Brokers The Sale Of Meet.Me For A World Record Price Of $450,000

I’m proud to announce that has successfully brokered the sale of the domain name Meet.Me for $450,000 in what we believe is a world record price for a .Me domain name.

The Domain was jointly owned by My company, Worldwide Media, Inc., Rick Schwartz and Ammar Kubba.

The domain name was acquired at the silent portion of a TRAFFIC auction for $5,890 back just over three years ago.

The domain will become the 7th highest sale of the year on YTD chart and the 3rd highest sale of the year.

Beyond the money, there are some other important takeaways from the sale.

1.  It’s a recent transaction.

Some of us older domainers (and it pretty hard to find domainers older than myself and Rick, although it should be noted that Rick is MUCH older) get tired of hearing that we are only successful because we got started back in the day, usually meaning the mid to late 1990′s and are riding out all of those hand registered domains all these years later.

Here is a domain that was purchased just a few years ago in an auction opened to all and for a pretty modest sum.

I believe there was only one other bidder in this auction and the reserve was set at $5K.

The domain name was bought from the Registry who at the same auction sold and which we as a group also purchased.

As a personal note being involved in a sale with Mr. Schwartz is quite an education even for an old domainer like myself and the power of the word “no” that Rick frequently chats about cannot be underestimated.

2.  The buyer is a big boy

There is another line of reasoning that I see in many comments that buyers of a non-com are uninformed or simply can’t afford the .com.

They buyer is a public company and owned the matching .com but still felt it important enough,  $450,000 important enough,  to get the matching .me domain.

In actuality the buyer got a great deal.

With this .com they have locked up the space and is in a position to take there online conferencing business to the next level.

3.  The bar has been raised on .Me domain name values, especially the domains with verbs, call to action type of domains as well as other bang on domain in other right of the dot extensions other than .com.

I have spoken about the expansion of the domain space for a few years and people have accused me on on other blogs & forums that I’m shilling for new extensions.

I guess they have ignored that I have actually invested hundreds of thousands of dollars, putting my money where my mouth is.

The only reason we sold the domain at this level was to raise the bar on valuations of other .Me domain names which we jointly and individually own.

Of course it also raises the value of .Me domains owned by a lot of domain investors.

Great domains for the extension, just got a huge boost.

No it doesn’t make a crappy .Me worth more but domain names like,, that we own jointly as well as domains I own like and are worth more now.

Yes I see opportunities in the right of the dot extensions.

At the most recent TRAFFIC Conference auction we once again were a buyer of a new extension this time .XXX.

Don’t be surprised to see a similar story to this one in a few years announcing the sale of one of those domain names.

Yesterday we saw a .ly sell for $100K

The domain space has an is going to continue to expand.

It’s just not a 100% .com world any more.


Switch Communications Files Federal Lawsuit Against Buyer Of Switch.Net

According to, the dispute over the domain name which was won on for $3,700 on November 18th which had a UDRP filed against in 2 days after acquisition by a Swiss company, is now the subject of a federal lawsuit filed under the Anticybersquatting Consumer Protection Act.

“Switch Communications Group LLC, operator of a big data center in Las Vegas, sued a Canadian man on Wednesday in what it calls a trademark dispute.”

“Switch charged in the suit that Dorian Banks in Vancouver, British Columbia, infringed on Switch’s trademarks when Banks registered the Internet domain name last month.”

“Besides the trademark claim, the lawsuit also alleges that Banks violated the federal Anticybersquatting Consumer Protection Act because Banks had a “bad faith intent to profit from registering, trafficking in or using a domain name or mark that is either identical or confusingly similar to a distinctive mark” or a famous mark.”

“Switch charged in the lawsuit that after registering the name on Oct. 15, Banks contacted the Las Vegas Switch company and offered to sell it the domain name for about $3,700.”

