8 ms·

The time of .org as 'trusted' is over. When a private equity investment firm buys something, they plan to extract value, they don't create value. Ethos Capita

The time of .org as 'trusted' is over. When a private equity investment firm buys something, they plan to extract value, they don't create value. Ethos Capital was formed in 2019 [1]. Price caps were lifted before it was sold [2]. Combined with the billion plus valuation, something is sketchy. Even if you trust this sale, they could even resell it to a less trustworthy owner after increasing rates making a return on investment, that is probably the plan. .orgs will be filled with extortion to good .orgs, and fake .orgs will be created which will create distrust about existing .orgs, and allow propaganda to spread. There will be tons of malware and phishing going on when people think they are on trustable domains. If they could buy .gov they would. Just more of the turn of the internet to authoritarian/corporate control over the internet's anti-authoritarian/public/independent roots. [1] https://en.wikipedia.org/wiki/Ethos_Capital https://en.wikipedia.org/wiki/Ethos_Capital [2] https://arstechnica.com/tech-policy/2019/11/private-equity-firm-buys-org-domain-months-after-icann-lifted-price-caps/ https://arstechnica.com/tech-policy/2019/11/private-equity-f...

ddingus 7y ago
I am going to let my .org return to the pool. I will miss having it, but I feel this move is adding zero value. Money grab, violation of net basics. We are moving to a new, worse time. Have been for a while. I do not want to reward that investment at all.
- Aperocky 7y ago
  Maybe with the abundance of TLDs .com/.org will eventually be reduced in importance and seen just as another TLD with a bit of special history.
  - thaumasiotes 7y ago
    As things stand now, .com is basically seen as just a mysterious string that ends URLs in much the same way that "http" begins URLs. It isn't viewed as having any more significance than that. "Just another TLD" is arguably a step up in importance from "invisible part of the background that nobody ever thinks about".
    - bscphil 7y ago
      > .com is basically seen as just a mysterious string that ends URLs in much the same way that "http" begins URLs. This is 100% true. And yet, for the average person, it's viewed as the default mysterious string that ends a website's "name". Anything else is viewed as slightly questionable, although most people are aware of .org and .net as sometimes legitimate exceptions. I think most people would be less likely to enter their credit card information on a ".biz" domain, even though they couldn't express any accurate reason why that made it less trustworthy. That's significant, even if it makes no technological difference.
      - eloisant 7y ago
        Outside US, country tld are also very common.
        TeMPOraL 7y ago
        The same heuristics apply. .<ccTLD> is roughly as trustworthy as .com is; .<class>.<ccTLD> is as trustworthy as .<tld>, where class=tld.
      - bjornjaja 7y ago
        I think the move to more specific domains is better and .org should be a relic of the past. For instance, consider: people.org people.health people.art The last two actually imply what they are about, but the .org could be anything. Trust and faith in the service associated with a domain needs to be built with standard channels like word of mouth, advertising, good business practices, etc.
        Nullabillity 7y ago
        To me an industry-specific TLD just says "We couldn't think of an original name."
        bjornjaja 7y ago
  - ddingus 7y ago
    I don't care about that happening with .com I do care about that happening with .org The .org matters. I would say these new owners don't get that, but I think they do, and think they have position to just rent seek, essentially trading on something that matters to just about the point where it doesn't so much. Not going there. End game is .org no longer matters. Fine. Might as well not contribute to the whole mess.
    - nicky0 7y ago
      Rather than pre-emptively throwing your toys out of the pram, why not wait and see whether Ethos proves to abuse their position or not.
      - ddingus 7y ago
        Just watch: "If we double it, the impact to any one domain will be near negligible..." That will prove irresistible. Too easy. And unnecessary. Flat out, someone got pitched about an easy money machine, with strong second sale potential. And it is, and will be too. It is because .org was not supposed to be about these kinds of things. Well, now it is. With no value added. Just rent seeking. Maybe in the future much stronger legal means can prevent this kind of thing from happening. I get it. The money is good. It just will not come from me. Have seen this movie enough times to know how it ends now. It is sad, and it sucks.
      - drawkbox 7y ago
