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About Antone JohnsonStartup lawyer, advisor, executive, board member, commentator immersed in social Web and mobile tech entrepreneurship. Founding Principal of Bottom Line Law Group: http://bottomlinelawgroup.com . Blog at Gust - http://www.gust.com/angel-investing/startup-blogs/author/antonejohnson/ and Mashtag: http://masht.ag . Tweet as http://twitter.com/antonejohnson . Palo Alto native, based in San Francisco and Santa Monica, CA. |
Re: Re: What about existing patent law?
Re:
Stack THIS, madam spokeswoman
What about the 30,000+ "American jobs" created by the hated Google alone, and $200 billion market value created and poured into "our economy" by Google alone, in just the past decade or so?
These guys deserve all the profanity that Mike was classy enough not to sprinkle liberally throughout the article. Having read about the outrageously stacked legislative process that the bill has been through so far, reading this had me bursting a few blood vessels as well. Mike, hats off to you for calling it as you see it.
Fundamental misunderstanding of the economics
1. In the absence of a boycott, GD might have 75K domains transfer in and 5K out on an ordinary day. (Arbitrary numbers made up to illustrate my point.) The real pain inflicted is the marginal decrease (if any) in net inflows of domain registrations vs. what it would have been without a boycott.
2. GoDaddy has been targeting domain owners with aggressive promotions to retain them as customers or win back people who already initiated transfers. (I am one of those people who received an offer by email.) To the extent customers accept those offers, by definition it entails slashing GD's profit margin on those customers, at least in the short term.
3. These numbers don't reflect domains for which the owners (a) turn off auto-renewal, planning to transfer before they expire; (b) decide to renew for a shorter period than they otherwise would have; or (c) decline to buy extra services like private registration, hosting, email, etc. and instead get them from another provider. Again, reducing LTV.
4. These numbers completely ignore customer acquisition cost. GD's online marketing team may well have gone on red alert and started spending money hand-over-fist to drive much higher traffic than normal in order to offset the damage.
The basic financial equation for any subscription/recurring revenue business is:
Look, GD has been freaking out and made two rapid, embarrassing shifts in its stance on an important public policy issue. They know their own business better than we do. If they're seriously worried about the impact � which by all indications appears to be the case � it's for a reason.
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