Source: netv@lue, The Edge
Date: Monday, October 24, 2005
Qinetics new Qi

How many lives can a company have? REDtone, for example, started life as a hardware vendor. Even today, it is still evolving and is now making a move into the mobile payment space. Qinetics is a lesser known company than REDtone, but knows all about having to change and adapt.

A subsidiary of Bhd, Qinetics was born in 2000, near the tail-end of the dot-com boom. Its business at that time was as the sole agent in Asia for the .cc domain name, which belongs to the Cocos (Keeling) Islands, near Sumatra. Those were heady times and it even signed up Andy Lau as its celebrity business partner.

However, when the .cc business didn't take off as expected, in 2001, it had to re-invent itself. Since the .cc extension couldn't provide the volume it needed, it added more extensions. Today, it has about 20 extensions - the best-selling ones being .com and .net.

But even that was not enough as it was still mere resellers of other people's products.

Then, it started developing software that was needed by web hosting companies such as server virtualization software. By developing more such software, it managed to position itself as a one-stop shop for Internet hosting providers, says TK Tan, the chief executive officer.

"We're a facilitator for Internet hosting companies to get them up and run quickly. That's our value proposition. We sell the soft infrastructure web hosting companies need to automate their hosting business". Today, the company employs over 30 staff and had over RM10million in revenue in 2004.

While the majority of the revenue still comes from its wholesale registrar business via 750 resellers and most of its software in the past is customized software, it has taken a big step forward with the soft launch of its first shrink wrapped product - the RegistryASP suite in July 2004.

Even then it has been a long and hard slog to gain that first customer, but on Oct 3, 2005 its RegistryASP suite found its first customer - Hong Kong Domain Name Registration Limited (HKDNR). HKDNR manages all domain names under the .hk domain - that is, any web address that ends with .hk, such as, and

Qinetics is, as far as it knows, the only maker of domain name registry-registrar software in Asia, and one of fewer than 10 in the world. As part of the deal, Qinetics will customize the RegistryASP suite to HKDNR requirements and integrate it with existing legacy systems.

The benefits that HKDNR will get from implementing the system will include being able to offer its channel partners self-service functions, that is, partners will be able to register and modify domain names directly on the database through the new system. By automating the process, HKDNR will be able to ramp up volume of registrations while maintaining high standards of service and reliability.

Qinetics' solution will also enable HKDNR to register domain names in Chinese characters. Apart from HKDNR, Qinetics is also exploring other potential buyers in the region.
That Qinetics makes and sells software to other registrars puts it in the unique position of selling software to its competitors as the majority of Qinetics' revenue actually comes from its domain name registration business via its registrar service under the WebNIC brand.

"We see that as a benefit to us," says Tan, "as we get to improve our RegistryASP suite of products when customers give us feedback." Mimos, which manages Malaysia's .my domain name, has bought a few software components from Qinetics to bolt on top of its existing in-house applications.

Tan says the deciding factor in winning the deal is how hungry a company is to get it. "We were more willing to cater to HKDNR's demands than the other companies." He turned coy when asked to reveal how much the deal was worth, but added that Qinetics is proud to answer the government's call to export technology.

Apart from the landmark deal with HKDNR, Qinetics has also jumped in the rankings of domain name registrars. WebNIC is now ranked 52nd out of 478 ICANN accredited domain name registrars in the world (ICANN, the Internet Corporation for Assigned Names and Numbers, is the international body responsible for Internet address space allocation). It has a 0.24% global market share and has registered 131,975,000 domain names.

Market leader, US based Go Daddy, has a 14.78% share or 8,067,723 registrations. In 2003, WebNIC was ranked in the hundreds. In a list dominated by American companies (all the top registrars are from the US), Qinetics is now the seventh largest Asian registrar. Directi from India at number 20 is the largest Asian registrar with a 0.927% market share. In September, WebNIC was the third fastest growing Asian registrar, behind Directi and Xinnet.

What advice has he for other Malaysian entrepreneurs looking to expand abroad? Tan advises them to think big but act a step at a time. "From the first day, we knew the Malaysian market was too small so we designed the company to go regional from day one," he says, "but we ran into some problems where our capacity to deliver couldn't catch up with the number of deals we made overseas. So, companies should make sure their back-end can cope with demand."

Like almost every Malaysian company, Qinetics battled image problems abroad. "Malaysia is not well branded. Even to win this HKDNR deal, we had a tough time changing their mindset." But he advises others not to give up. "It takes perseverance and years. Branding will come naturally when you consistently provide good service."