Please note that Verisign has a profit margin of 50%. Ie, 50% of their revenue becomes pure profit.
This is an insane level. Apple is at 23%. Facebook at 35%. Profit margins that high only come from rent seeking backed by the full force of the law.
This is an insane level. Apple is at 23%. Facebook at 35%. Profit margins that high only come from rent seeking backed by the full force of the law.
As a small structure you can achieve that but at a very large scale, this is effectively the sign that natural competition is not working as expected.
With all due cynicism, has their been public research on the sort of clever accounting tricks a company with Elsevier's business model must surely be using to keep their profit margin as low as 35% ..?
Me too. Their investor relations report [0] is the best source I know of, but it's pretty vague. I only see breakdowns of revenue, no details regarding operating costs.
PLOS One is transparent regarding their costs though [1]:
- 46% publishing, editorial
- 18% publishing, production
- 15% publishing, technology
- 16% general & admin
- 5% publication fee rebates
[0] https://www.relx.com/~/media/Files/R/RELX-Group/documents/re...
The Registrars like Namecheap and friends are just the messengers authorized to register .com domains into this larger database and they pay Verisign for the privilege to do so.
While it's possible for anyone to go out and stand up their own .COM zone in DNS, any domains created by that registrar don't actually exist in the eyes of the larger Internet and will not work.
https://insight.factset.com/sp-500-reporting-net-profit-marg...
It seems like an arbitrary metric to use. I would think focusing on barriers to entry, economies of scale, and legislative barriers to be more relevant factors in determining whether or not a profit margin is "acceptable".
I don't see that for Verisign, they're just rent seeking off domain. Their profit should probably be capped AT&T style back in their monopoly days with heavy regulation.