“While plaintiff evaluated the offer to negotiate the purchase of the domain name, defendant threatened to sell the domain name to another entity if plaintiff did not hurry and open escrow to buy the domain name,” charged the lawsuit filed in federal court in Las Vegas by attorneys at the Las Vegas office of the law firm Greenberg Traurig LLP.

“Switch in the suit asks the court for a restraining order requiring Banks to stop using Switch Communications’ names and trademarks and that the domain name registrar transfer the name to Switch Communications.”

“Banks, in an interview, denied the allegations of trademark infringement and cybersquatting.”

“He said the domain name was locked down after the auction because of a protest by a third company in Switzerland called SWITCH, which offers services to Swiss universities and Internet users.”

“Banks said that after the Swiss company objected to his registration of the name, he offered to sell it to the Las Vegas company for what he paid for it.”

“That way, he said, the Las Vegas company could try to gain control of the name and he could quit worrying about the dispute.”

“Asked about being branded in a lawsuit as a trademark infringer and cybersquatter, Banks said: “It really bothers me.””

The story which was pretty strange from the start where the auction winner which was initially  facing just a UDRP and potential loss of the domain, is now facing $100K fine plus the costs of defending a federal lawsuit which can be quite substantial.




Highlights From Tucows Earnings Call

Tucows had an earnings call after releasing its financial results for the third quarter of 2011.

Here are the highlights from the call:

Revenue grew by in excess of 18% year-over-year topping $25 million for the first time.

Cash provided by operating activities for the quarter was a healthy $1.6 million.

In OpenSRS domain services revenue and transaction volumes were each up 19% compared to the third quarter of last year.

We processed more than $2.1 million transactions in Q3, the first time we’ve exceeded that threshold and the third consecutive quarter we have surpassed the $2 million mark.

New registrations grew by 15% excluding the impact of the two customers that became registrars earlier this year.

Renewals were particularly strong increasing by 24% with the renewal rate continuing to hold steady at a level well above the industry average.

Total domains under management at the end of the quarter was up 16% from a year earlier to more than 11.7 million, the result of solid growth in transactions as well as the 400,000 domain names that were added with the acquisition of EPAG which was completed in July.

YummyNames, our domain portfolio group had an especially strong quarter with revenue up 46% from the same quarter last year and 38% from Q2 of this year.

Sales of individual names or Brandable and Gems grew 30% compared to the third quarter of last year with average selling price reaching an all time high.

This quarter we had a good number of individual name sales in excess of $10,000.

In addition, there was strong growth in expiry stream sales following our move to a new partner.

Parking revenue was also up marginally compared to the third quarter of last year turning around a long term trend of decline.

Gross margin from YummyNames increased $536,000 or 50% to $1.6 million from $1.1 million for the same period last year.

The increase primarily reflects the timing of portfolio domain name sales as well higher expiry stream sales following our move to a new partner.

On a percentage basis, gross margin for YummyNames increased to 90% from 86% for Q3 of last year.

Gross margin for Hover increased $96,000 or 13% to $863,000 from $767,000 for Q3 of last year primarily as a result of our ongoing success in attracting and retaining customers through our marketing and branding initiatives.

Cash and cash equivalents at the end of the third quarter of 2011 were $4.7 million down from $5.4 million at the end of the third quarter of last year and up slightly from $4.3 million at the end of the second quarter of this year. To Roll Out New Beta Version Of Site Today is rolling out a major upgrade to its site today.

I have been playing with a Beta Version of the site for a few days and I really like the new format.

The site has a cleaner look and feel to the site, and find its easier to navigate backorders, active auctions, reports and general browsing.

The front page has “NameJet Hot Picks”, which are “hand selected hot domains”, Last Chance where you will find a list of pending delete domains that already have backorders, pre-release domains and “New Arrivals” which features some of the newest domain in the system.

According to NameJet the site is mobile ready and much easier to use on phones and tablets.

The front page even features a QR code for pulling up NameJet on your cell phone (of course you need a QR reader app) but I tried it and it worked well.

