMX will also begin selling Chinese character (IDN) .vip names into the Chinese market.

Separately, the MIIT approval process continues to progress on track on up to a further eight TLDs in mmx's portfolio.

.boston Enters Sunrise Phase of Launch

dotboston-logoMMX launched the first phase of availability for the new .boston top level domain on 1 August.

The “Sunrise” phase gives Boston businesses with trademarks first priority in claiming their .boston domain names through August 31. The commencement of the Sunrise phase marks a 70-day countdown until general availability of .boston domains for the public on October 10, 2017.

The next and last phase before general availability — the community phase — will commence on August 8th, at which time .boston domain names will be made available to government entities and non-profit organisations at a discounted rate.

Starting on October 10th, names will be made available to the general public through leading registrars in the US on a first-come-first-served basis. A number of registrars will likely allow pre-registrations starting in mid-September when wider marketing initiatives for  .boston begin.

With the launch of .boston, Boston becomes only the fourth city in the US with a top level domain, providing a unique opportunity for Boston residents, businesses and local organizations to set themselves apart from competitors, and signal their direct association with “The Hub”.

“The rollout of .boston presents an exciting opportunity for the city of Boston,” said Solomon Amoako, VP of Channel Strategy at MMX . “Whether you’re an established brand looking to lay the cornerstone of your digital Boston real estate, a local not-for-profit group or business wanting to open more doors to your organisation with a unique URL, or just a passionate Bostonian looking to show pride in your city through your online presence, .boston has something for everyone.

MMX is the official registry services provider for .boston, supporting .boston’s marketing efforts and operating the technical infrastructure of the new TLD.

For more information on how to get a .boston domain name, please visit nic.boston.

MMX Predicts Higher Than Average .VIP Renewals in China

Minds + Machines (MMX) is expecting higher than average first year renewal rates for its .vip new gTLD in China. Based on early manual renewals, the registry is seeing renewals significantly ahead of those typically seen by new generic top-level domains in the region, according to a statement released 7 June.

MMX uses first year renewal rates as an important internal benchmark. To date, actual deletions for the first 31 days of registrations for .vip from China are currently less than 1%, with manually confirmed renewals for the same period already at over 60%, with the remainder being placed on auto-renew by registrars on behalf of their customers.

Whilst not all of those placed on auto-renew will be renewed, MMX expects the overall renewal rate for the first month of .vip registrations, which will be published in late July, to place .vip in-line with the best-in-class renewal rates of leading western facing top-level domains (i.e. c. 70% and above).

“The .vip renewal rates from China, which have not been reliant on aggressive discounting tactics, are testament to the inherent value of the .vip extension and hard work of our retail partners,” said Toby Hall, CEO of MMX.

“This bodes well for our Chinese premium revenues in H2 as we begin releasing our 2017 .vip premium inventory for the first time to the broader market in Q3, traditionally the main domain investment season in the region, on the back of .vip's exceptionally strong renewal profile.”

MMX is also expanding in China with approvals for 8 new gTLDs currently progressing through the MIIT (Chinese regulator) for potential future release in China.

By domains under management, or registrations, MMX is sixth largest registry operator with 1.104 million domain names according to nTLDstats.com. By new gTLDs under management it’s the third largest with 26 behind Donuts (2.203 million DUM and 197 gTLDs) and Rightside (640,000 and 40). The largest registries by DUM are XYZ.COM with 5.703 million DUM and 6 new gTLDs followed by Famous Four (5.171m and 16), Jiangsu Bangning Science & Technology (one (.top) and 3.943m), Radix (2.342m and 9), Donuts and then MMX.

Is MMX Set For Takeover As New gTLD Industry Consolidates

mmxco-logoMinds + Machines Group Limited (MMX), operator of 26 new gTLDs with 1.1 million domains under management (DUM), has announced that they have received a number of informal approaches from parties interested in purchasing the sixth largest new gTLD registry by DUM.

In an announcement MMX said their Board has appointed US investment banking firm, Headwaters MB, to review the various strategic options open to the Company to maximise value for shareholders.

In the leadup to the approach or approaches MMX has been restructured successfully by the new management team into a profitable business with an increasing recurring revenue stream, a world class asset base, and one of the strongest footprints in Asia following the launch of .VIP and the subsequent MIIT approval in China.

During the last 18 months, the new generic top level domain market has experienced unprecedented growth and trading by MMX has, and continues to, reflect this. Registrations are up over 40% year to date. The sector remains highly fragmented and the review will explore how strategic options might accelerate shareholder value, in particular whether and how MMX can participate in a broader industry consolidation. The outcome of the strategic review may therefore include, but not be limited to, an acquisition by or sale / merger of the Company.

MMX will make a further announcement to update shareholders on progress of the strategic review when appropriate.

