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					                                                                                                  Instructions




Internationalized Domain Names (IDN) Return on Investment (ROI) Model
  This spreadsheet allows you to calculate the approximate economics for sales of Internationalized Domain Name (IDN) registrations. Actual results
  may vary and will depend upon many factors including similarity between your forecasted data and your actual data. This model may not be suitable
  for all registrars or situations, and return on investment is not guaranteed.

  Follow the instructions below. You may wish to print the instruction to make using the model easier. The instructions are also on each sheet as
  "comments" (noted with a red mark in the upper right corner of the cell). To view the comment, place your cursor on the cell and the comment will
  appear.

  Only enter your assumptions in the boxes marked in    YELLOW.
  This model has data in some of the assumption boxes; this data is for demonstration purposes only. You will want to change the assumptions to suit
  your situation.

  There are three sheets that contain assumptions in this model:
       1. Revenue Assumptions
       2. Expense Assumptions
       3. Capital Expense (Capex) Assumptions

  The "Results" tab contains an income Statement, a Payback Analysis and a Breakeven Analysis based on the assumptions made on the previous
  three sheets.


Detailed Instructions:
Revenue Assumptions Tab
  STEP I: Channel Forecast
  The assumptions in this section will determine the number of IDN registrations that will be sold by the Registrar directly and the number that will be
  sold by the Registrar's reseller(s).
        Enter the percentage (%) of IDN registrations that will be sold by the Registrar directly. Excel will then calculate the percentage of IDNs sold
   A.                                                                                                                                                        Click to go there
        by a Registrar's reseller(s).

  STEP II: Registration Forecast
  The assumptions in this section will determine the registrations of IDNs.
   A. Enter your total number of domain names (non-IDN) that you expect at end of year 0 (this year).                                                        Click to go there
   B. Enter the total number of IDNs that you expect at the end of year 0 (this year).                                                                       Click to go there
   C. Enter the expected Renewal Rate (%) for domain names (non--IDN).                                                                                       Click to go there
   D. Enter the expected Renewal Rate (%) for IDNs.                                                                                                          Click to go there
   E. Enter the expected growth rate (%) for domain names (non-IDNs).                                                                                        Click to go there
   F. Enter the level of awareness (%) for IDNs among those who have registered other types of domain names.                                                 Click to go there
   G. Enter the percentage (%) who intend to purchase IDNs (of those who have registered other types of domain names).                                       Click to go there
   H. Enter the expected replacement rate (%) (the % of IDNs registered instead of other types of domain names).                                             Click to go there
   I. Enter the average number of IDNs registered per customer.                                                                                              Click to go there


  STEP IV: Pricing Forecast
  The assumptions in this section will determine the Registrar retail price and the Registrar reseller price. Prices are calculated using the mark-up as a
  percentage increase over the wholesale cost so that price = wholesale cost*(1+mark-up%). The Registrar's retail customers and reseller(s) pay
  upfront for the term of an IDN.
       Enter the Registrar Direct mark-up percentage (%). This is the percentage in which the Registrar marks up an IDN for direct sale to its
   A.                                                                                                                                                        Click to go there
       customers.
   B. Enter the Registrar Reseller mark-up percentage (%). This is the percentage in which the Registrar marks-up an IDN for sale to its reseller(s).        Click to go there

   C. Enter the length (in years) for the Average Registration term.                                                                                         Click to go there




Expense Assumptions Tab
  STEP I: Cost of Good Sold
  The assumptions in this section reflect the estimated cost of good sold.
       Enter the estimated cost of goods sold (as a % of total revenue) for fulfillment and delivery. Do not include the wholesale costs of IDNs due to
   A.                                                                                                                                                        Click to go there
       VeriSign.




     VeriSign Global Registry Services                                           be1b1b32-77d9-4c78-8ff0-6237e4b74e9c.xls                                                        Page 1
                                                                                                  Instructions




  STEP II: Sales/Marketing
  The assumptions in this section reflect the estimated costs for the sales and marketing efforts, including direct marketing, sales lead generation,
  marketing events, etc.
   A. Enter the estimated amount ($) for sales and marketing for IDN.                                                                                   Click to go there


  STEP III: Headcount
  The assumptions in this section reflect the estimated costs for employees.
   A. Enter the number of staff in different functions will be required to manage the IDN business. Use full-time equivalents (FTEs).                   Click to go there

        Enter an estimated "fully loaded" cost per FTE per month (salary, bonus, taxes, insurance, workspace, individual office equipment and other
   B.                                                                                                                                                   Click to go there
        directly associated costs).