Also says the advanced search on the new version of the site better utilizes related terms. also says they will be adding features to the site including categorized inventory which promises to help you better find the domains that you are looking for.

The beta site will be available to all users shortly via banner on the homepage.


Tucows Swings To a Slight Loss: YummyNames Sells $1.785 Million In Domains & Announces A $10 Million Stock Buy Back Program

Tucows Inc. (NYSE AMEX: TCX, TSX:TC),  reported its financial results for the third quarter ended September 30, 2011 after the market closed today.

The company had a $.02 loss per share for the quarter vs a $.02 profit for the same quarter last year

YummyNames sold $1,785,000 in Domains vs only $1.250 million in the same quarter last year

Tucows also announced today a stock buyback program to repurchase up to $10 million of Tucows common stock.

Under the program, Tucows may, during the twelve-month period commencing November 15, 2011 and ending November 14, 2012, repurchase up to 3,840,000 shares of its common stock, which amount represents approximately 10% of the public float of Tucows.

During Tucows’ previous stock buyback program, which ended on September 9, 2010, Tucows repurchased 3,409,300 common shares.

Shares Of Tucows were pretty much unchanged during trading today.

Shares of Tucows are not traded after the market closes.

Here is the full earnings report

All figures are in U.S. dollars.

Summary Financial Results
(Numbers in Thousands of US Dollars, Except Per Share Data)

3 Months
September 30,
3 Months
September 30,
9 Months
September 30,
9 Months
September 30,
Net revenue 25,094 21,209 70,695 62,501
Income before provision for income taxes
and change in fair value of forward exchange contracts
1,423 966 3,350 2,784
Net income (loss) for the period (1,152) 1,083 141 880
Net earnings (loss) per common share (0.02) 0.02 0.00 0.01
Net cash provided by operating activities 1,628 1,876 3,215 4,428

Summary of Revenues and Cost of Revenues
(Numbers in Thousands of US Dollars)

Revenue Cost of Revenue
3 Months Ended
September 30,
2011 (unaudited)
3 Months Ended
September 30,
2010 (unaudited)
3 Months Ended
September 30,
2011 (unaudited)
3 Months Ended
September 30,
2010 (unaudited)
Domain Service 19,698 16,517 16,470 13,818
Email Service       636 578 74 97
Other services 1,212 1,086 433 417
Total OpenSRS services 21,546 18,181 16,977 14,332
YummyNames 1,785 1,249 179 180
Hover 1,358 1,147 495 380
Butterscotch 405 632 8 12
Network, other costs - - 1,193 1,088
Network, depreciation and amortization costs - - 183 306
Total revenue/cost of revenue 25,094 21,209 19,035 16,298

“The momentum of the first half of 2011 continued into the third quarter, which was highlighted by strong growth and solid cash flow from operations, as well as the acquisition of EPAG Domainservices,” said Elliot Noss, President and Chief Executive Officer, Tucows Inc.  “Revenue was up more than 18% year-over-year to a record $25.1 million, with meaningful growth across all key areas of our business.  The OpenSRS domain service had another solid quarter with 19% year-over-year growth in registrations and a third consecutive quarter of domain registrations in excess of 2 million.  YummyNames and Hover also had strong quarters as we continue to see the positive results of initiatives we have undertaken to grow those businesses.  Quarter after quarter, our financial performance underscores the consistency and reliability of our business, combined with our ability to achieve steady growth.  We remain well positioned to consistently generate cash flow from operations while introducing new services with minimal impact on operating expenses.”

Net revenue for the third quarter of 2011 increased 18.3% to $25.1 million from $21.2 million for the third quarter of 2010.

