Enom 2010 Annual Report Download - page 73

Table of Contents
publishers adopting our social media applications. RPMs decreased 15% from $4.04 in the year ended December 31, 2008 to $3.45 in the year
ended December 31, 2009. The decrease in RPMs was largely due to overall declines in advertising yields from our advertising providers relating
to our customers' undeveloped websites.
Registrar Revenue
2010 compared to 2009. Registrar revenue for the year ended December 31, 2010 increased $9.3 million or 10%, to $100.0 million compared to
$90.7 million for the same period in 2009. The increase was largely due to an increase in domains, due in large part to an increased number of
new domain registration and domain renewal registrations in 2010 compared to 2009 partially offset by a slight decrease in our average revenue
per domain. The number of domain registrations increased 1.9 million or 21% to 11.0 million during the year ended December 31, 2010 as
compared to 9.1 million. Our average revenue per domain decreased slightly by $0.15 or 1% to $9.96 during the year ended December 31, 2010
from $10.11 in the same period in 2009 largely due to a higher mix of volume-based domain resellers transferring over their domain registrations
in the latter half of 2010 as compared to 2009.
2009 compared to 2008. Registrar revenue for the year ended December 31, 2009 increased $5.3 million or 6%, to $90.7 million compared to
$85.4 million for the same period in 2008. The increase was largely due to an increase in domains, due in large part to an increased number of
domain renewal registrations in 2009 compared to 2008, coupled with a slight increase in our average revenue per domain. The number of
domain registrations increased 0.3 million or 3% to 9.1 million during the year ended December 31, 2009 as compared to 0.3 million or 4% to
8.8 million during the same period in 2008. Our average revenue per domain increased slightly by $0.26 or 3% to $10.11 during the year ended
December 31, 2009 from $9.85 in the same period in 2008 largely due to price increases effected by our registry partners and increased sales of
value-added services.
Cost and Expenses
Operating costs and expenses were as follows:
% Change
Year ended December 31,
(2008
to
2009)
(2009
to
2010)
2008 2009 2010
(in thousands)
Service costs (exclusive of amortization of intangible assets) $ 98,184 $ 114,536 $ 131,332 17% 15%
Sales and marketing 15,310 20,044 24,424 31% 22%
Product development 14,252 21,657 26,538 52% 23%
General and administrative 28,070 28,479 37,371 1% 31%
Amortization of intangible assets 33,204 32,152 33,750 (3)% 5%
Service Costs
2010 compared to 2009. Service costs for the year ended December 31, 2010 increased by approximately $16.8 million or 15% to
$131.3 million compared to $114.5 million in the same period in 2009. The increase was largely due to a $7.4 million increase in domain registry
fees associated with our growth in domain registrations and related revenue over the same period, a $1.6 million increase in TAC due to an
increase in undeveloped website customers and related revenue over the same period, a $1.4 million increase in direct costs associated with
operating our network, a $2.9 million increase in depreciation expense of technology assets purchased in
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