  STEP IV: Other General and Administrative Expenses
  The assumptions in this section reflect the estimated costs for other general and administrative expenses not captured elsewhere in the model.
       Enter the estimate cost of annual maintenance associated with the registration system and/or other capital assets. Use a percentage (%) of
   A.                                                                                                                                                   Click to go there
       the initial value of these assets.
   B. Enter any additional costs not included elsewhere. Use a percentage (%) of the overall total costs.                                               Click to go there




Capital Expense (Capex) Assumptions Tab
  STEP I: Capital Expenditures
  The assumptions in this section reflect the estimated capital expenditures and depreciation information.
   A. Enter the estimated amounts ($) for capital expenditures.                                                                                         Click to go there
   B. Enter the number of years over which these assets will depreciated.                                                                               Click to go there




Results Tab
  STEP I: Income Statement
  This section displays the Income Statement for the Registrar based on the assumptions entered on the previous sheets.                                 Click to go there
  STEP II: Cash Flow and Payback Analysis
  This section displays the Cash Flow and Payback Analysis for the Registrar based on the assumptions entered on the previous sheets. Payback is
                                                                                                                                                        Click to go there
  indicated by the first month displayed in blue.
  STEP III: Breakeven Analysis
  This section calculates the breakeven point in units sold.
    A. Use "Goal Seek" to calculate an approximate break even point in units sold or enter estimated units sold in cell C57 (Units to Sell to Break     Click to go there




  KEY:
  IDN: Internationalized Domain Name


  NOTE: This model is greatly simplified and is only as accurate as the assumptions that are made.
  Updated: January 24, 2002




     VeriSign Global Registry Services                                           be1b1b32-77d9-4c78-8ff0-6237e4b74e9c.xls                                                   Page 2
          VeriSign Confidential                                                                           Revenue Assumptions




Registrar Revenue Assumptions

I. Channel Forecast

A. Registrations by channel
   % sold through Registrar directly:                                 50%
   % sold through reseller(s):                                        50%

II. Registration Forecast
                                                                   Now
     Domain Name Growth                                           Year 0        Year 1              Year 2              Year 3
A.   Total Domain Names                                           100,000
B.   Total IDNs                                                    25,000
C.   Domain Name renewal rate                                                            60%                 60%                  60%
D.   IDN renewal rate                                                                    60%                 60%                  60%
E.   Annual growth rate for new Domain Names                                             10%                 12%                  15%
F.   Awareness of IDN among Registrants of other Domain Names                            50%                 65%                  80%
G.   Intent to purchase                                                                  16%                 18%                  20%

   IDNs Replacing Other Domain Names
H. Other Domain Name replacement rate                                                     4%                  4%                   4%
   New Growth (IDNs)                                                                     96%                 96%                  96%

   IDNs per Customer
I. IDNs per customer (avg. number purchased)                                              1.0                 3.0                  2.0

     IDN Registrations
                                                                                Year 1              Year 2              Year 3
     Addressable Domain Name Market
     Beginning of year Domain Name Total                                           100,000               70,000              50,400
     Renewal Domain Names                                                           60,000               42,000              30,240
     New Domain Names (added)                                                       10,000                8,400                  7,560
     Base level Domain Names                                                        70,000               50,400              37,800

     Awareness of IDN among ASCII.ASCII Domain Name Registrants                     35,000               32,760              30,240
     Intent to purchase                                                              5,600                5,897                  6,048


     New IDNs registered                                                             5,600               17,690              12,096
               Replacement of ASCII Base                                                 224                 708                  484
                 New Growth (IDNs)                                                   5,376               16,983              11,612

     IDN renewals                                                                   15,000               12,360              18,030

     Total IDN registrations and renewals                                           20,600               30,050              30,126
     Total Revenue                                                          $      370,800      $       540,907     $       542,272

III. Pricing Forecast
     Sales Pricing
A.   Registrar Direct Mark-up%:               300%
B.   Registrar Reseller Mark-up%:             100%
C.   Average Registration Term Length          1.00
D.   Wholesale cost per IDN per year          $6.00

     Wholesale Cost                      $     6.00
     Registrar Direct Retail Price       $    24.00
     Registrar Reseller Price            $    12.00




          VeriSign Global Registry Services                                                     be1b1b32-77d9-4c78-8ff0-6237e4b74e9c.xls   Page 3
                                                               Expense Assumptions




Registrar Expense Assumptions
                                                                               Year 1              Year 2              Year 3
I. Cost of Goods Sold
                                                                                                                                            Total
   IDN Wholesale Cost                                                      $      123,600      $      180,302      $       180,757      $       484,660
   Total IDN Wholesale Cost                                                $      123,600      $      180,302      $       180,757      $       484,660