        Ethos Capital (little bit too much like 'tethics') was formed in 2019 so nobody knows. Their headquarters is in Mauritius [1][2]. They could even be cool for a bit and then sell it to someone worse, though it isn't looking good as there was some insider finagling [3]. The problem is '.org' is in the private equity game now and when you go down that path, value is extracted and entities end up stripped of assets, loaded with debt and eventually stagnate. Private equity investment does not invest for community goodwill, it is a value extraction mission. Even if it is for investment, as much value or growth that can be extracted before it is available for investment is the modus operandi see Softbank with WeWork, Uber etc. You can see Ethos Capital goals and history where again creating returns and value extraction is the only goal. [4][5] Since it is a new entity there is very little ability to predict what this firm does or will do with their investment targets. If this is the new game in TLDs then there could be some price collusion incoming, meaning more expensive for small/medium/institutions that are trying to compete or do public good. [1] https://en.wikipedia.org/wiki/Mauritius https://en.wikipedia.org/wiki/Mauritius [2] https://ethoscapital.mu/contact/contact-us/ https://ethoscapital.mu/contact/contact-us/ [3] https://www.theregister.co.uk/2019/11/20/org_registry_sale_shambles/ https://www.theregister.co.uk/2019/11/20/org_registry_sale_s... [4] https://ethoscapital.mu/what-we-do/advisor-ethos-private-equity/ https://ethoscapital.mu/what-we-do/advisor-ethos-private-equ... [5] https://ethoscapital.mu/what-we-do/investment-strategy/ https://ethoscapital.mu/what-we-do/investment-strategy/
hamhand 7y ago
I've seen plenty of scam and piracy sites using it in recent year, don't know if it's China-specific.
- mirekrusin 7y ago
  Can you sue Ethos Capital for scam .org now?
WillPostForFood 7y ago
fake .orgs will be created which will create distrust about existing .orgs, and allow propaganda to spread Why? It isn't in their own interest to ruin .org.
- Aperocky 7y ago
  It depends on the economic benefit they can extract and get away with.
  - WillPostForFood 7y ago
    You can extract more value by squeezing the people who need it than by devaluing it by selling .org domains to scammers and phishers.
    - intended 7y ago
      You do both. As you squeeze it stops being viable for legitimate players. Then the scammers dominate.
    - sojmq 7y ago
      You can register a .org domain no matter what purpose you give to it. Scammers and phishers have always been able to buy .org domains.
    - TeMPOraL 7y ago
      Long-term? Yes. Short-term? Not necessarily. And it's a rare market entity that prefers long-term value over short-term gains.
- bborud 7y ago
  You are assuming that we know what "ruining .org" means for everyone. We don't. From an investor's perspective "ruining .org" means the asset won't produce return on investment. From your or my perspective it may be something entirely different.
- kadoban 7y ago
rgbrenner 7y ago
.org is an unrestricted gtld... You don't have to be a non-profit to register a .org.. you just need $10. So I don't know what trust you're referring to. If you've been putting any trust into a website because it's a .org, that was your mistake... It's been unrestricted for a very long time. Ethos changes nothing in that regard.
- deleted 7y ago
  [deleted]
- ekianjo 7y ago
  Agree. As an owner of a few .orgs I confirm there is no such restriction.
- jerry1979 7y ago
  I trusted that some committee somewhere was trying to make an honest go of it with this Internet thing [1]. With the selling of ORG, I lost some trust in the administration of the domain name system. Most people already knew anyone could register a .org domain. That really wasn't the point. [1] https://tools.ietf.org/html/rfc920 https://tools.ietf.org/html/rfc920
  - VectorLock 7y ago
    That RFC hasn't been in effect, unfortunately, since the Internet became mainstream.
  - psds2 7y ago
    That RFC never went into effect. Perhaps it is a good thing that the illusion of .org trust has been shattered for many.
    - williamdclt 7y ago
      I don't think I know anybody non-technical (and not that many technical people either) that has any idea what these ".com", ".net", ".org" things are or that they can mean different things. Most people don't even know that there was an illusion that's supposed to be shattered
ReptileMan 7y ago
You are aware this is the situation today trustwise? Nothing new.
formercoder 7y ago
Value is created by private equity buyouts through operational improvements.
- harry8 7y ago
  Have you seen my bridge? It's actually for sale! It's crying out for your operational improvements to really get it monetized...
- tobltobs 7y ago
  That is a very naive view of private equity buyouts. The domain business of .org is run by Afilias, they pay about $2 per year for a domain. That is a extremely low price and it would be very difficult to manage to get a lower price anywhere. In fact Afilias might not be motivated to continue with such a generous price if they are a for profit registry now. In reality value is created by private equity buyouts through an aggressive use of debt, which provides financing and tax advantages and freedom from restrictive regulations.
- dreamcompiler 7y ago
  Please cite a case where this has actually happened.
  - formercoder 7y ago
    Most of the information is not public, there are a number of HBS cases with relevant data but they are all behind paywalls. If you do the math, it's clear that ebitda margin improvement, top line growth, and multiple expansion have a much larger impact on returns than debt paydown. Here are some highly quick and dirty numbers (initial equity value is negative bc it's plugged straight into IRR()): https://imgur.com/lGCs5aR https://imgur.com/lGCs5aR
- balt_s 7y ago
  You are clever like a fox.
vintermann 7y ago
So how long until I need to pay a Shkreli-ton to keep my mail address?

