GoDaddy expands its grasp on domain market with Neustar purchase

We live in turbulent (pandemic) times when considerable monetary resources shift globally. This is the exact time when the big fish eats the little fish. In this particular case, we have witnessed a strategic move by GoDaddy Inc.

Was acquiring Neustar the only option for GoDaddy?

Up to now the company offered domain registration service but was not a domain operator, though with the purchase of Neustar Inc Registry business they have become one.

Arguably, experts would question why GoDaddy did not get the registry side of Uniregistry, and it may be so that they went for the “better registry backend” or overall better business with Neustar.

Which domains did GoDaddy acquire as a registry?

This acquisition was much more likely as per some sources GoDaddy and Uniregistry did not have a great history of doing business. Now GD actually unlisted some of the Uniregistry domains from the registration service.

It is quite an extensive portfolio of domain names that GoDaddy acquired through this purchase, including .BIZ, .CO, .IN, .NYC and .US with over 200 more TLDs including the Managed Registry Services business that provides end-to-end registry management for over 130 brand TLDs and 70 generic TLDs.

Is it a merger or a healthy partnership?

In the announcement following the purchase, we quote GoDaddy’s official saying: “For more than two decades, GoDaddy has used its consumer insight to drive innovation in the domain industry and we’ll continue to do so by creating more choice and value for consumers.”

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The new service will be named GoDaddy Registry, which is not a surprise, and should be somewhat independent of the registrar business. This was expected by industry competitive domains market and previous Neustar business partners.

What does this mean for the domain market?

The domain market connoisseurs would note that this clearly means original “legacy” generic top-level domains and ccTLD have a higher value than new gTLD, given that Uniregistry operates a portfolio of new gTLD.

Previous records of Neustar being sold for $2.9 billion in 2016 mean it could only be much more today.

This being a vertical acquisition aiming for an underlying monopolizing of the domain market and it is expected to hurt smaller registrar companies.

Conclusion

The expansion of such a company into a larger one is threatening as with GoDaddy there are no larger companies that can follow suit and compete with their economic development.

The next possible move would be to acquire after-market marketplace websites such as Flippa and influence closing the circle. Will this be causing domain market monopoly, while the next domain market battle will involve GoDaddy vs Verisign?