Income before provision for income taxes and change in fair value of forward exchange contracts for the third quarter of 2011 increased by $0.5 million, or 47%, to $1.4 million from $966,000 for the third quarter of 2010.  Net loss for the third quarter of 2011 was $1.2 million, or $0.02 per share, primarily the result of the impact of the non-cash foreign exchange losses incurred on the fair value of forward exchange contracts. Net income for the third quarter of 2010 was $1.1 million, or $0.02 per share.

Deferred revenue at the end of the third quarter of 2011 was $68.9 million, an increase of 10.6% from $62.3 million at the end of the third quarter of 2010 and an increase of 3.1% from $66.8 million at the end of the second quarter of 2011.

Cash and cash equivalents at the end of the third quarter of 2011 were $4.7 million compared with $5.4 million at the end of the third quarter of 2010 and $4.3 million at the end of the second quarter of 2011.  Operating cash flow for the third quarter of 2011 was $1.6 million and the Company borrowed $2.5 million under its amended credit facility with Bank of Montreal to fund the acquisition of EPAG Domainservices GMBH (“EPAG”) in July 2011.  In August 2011, the Company repaid $1.0 million of the EPAG loan and during the quarter repaid $320,000 of its previous outstanding balance on its credit facility.  In addition, the company invested $139,000 in acquiring property and equipment.  As of September 30, 2011, the Company had an amount payable of $1.6 million under its amended credit facility.

Conference Call

Tucows management will host a conference call today, Wednesday, November 9, 2011 at 5:00 p.m. (ET) to discuss the Company’s third quarter 2011 results. Participants can access the conference call via the Internet at

For those unable to participate in the conference call at the scheduled time, it will be archived for replay both by telephone and via the Internet beginning approximately one hour following completion of the call. To access the archived conference call by telephone, dial 416-849-0833 or 1-855-859-2056 and enter the pass code 22092643 followed by the pound key.  The telephone replay will be available until Wednesday, November 16, 2011 at midnight. To access the archived conference call as an MP3 via the Internet, go to

About Tucows

Tucows is a global Internet services company. OpenSRS manages over eleven million domain names and millions of email boxes through a reseller network of over 12,000 web hosts and ISPs. Hover is the easiest way for individuals and small businesses to manage their domain names and email addresses. YummyNames owns premium domain names that generate revenue through advertising or resale. is an online video network building on the foundation of Tucows Downloads.  More information can be found at

This release includes forward-looking statements as that term is defined in the U.S. Private Securities Litigation Reform Act of 1995.  In particular, this release includes forward looking statements regarding our expectations as to our financial results, our future growth and our ability to generate cash and return capital to shareholders.  These statements are based on management’s current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements.  Information about potential factors that could affect Tucows’ business, results of operations and financial condition is included in the Risk Factors sections of Tucows’ filings with the Securities and Exchange Commission. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. All forward-looking statements are based on information available to Tucows as of the date they are made.  Tucows assumes no obligation to update any forward-looking statements, except as may be required by law.

TUCOWS is a registered trademark of Tucows Inc. or its subsidiaries. All other trademarks and service marks are the properties of their respective owners.

Tucows  Inc.
Consolidated Balance Sheets
(Dollar amounts in U.S. dollars)