ddingus 7y ago

I am going to let my .org return to the pool. I will miss having it, but I feel this move is adding zero value. Money grab, violation of net basics. We are moving to a new, worse time. Have been for a while. I do not want to reward that investment at all.

Aperocky 7y ago
Maybe with the abundance of TLDs .com/.org will eventually be reduced in importance and seen just as another TLD with a bit of special history.
- thaumasiotes 7y ago
  As things stand now, .com is basically seen as just a mysterious string that ends URLs in much the same way that "http" begins URLs. It isn't viewed as having any more significance than that. "Just another TLD" is arguably a step up in importance from "invisible part of the background that nobody ever thinks about".
  - bscphil 7y ago
    > .com is basically seen as just a mysterious string that ends URLs in much the same way that "http" begins URLs. This is 100% true. And yet, for the average person, it's viewed as the default mysterious string that ends a website's "name". Anything else is viewed as slightly questionable, although most people are aware of .org and .net as sometimes legitimate exceptions. I think most people would be less likely to enter their credit card information on a ".biz" domain, even though they couldn't express any accurate reason why that made it less trustworthy. That's significant, even if it makes no technological difference.
    - eloisant 7y ago
      Outside US, country tld are also very common.
      - TeMPOraL 7y ago
        The same heuristics apply. .<ccTLD> is roughly as trustworthy as .com is; .<class>.<ccTLD> is as trustworthy as .<tld>, where class=tld.
    - bjornjaja 7y ago
      I think the move to more specific domains is better and .org should be a relic of the past. For instance, consider: people.org people.health people.art The last two actually imply what they are about, but the .org could be anything. Trust and faith in the service associated with a domain needs to be built with standard channels like word of mouth, advertising, good business practices, etc.
      - Nullabillity 7y ago
        To me an industry-specific TLD just says "We couldn't think of an original name."
        bjornjaja 7y ago
- ddingus 7y ago
  I don't care about that happening with .com I do care about that happening with .org The .org matters. I would say these new owners don't get that, but I think they do, and think they have position to just rent seek, essentially trading on something that matters to just about the point where it doesn't so much. Not going there. End game is .org no longer matters. Fine. Might as well not contribute to the whole mess.
  - nicky0 7y ago
    Rather than pre-emptively throwing your toys out of the pram, why not wait and see whether Ethos proves to abuse their position or not.
    - ddingus 7y ago
      Just watch: "If we double it, the impact to any one domain will be near negligible..." That will prove irresistible. Too easy. And unnecessary. Flat out, someone got pitched about an easy money machine, with strong second sale potential. And it is, and will be too. It is because .org was not supposed to be about these kinds of things. Well, now it is. With no value added. Just rent seeking. Maybe in the future much stronger legal means can prevent this kind of thing from happening. I get it. The money is good. It just will not come from me. Have seen this movie enough times to know how it ends now. It is sad, and it sucks.
    - drawkbox 7y ago
      Ethos Capital (little bit too much like 'tethics') was formed in 2019 so nobody knows. Their headquarters is in Mauritius [1][2]. They could even be cool for a bit and then sell it to someone worse, though it isn't looking good as there was some insider finagling [3]. The problem is '.org' is in the private equity game now and when you go down that path, value is extracted and entities end up stripped of assets, loaded with debt and eventually stagnate. Private equity investment does not invest for community goodwill, it is a value extraction mission. Even if it is for investment, as much value or growth that can be extracted before it is available for investment is the modus operandi see Softbank with WeWork, Uber etc. You can see Ethos Capital goals and history where again creating returns and value extraction is the only goal. [4][5] Since it is a new entity there is very little ability to predict what this firm does or will do with their investment targets. If this is the new game in TLDs then there could be some price collusion incoming, meaning more expensive for small/medium/institutions that are trying to compete or do public good. [1] https://en.wikipedia.org/wiki/Mauritius https://en.wikipedia.org/wiki/Mauritius [2] https://ethoscapital.mu/contact/contact-us/ https://ethoscapital.mu/contact/contact-us/ [3] https://www.theregister.co.uk/2019/11/20/org_registry_sale_shambles/ https://www.theregister.co.uk/2019/11/20/org_registry_sale_s... [4] https://ethoscapital.mu/what-we-do/advisor-ethos-private-equity/ https://ethoscapital.mu/what-we-do/advisor-ethos-private-equ... [5] https://ethoscapital.mu/what-we-do/investment-strategy/ https://ethoscapital.mu/what-we-do/investment-strategy/

