Tucows 2015 Annual Report Download - page 71

Domain Services
Year ended December 31,
2015 2014 2013
(in ‘000’s)
Total new, renewed and transferred-in domain name
registrations provisioned 9,133 9,110 9,076
Domain names under management
Registered using the Tucows Registrar Accreditation 10,173 10,200 10,630
Registered using our Resellers’ Registrar
Accreditations 3,163 3,329 3,564
Total domain names under management 13,336 13,529 14,194
(1) For a discussion of these period to period changes in the domains provisioned and domains under
management and how they impacted our financial results see the Net revenue discussion below.
OPPORTUNITIES, CHALLENGES AND RISKS
As a MVNO our Ting service is reliant on our Mobile Network Operators ("MNOs") providing competitive
networks. Our MNOs each continue to invest in network expansion and modernization to improve their competitive
positions. Deployment of new and sophisticated technology on a very large scale entails risks. Should they fail to
implement, maintain and expand their network capacity and coverage, adapt to future changes in technologies and
continued access to and deployment of adequate spectrum successfully, our ability to provide wireless services to our
subscribers, to retain and attract subscribers and to maintain and grow our subscriber revenues could be adversely affected,
which would negatively impact our operating margins.
Ting has also enjoyed rapid growth in its first four years of operation. During this growth phase we have been
able to continue to grow gross customer additions and maintain a consistent churn rate, which has allowed us to maintain
net new customer additions despite the impact of churn on a fast growing customer base. We expect price competition to
grow more intense in the industry which could result in increased customer churn or reductions of customer acquisition
rates either of which could result in slower growth rates or in certain cases, our ability to maintain growth.
The communications industry continues to compete on the basis of network reach and performance, types of
services and devices offered, and price.
The increased competition in the market for Internet services in recent years, which we expect will continue to
intensify in the short and long term, poses a material risk for us. As new registrars are introduced, existing competitors
expand service offerings and competitors offer price discounts to gain market share, we face pricing pressure, which can
adversely impact our revenues and profitability. To address these risks, we have focused on leveraging the scalability of
our infrastructure and our ability to provide proactive and attentive customer service to aggressively compete to attract new
customers and to maintain existing customers.
Substantially all of our Domain Services revenue is derived from domain name registrations and related value-
added services from wholesale and retail customers using our provisioning and management platforms. The market for
wholesale registrar services is both price sensitive and competitive and is evolving with the introduction of New gTLDs,
particularly for large volume customers, such as large web hosting companies and owners of large portfolios of domain
names. We have a relatively limited ability to increase the pricing of domain name registrations without negatively
impacting our ability to maintain or grow our customer base. Growth in our Domain Services revenue is dependent upon
our ability to continue to attract and retain customers by maintaining consistent domain name registration and value-added
service renewal rates and to grow our customer relationships through refining, evolving and improving our provisioning
platforms and customer service for both resellers and end-users. In addition, we also generate revenue through pay-per-
click advertising and the sale of names from our portfolio of domain names and through the OpenSRS Domain Expiry
(1)
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