MMX 2016 Results Show 40% Registration Growth On Back of Strong Chinese Demand

Domain names under management across the 26 new gTLDs operated by Minds + Machines (MMX) jumped 40% in the last 12 months, with registrations jumping 44% to 817,000 in China on the back of developing relationships in China that has included opening an office in Xiamen, gaining a license for .vip to allow Chinese registrants to host domains within the country and applying for licenses for a further 8 more.

MMX currently operates 26 new generic top level domains with 1.081 million domains under management, according to nTLDstats.com.

MMX released its final results for 2016 to the London Stock Exchange 25 April with the company highlights for the year. The highlights included:

  • successfully transitioned into a pure-play registry on-time and on-budget
  • registrar operations shut down and customers migrated to a registrar partner
  • registry technical back-end outsourced to Nominet
  • cumbersome historic partner contract successfully renegotiated
  • company headcount reduced from 43 to 20
  • board reduced from seven to four
  • business development teams strengthened.

Post period highlights to 25 April were:

  • US and European registrations up 37% to circa 350,000;
  • China registrations up 44% to over 817,000
  • launch of .boston scheduled for release in September 2017
  • new gTLD market growth up circa 6% year-to-date at over 29 million domain name registrations
  • full year 2016 billings up 100% to $15.8million (2015: $7.9million)
  • full year 2016 revenue less partner payments up 146% to $13.5million (2015: $5.5million)
  • full year 2016 gross profit up 159% to $10.9million (2015: $4.2million).

“To understand the key market drivers of the new gTLD industry that saw net new registrations outstrip those in .com and the country codes combined in 2016, it is important to recognise the trends both from within the industry as well as external factors,” said Toby Hall, CEO of MMX.

“It is therefore central to our strategy that we are positioned to support the three end markets that management sees are looking to benefit from those trends through our registrar partners – namely; new-start SME's that are coming online for the first time, as well as established businesses already online; digital entrepreneurs that are looking to develop significant new markets and applications based around domain address conventions and domain investors who serve both as early pioneers, as well as marketeers, of new extensions.

“We believe much of the business development work and tests we have been conducting over the last 12 months are now providing the backdrop to the growth the portfolio is now enjoying and will, we believe, continue to enjoy.”

“We continue to have significant scope for billings and revenue improvement as the Group's premium and standard name inventory across its world-class portfolio of top-level domains is better monetised.

“In short, the progress we made in 2016 to restructure the business into a pure-play registry and cost efficiently enter new markets has built strong foundations for the current year and beyond. We therefore remain confident of our ability to deliver meaningful value as we continue to grow our domains under management and resulting revenues and transition the Group into a highly predictable annuity based business of scale.”


MMX Sees One Million .VIP Registrations By End of 2017 On Back of Strong Chinese Demand

Demand from Chinese investors in new gTLDs remains strong and is largely responsible for the recent 200,000 new registrations in .vip, valued at $1.3 million, the registry MMX (Minds + Machines) has reported.

The announcement comes as registrations for the 1215 new gTLDs to have been delegated passed the 29 million mark on 31 March, according to nTLDstats.com. The largest remains .xyz with 6.617 million followed by .top (4.510m), .loan (1.954m), .win (1.193m) and the only other with more than one million registrations, .wang (1.091m). It is interesting to note there are currently almost 2.995 million domain names in the “upcoming deletes” status.

The orders for .vip comprise both standard names and premium names, including 61 premium domain names sold via the recently completed eName auction. The order contracts also ensure high renewal rates for the new registrations and a guaranteed minimum of $1.3 million of income payable to MMX over the life of the contracts.

It is expected that the registrations will show on industry sites tracking new gTLD registrations, such as nTLDStats.com, over the next ten days and will take total registrations in .vip to in excess of 800,000. Currently nTLDstats.com shows .vip with 796,000 registrations and is the seventh biggest new generic top level domain by domains under management.

“The latest registrations underline the ongoing vibrancy of the Chinese domain name market and the long-term potential of .vip both in China and potentially the wider Asia region,” said Toby Hall, CEO of MMX. “It also bodes well for the upcoming first-year renewals season following the industry breaking first month launch of .vip last May. Management is confident of its ability to exceed the 2017 one million registration target set for .vip.”

MMX has identified a number of factors which it believes is driving .vip's growth in China, namely:

  • domain investors recognising the long-term relevance of .vip web extensions for China's burgeoning SME market as well as the region's established corporates
  • the first mover advantage generated for .vip in China via it gaining MIIT regulatory approval (announced December 2016)
  • the supportive entrepreneurial environment within the China's fast growing internet industry
  • the strength of MMX's in-country management team and in-country distribution partners.

MMX also announced that a Heads of Terms agreement announced on 21 March 2017 regarding mmx's geographic TLDs has now proceeded to contract on the first of the geographic TLDs with the second to proceed in due course. The Directors believe the agreement will lead to a material increase of registrations in the two relevant geo TLDs over the next twelve months.