Dan founder, Reza Sardeha, emerged via Twitter and delivered his personal opinion about the recent drastic fee changes at GoDaddy.
The back story: Just months after acquiring Dan.com in June 2022 for a reported $71 million dollars in cash, GoDaddy increased the fees domain investors pay to use the Dan platform.
Starting on February 1st, Dan.com fees go to 15% from 9%, all while other GoDaddy-operated platforms move to the same 15% rate. The real kicker: a massive 25% “head tax” when not using the Godaddy-approved DNS.
Back to Reza, whose personal involvement in making Dan.com a successful company cannot be overstated. Tweeting from a cleaned up Twitter account—Reza deletes his entire Twitter feed regularly—the Dan.com founder and strategic advisor to GoDaddy stated the following:
My (personal) view on the recent Dan & Godaddy commission alignment:
1: 55-60% of domain sales originate at the biggest and most effective distribution network (Afternic). The commission there is decreased from 20% to 15%.
2: 45%-40% via optimized for sale pages and the commission from direct lander sales will be aligned with what you pay for a distributed sale.
Effectively, the average domainer will not see a net negative on his/her sales outcome but in some cases even a positive outcome after this commission alignment.
Historically domainers react negatively to paying a commission but I’ve always said that a commission-less domain industry would lead to zero innovation as operating in the field without income results in no R&D and so product development or simply poor service.
To conclude: the roadmap of Dan & Godaddy for the secondary market is huge and exciting and is delivering tremendous value for all domainers that utilize these services effectively.
Nobody likes change but great things are on the horizon.
While it’s positive to see a statement from Reza for a project he no longer controls, we have to note that these statements simply align with the GoDaddy press releases sent out for Dan.com, Afternic, and Uni Market. In other words, Mr. Sardeha acts as a megaphone of GoDaddy.
There are many questions that follow these statements which need to be addressed, so here are a few:
- Why no mentioning of the outrageous “head tax” of 25% in fees when not using GoDaddy-sponsored DNS?
- How is this innovative given the price-jacking GoDaddy is causing to the users of platforms it acquired?
- Who exactly is the “average domainer” that would benefit from the loss of tiered fee structure at Afternic?
- Many ccTLDs aren’t supported by Afternic, punishing users of the Dan platform with a 6% increase in fees. How is this fair?
Surely these aren’t “commission-less” platforms as Mr. Sardeha proclaims; the fee increase is merely a price-jacking of existing rates, with an added 25% “head tax” that serves as an outrageous punishment of domain investors that want to have a choice on who will be digging through their traffic.
It’s really a shame seeing how far Dan.com has fallen.
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25% is not a commission, it is a steal !
“commission-less domain industry would lead to zero innovation” totally BUllS (BS)- if there are no competitors, there is no incentive for you to innovate.
If there are no good competitors in the field and you are the only one, then you are the sore loser.
Why bother attending the domain conference when there is only one sponsor and you are being brainwashed by them.
DAN and GD are good network, no doubts.. but 25% is not explainable. I personally like DaaZ.com , they are only charging small fees and also the service quality is good
Godaddy is very strategic, predictably so. It should be expected to get the most out of its acquisition of Dan.com.
So, no surprise that Godaddy “incentivizes” domain investors to use Afternic/Godaddy-owned nameservers with lower commission rates, or rates that are lower than a high 25% rate, and prioritize investors’ web traffic over Sedo & other aftermarket platforms.
But you will rarely see any domain media examination into Godaddy and how it might use a similar carrot and stick approach with registrars with regard to expired auction and aftermarket inventory.
One can think through ways Godaddy might similarly “incentivize” domain registrars to 1) participate in the lucrative (for Godaddy) expired auction platform and 2) carrying Afternic aftermarket inventory on their distribution network (and prioritizing Afternic/GD over Sedo & other platforms).
The danger with one large company being aggressively “strategic” and offering such incentives/tie-ins in an industry with little competition is that it some of those strategies can start to become anticompetitive.
DAN offers just lander. Not sure why anyone to pay to a huge price for a lander. S.H , DAAZ , Namecheap .. other marketplaces are offering decent pricing . People can cry and try to influence GD / Afternic / DAN / Uni network but the hard reality is they dont have a choice as EPIK is proven bad player and then DAN got acquired. Also GD has paid a huge price to acquire DAN.com , from business stand point of view what GD is doing not bad either.. they need to recover that 72 million. Reza is another corporate CEO trying to fool the people , domainers are so dumb to listen to his opinion also , because he sold himself to GD.
S.H , DAAZ , Efty.. etc will get some market share, but GD cant be avoided by anyone. Better to stop crying on this part.
The increase in fees in ridiculous, but I won’t be removing my domains from Dan.com or GD. I have simply increased all my prices there with 10 to 15% and kept the old prices on other platforms.
@PeterCheng
I removed over 500 Domains from Dan and GoDaddy auctions
I agree with most of what you said but I actually don’t mind a 15% commission, it is a fairly standard sum as far as commissions go. It is the 10% additional surtax taking it to 25% that is highway robbery and it basically makes it look like there ar no more domainers. Forcing us to use godaddy servers makes it look like the world is owned by godaddy. Have you seen their new landers. It’s all godaddy, contact us, our phone number etc etc. To an end user there is no more indication of private domain owners.
I cannot and will not ever support the forced nameservers and my domains now all lead to our new Canadian marketplace at dn.ca. In a small way I am helping by making free landers on our forum with free marketpages. I encourage other forums to do the same, with a few changes we can offer free landers to domainers. Look at our Market Pages at DN.ca as an example, it is a directory page with a custom user url linking to all other listings in the users market place.
Together we can force a reversal of this insane nameserver policy, remove your domains, add your voice!!
Seems to me that enough domainers yelling as they leave GoDaddy and Dan is about the only form of utility in addressing this RAPACIOUS change. We’re now in process of removing over 1,100 domains today from GoDaddy, brother-in-law slowly arriving at similar decision. Looking forward to encouraging every domainer to leave GoDaddy.
Apparently GoDaddy is making lots of domainers Go Diddy
Don’t forget you have to pay the taxes and other processing fees so it is like 40%
You are screwed big time
Yea yea they hired James Iles and Michael and they are supposed to support us the domainers but apparently all they care now is their own big fat salaries and benefits—TurnCoats!