August 9, 2005 (Computerworld) --
It has been a challenging road for Network Solutions Inc., the one-time monopoly registrar of .com domain names that, when its market was deregulated, lost market share at a record-setting rate. Now, the Herndon, Va.-based company plans to evolve as a provider of online business services, and today, it announced a major push into the small-business market. Computerworld's Sharon Machlis spoke with Chairman and CEO Champ Mitchell about charging $35 for domain names when some competitors price at $8.95, how the Hushmail domain hijacking really happened and the importance of answering the phone. This is Part 1 of a two-part interview. How do you sustain a business where you're charging $35 a year for something that a lot of your competitors are charging maybe one-fifth the price for? We're a lot better. As you know, Network Solutions used to be the monopoly. Between a combination of abusing its customers and giving the poorest customer service on the face of the planet, they managed to gain a first: They lost market share faster than any former monopoly in the history of the United States. I will say that as one of their customers, I think it was well deserved. Obviously, there were lots of issues when I came here [in August 2001]. The customer-service aspect of the business was probably the worst part of all. The abandonment rate [for callers waiting to talk to a service representative] was 30%. And I was like, "I beg your pardon? What the devil is going on?" (Except I may not have used "devil.") They were very nonplussed by that; they said that was normal for them. But since their average wait time was an hour and 15 minutes, it was not a shock. Today, our abandonment rate is less than 1%, and our average wait time is about 15 seconds. We've stabilized. We've got about 7.5 million domains under management. But here's, I think, the key thing for us: We don't see ourselves as a domain-name company anymore. Our revenue mix reflects that we are moving away from being a domain-name company. In the last 18 months, we've gone from less than 10% of our revenue coming from something other than a domain name to over 30%. Is that Web hosting? It's a combination of online services for small businesses. That's the part of the business that's growing. I think it shocks people when I say we are the small-business experts online, because we have the largest customer base of small businesses of anybody online. ... The fastest-growing part of the marketplace online is small businesses. Right now, [there are about] 8 million small businesses
Q&A Part 1: Network Solutions CEO touts small-business push
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