A. Other Cost of Good Sold              (% of total revenue)         5% $            18,540    $       27,045      $        27,114      $           72,699

II: Sales/Marketing
A. Marketing                                                               $         15,000    $       15,000      $        15,000      $           45,000

III. Headcount
   (Full time equivalent)
A. Sales and Marketing FTEs                                                             0.25
   Technical FTEs                                                                       0.25
   Operations FTE                                                                       0.15
   Customer Support FTE                                                                 0.25
   Management FTE                                                                       0.10
   Total FTEs                                                                           1.00                 -                    -
   Cumulative FTEs                                                                      1.00                1.00                 1.00

B. Average Total Cost per FTE                                   $ 50,000                                                                    Total
   Headcount Total Cost                                                    $         50,000    $       50,000      $        50,000      $       150,000

IV. Other General & Admin Expenses
                                                                                                                                            Total
A. Annual Maintenance as % Capex                                    10% $               -      $          -        $              -     $              -
B. % of overall cost base                                            1% $             2,071    $        2,723      $            2,729   $            7,524




    VeriSign Global Registry Services            be1b1b32-77d9-4c78-8ff0-6237e4b74e9c.xls                                                     Page 4
                                           Capital Expenditure Assumptions



Registrar Capital Expenditures (Capex)

                               A.              B.
                                                           Annual
                        Total investment   Depreciated
Item                                                    Depreciation         Year 1                Year 2            Year 3
                                ($)        over # years
                                                          Expense
Software                                              5 $        -     $              -        $        -        $            -
Hardware                                              5 $        -     $              -        $        -        $            -
Other                                                 5 $        -     $              -        $        -        $            -
Other                                                 5 $        -     $              -        $        -        $            -
Other                                                 5 $        -     $              -        $        -        $            -

TOTAL                                 $0       Total Capex Expense                        $0                $0                    $0




VeriSign Global Registry Services   be1b1b32-77d9-4c78-8ff0-6237e4b74e9c.xls                                             Page 5
                                                                                                                                                      Results




Income Statement, Payback Analysis, Market Comparison and Breakeven Analysis

I. Income Statement
                                                      Year 1                 Year 2                Year 3             Program Total
Revenues
    IDN Direct Sales                           $           247,200       $      360,605    $           361,515    $          969,320
    IDN Reseller Sales                         $           123,600       $      180,302    $           180,757    $          484,660

     TOTAL REVENUES                            $           370,800       $      540,907    $           542,272    $         1,453,980

     Cost of Goods Sold                        $           142,140       $      207,348    $           207,871    $          557,359
     Sales and Marketing                       $            15,000       $       15,000    $            15,000    $           45,000
     Headcount                                 $            50,000       $       50,000    $            50,000    $          150,000
     Other G&A                                 $             2,071       $        2,723    $             2,729    $            7,524

     TOTAL EXPENSES                            $           209,211       $      275,071    $           275,600    $          759,882

     OPERATING PROFIT                          $           161,589       $      265,836    $           266,673    $          694,097

     Depreciation Expense                      $                -        $            -    $                -     $               -
     Interest Expense                          $                -        $            -    $                -     $               -

     NET INCOME                                $           161,589       $      265,836    $           266,673    $          694,097

II. Cash Flow and Payback Analysis
     Cash Inflows                              $           370,800 $             540,907 $             542,272
     Cash Outflows                             $          (209,211) $           (275,071) $           (275,600)
     NET CASH FLOW                             $           161,589 $             265,836 $             266,673

     PAYBACK ANALYSIS                          $           161,589       $      427,425    $           694,097

III. Breakeven Analysis
     Average Selling Price                     $                    18
     Average COGS                              $                     7

     Average Investment + Expenses             $           202,524
     Average Gross Margin                      $           202,524
     Difference                                $               -

     Units to Sell to Breakeven                             18,245

     Use "Goal Seek" to determine the average number of units that need to be sold to breakeven.
     1. Under "Tools" Menu, select "Goal Seek"
     2. Enter the following into the "Goal Seek" dialog box:
                                        Set cell:                $C55
                                       To value:                      0
                               By changing cell:               $C$57
     3. Click "OK"
     4. "Goal Seek" will display the results.
     5. Click "OK" if you want to change the spreadsheet with the results of the "Goal
     Seek" calculation or click "Cancel" to leave the spreadsheet as it was before you used
     the "Goal Seek" tool.




         VeriSign Global Registry Services                                                                                            be1b1b32-77d9-4c78-8ff0-6237e4b74e9c.xls   Page 6

				
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