hamhand 7y ago

I've seen plenty of scam and piracy sites using it in recent year, don't know if it's China-specific.

mirekrusin 7y ago
Can you sue Ethos Capital for scam .org now?

WillPostForFood 7y ago

fake .orgs will be created which will create distrust about existing .orgs, and allow propaganda to spread Why? It isn't in their own interest to ruin .org.

Aperocky 7y ago
It depends on the economic benefit they can extract and get away with.
- WillPostForFood 7y ago
  You can extract more value by squeezing the people who need it than by devaluing it by selling .org domains to scammers and phishers.
  - intended 7y ago
    You do both. As you squeeze it stops being viable for legitimate players. Then the scammers dominate.
  - sojmq 7y ago
    You can register a .org domain no matter what purpose you give to it. Scammers and phishers have always been able to buy .org domains.
  - TeMPOraL 7y ago
    Long-term? Yes. Short-term? Not necessarily. And it's a rare market entity that prefers long-term value over short-term gains.
bborud 7y ago
You are assuming that we know what "ruining .org" means for everyone. We don't. From an investor's perspective "ruining .org" means the asset won't produce return on investment. From your or my perspective it may be something entirely different.
kadoban 7y ago

rgbrenner 7y ago

.org is an unrestricted gtld... You don't have to be a non-profit to register a .org.. you just need $10. So I don't know what trust you're referring to. If you've been putting any trust into a website because it's a .org, that was your mistake... It's been unrestricted for a very long time. Ethos changes nothing in that regard.

deleted 7y ago
[deleted]
ekianjo 7y ago
Agree. As an owner of a few .orgs I confirm there is no such restriction.
jerry1979 7y ago
I trusted that some committee somewhere was trying to make an honest go of it with this Internet thing [1]. With the selling of ORG, I lost some trust in the administration of the domain name system. Most people already knew anyone could register a .org domain. That really wasn't the point. [1] https://tools.ietf.org/html/rfc920 https://tools.ietf.org/html/rfc920
- VectorLock 7y ago
  That RFC hasn't been in effect, unfortunately, since the Internet became mainstream.
- psds2 7y ago
  That RFC never went into effect. Perhaps it is a good thing that the illusion of .org trust has been shattered for many.
  - williamdclt 7y ago
    I don't think I know anybody non-technical (and not that many technical people either) that has any idea what these ".com", ".net", ".org" things are or that they can mean different things. Most people don't even know that there was an illusion that's supposed to be shattered

ReptileMan 7y ago

You are aware this is the situation today trustwise? Nothing new.

formercoder 7y ago

Value is created by private equity buyouts through operational improvements.

harry8 7y ago
Have you seen my bridge? It's actually for sale! It's crying out for your operational improvements to really get it monetized...
tobltobs 7y ago
That is a very naive view of private equity buyouts. The domain business of .org is run by Afilias, they pay about $2 per year for a domain. That is a extremely low price and it would be very difficult to manage to get a lower price anywhere. In fact Afilias might not be motivated to continue with such a generous price if they are a for profit registry now. In reality value is created by private equity buyouts through an aggressive use of debt, which provides financing and tax advantages and freedom from restrictive regulations.
dreamcompiler 7y ago
Please cite a case where this has actually happened.
- formercoder 7y ago
  Most of the information is not public, there are a number of HBS cases with relevant data but they are all behind paywalls. If you do the math, it's clear that ebitda margin improvement, top line growth, and multiple expansion have a much larger impact on returns than debt paydown. Here are some highly quick and dirty numbers (initial equity value is negative bc it's plugged straight into IRR()): https://imgur.com/lGCs5aR https://imgur.com/lGCs5aR
balt_s 7y ago
You are clever like a fox.

vintermann 7y ago

So how long until I need to pay a Shkreli-ton to keep my mail address?