September 30, December 31,
2011 2010
(unaudited) (unaudited)
Current assets:
Cash and cash equivalents $ 4,653,765 $ 4,205,729
Accounts receivable 4,289,462 3,021,995
Prepaid expenses and deposits 3,756,375 2,363,876
Derivative instrument asset, current portion 1,090 833,960
Prepaid domain name registry and ancillary services fees, current portion 43,005,543 37,016,871
Income taxes recoverable 330,093 620,000
  Total current assets 56,036,328 48,062,431
Prepaid domain name registry and ancillary services fees, long-term portion 12,693,752 12,820,479
Property and equipment 1,313,611 1,552,349
Deferred financing charges 4,500 15,600
Deferred tax asset, long-term portion 3,569,000 4,155,600
Intangible assets 17,741,695 16,883,401
Goodwill 18,873,127 17,990,807
  Total assets $ 110,232,013 $ 101,480,667
Liabilities and Stockholders‘ Equity
Current liabilities:
Accounts payable $ $ 1,301,612 $ $ 1,664,006
Accrued liabilities 1,720,279 1,346,436
Customer deposits 3,903,564 3,960,312
Derivative instrument liability current portion 1,193,751 -
Loan payable, current portion 1,559,722 1,305,883
Deferred revenue, current portion 52,372,852 45,832,374
Accreditation fees payable, current portion 562,374 547,810
Deferred tax liability, current portion 569,000 1,155,600
Income taxes payable 200,940 -
  Total current liabilities 63,384,094 55,812,421
Derivative instrument liability long-term portion 431,483 -
Deferred revenue, long-term portion 16,564,604 16,738,429
Accreditation fees payable, long-term portion 159,614 168,580
Deferred rent, long-term portion 19,274 -
Deferred tax liability, long-term portion 5,373,600 4,840,000
Stockholders’ equity:
Preferred stock – no par value, 1,250,000 shares authorized; none issued and outstanding - -
Common stock – no par value, 250,000,000 shares authorized; 53,477,874
shares issued and outstanding as of September 30, 2011 and 53,448,591
shares issued and outstanding as of December 31, 2010
11,349,613 11,324,866
Additional paid-in capital 40,938,602 40,700,587
Accumulated other comprehensive income (26,121) -
Deficit (27,962,750) (28,104,216)
  Total stockholders’ equity 24,299,344 23,921,237
Total liabilities and stockholders’ equity $ $ 110,232,013 $ $ 101,480,667



Tucows Inc. Tucows Inc.
Consolidated Statements of Operations Consolidated Statements of Operations
(Dollar amounts in U.S. dollars) (Dollar amounts in U.S. dollars)
Three months ended September 30, Nine months ended September 30,
2011 2010 2011 2010
(unaudited) (unaudited)
Net revenues $ 25,094,056 $ 21,209,468 $ 70,695,186 $ 62,501,219
Cost of revenues:
Cost of revenues (*) 17,658,648 14,903,525 49,578,724 42,871,489
Network expenses 1,193,669 1,087,930 3,691,995 3,500,826
Depreciation of property and equipment 159,191 231,253 608,961 794,368
Amortization of intangible assets 23,960 74,802 49,680 224,406
  Total cost of revenues 19,035,468 16,297,510 53,929,360 47,391,089
Gross profit 6,058,588 4,911,958 16,765,826 15,110,130
Sales and marketing (*) 1,867,085 1,830,999 5,663,759 5,480,228
Technical operations and development (*) 1,220,953 1,053,768 3,651,782 3,486,718
General and administrative (*) 1,279,082 633,457 3,509,395 2,049,813
Depreciation of property and equipment 48,874 40,239 140,556 127,559
Amortization of intangible assets 201,180 360,540 785,920 1,081,620
Loss (gain) on change in fair value of forward exchange contracts 2,152,243 (141,981) 2,458,104 1,669,031
  Total expenses 6,769,417 3,777,022 16,209,516 13,894,969
Income (loss) from operations (710,829) 1,134,936 556,310 1,215,161
Other income (expenses):
Interest (expense) income, net (18,718) (26,917) (38,915) (99,812)
Other income - - 374,977 -
  Total other income (expenses) (18,718) (26,917) 336,062 (99,812)
Income (loss) before provision for income taxes (729,547) 1,108,019 892,372 1,115,349
Provision for income taxes 422,592 24,863 750,906 235,105
Net income (loss) for the period $ (1,152,139) $ 1,083,156 $ 141,466 $ 880,244
Basic earnings (loss) per common share $ (0.02) $ 0.02 $ - $ 0.01
Shares used in computing basic earnings (loss) per common share 53,452,205 57,351,161 53,444,959 59,255,739
Diluted earnings (loss) per common share $ (0.02) $ 0.02 $ - $ 0.01
Shares used in computing diluted earnings (loss) per common share 53,452,205 59,185,793 55,748,777 61,223,369
(*) Stock-based compensation has been included in expenses as follows:
Network expenses $ 5,808 $ 6,557 $ 17,170 $ 15,759
Sales and marketing $ 22,695 $ 30,358 $ 67,155 $ 71,589
Technical operations and development $ 13,020 $ 19,058 $ 40,122 $ 51,903
General and administrative $ 79,364 $ 99,813 $ 124,170 $ 174,437



Tucows Inc. Tucows Inc.
Consolidated Statements of Cash Flows Consolidated Statements of Cash Flows
(Dollar amounts in U.S. dollars) (Dollar amounts in U.S. dollars)
Three months ended September 30, Nine months ended September 30,
2011 2010 2011 2010
(unaudited) (unaudited)
Cash provided by (used in):
Operating activities:
Net income (loss) for the period $ (1,152,139) $ 1,083,156 $ 141,466 $ 880,244
Items not involving cash:
  Depreciation of property and equipment 208,065 271,492 749,517 921,927
  Amortization of deferred financing charges 3,000 6,000 11,100 20,100
  Amortization of intangible assets 225,140 435,342 835,600 1,306,026
  Decrease in deferred tax liability (18,400) - (18,400) -
  Deferred rent 5,310 - 19,274 -
  Disposal of domain names 8,816 5,084 29,907 17,090
  Unrealized loss (gain) in the fair value of forward contracts 2,152,243 (141,981) 2,458,104 1,669,031
  Stock-based compensation 120,887 155,786 248,617 313,688
Changes in non-cash operating working capital:
  Accounts receivable 412,735 53,373 (715,829) (510,232)
  Prepaid expenses and deposits 264,660 489,843 (958,989) 61,356
  Prepaid fees for domain name registry and ancillary services fees (1,074,068) (2,355,886) (4,823,650) (5,786,558)
  Income taxes recoverable 173,008 (165,000) 333,008 127,000
  Accounts payable (531,095) (244,194) (327,272) (443,624)
  Accrued liabilities (113,972) (231,633) 267,595 (264,317)
  Customer deposits 170,762 240,907 (86,941) 78,147
  Deferred revenue 788,835 (14,435) 5,046,102 6,023,890
  Accreditation fees payable (15,607) 2,287,739 6,185 13,882
Net cash provided by operating activities 1,628,180 1,875,593 3,215,394 4,427,650
Financing activities:
Proceeds received on exercise of stock options 10,685 - 14,145 14,809
Repurchase of common stock - - - (6,914,792)
Proceeds received on loan payable 2,530,000 (478,561) 2,530,000 (1,435,682)
Repayment of loan payable (1,319,040) - (2,276,161) -
Net cash provided by (used in) financing activities 1,221,645 (478,561) 267,984 (8,335,665)
Investing activities:
Additions to property and equipment (138,909) (33,111) (629,935) (292,790)
Acquisition of EPAG Domainservices GMBH, net of cash acquired (2,392,461) - (2,392,461) -
Net cash used in investing activities (2,531,370) (33,111) (3,022,396) (292,790)
Foreign exchange loss on cash held in foreign currencies (12,946) - (12,946) -
Increase (decrease) in cash and cash equivalents 305,509 1,363,921 448,036 (4,200,805)
Cash and cash equivalents, beginning of period 4,348,256 4,067,668 4,205,729 9,632,394
Cash and cash equivalents, end of period $ 4,653,765 $ 5,431,589 $ 4,653,765 $ 5,431,589
Supplemental cash flow information:
Interest paid $ 18,890 $ 27,001 $ 39,197 $ 99,798
Supplementary disclosure of non-cash investing activity:
Property and equipment acquired during the period not yet paid for $ 124,979 $ 146,158 $ 124,979 $ 146,158