What changed in this filing

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Item 1. Business

2022-02-18 compared with 2021-02-19 · 67 added, 61 removed, 246 unchanged (34% of the section changed)

28 unchanged sentences

This list may be updated from time to time on our investor relations website.

https://www.Facebook.com/Verisign

https://www.Twitter.com/Verisign

https://www.LinkedIn.com/company/Verisign

https://www.YouTube.com/user/Verisign

https://www.Verisign.com

https://facebook.com/Verisign

https://twitter.com/Verisign

https://linkedIn.com/company/Verisign

https://youTube.com/user/Verisign

https://verisign.com

https://blog.Verisign.com

The contents of these websites are not intended to be incorporated by reference into this Form 10-K or in any other report or document we file.

We operate the authoritative directory of and/or the back-end systems for all .com, .net, .cc, .tv, .gov, .jobs, .edu and .name domain names, among others.

We operate the authoritative directory of and/or the back-end systems for all .com, .net, .cc, .gov, .edu and .name domain names, among others.

Our services allow individuals and organizations to establish their online identities, while providing the secure, always-on access they need to communicate and transact reliably with large-scale online audiences.

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We are also the exclusive registry of domain names within certain transliterations of .com and .net in a number of different native languages and scripts (“IDN gTLDs”).

As a registry, we maintain the master directory of all second-level domain names (e.g., example.com and example.net) in these gTLDs and IDN gTLDs.

As a registry, we maintain the authoritative directory of all second-level domain names (e.g., example.com and example.net) in these gTLDs and IDN gTLDs.

Our global constellation of DNS servers provides internet protocol (“IP”) address information in response to queries, enabling the use of browsers, email systems, and other systems on the internet.

In addition, we own and maintain the shared registration system that allows ICANN-accredited registrars to enter new second-level domain names into central directories and to submit modifications, transfers, re-registrations, and deletions for existing second-level domain names (“Shared Registration System”).

In addition to our registry agreements with ICANN, we have agreements to operate the registries for the .tv and .cc country code top-level domains (“ccTLDs”) for Tuvalu and Cocos (Keeling) Islands, respectively, and to operate the back-end registry systems for the .gov , .jobs, and .edu sponsored TLDs, among others.

In addition, we own and maintain our shared registration system that allows ICANN-accredited registrars to enter new second-level domain names into Verisign operated central directories and to submit modifications, transfers, re-registrations, and deletions for existing second-level domain names (“Shared Registration System”).

In addition to our registry agreements with ICANN, we have agreements to operate the registries for the .tv and .cc country code top-level domains (“ccTLDs”) for Tuvalu and Cocos (Keeling) Islands, respectively, and to operate the technical systems for the .gov and .edu sponsored TLDs.

These TLDs are also supported by our global constellation of DNS servers and Shared Registration System.

We did not participate in the Tuvalu government’s rebid of the contract to operate .tv , and we anticipate transitioning the operation of the .tv registry during 2022.

We will continue to operate .tv until the transition.

We also provide internationalized domain name (“IDN”) services that enable internet users to access domain names in characters representing their local language.

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The fees charged for .com , .net and .name may only be increased according to adjustments prescribed in our agreements with ICANN over the applicable term.

Revenues for .cc and .tv domain names and our IDN gTLDs are based on a similar fee system and registration system, although the fees charged are not subject to the same pricing restrictions as those imposed by the DOC on .com , or ICANN with respect to .net and .name .

com , as established in the Cooperative Agreement and the .

com Registry Agreement, and for .

name , as established in those respective Registry Agreements.

The fees received from operating the .

gov registry are based on the terms of Verisign’s agreement with the U.S.

The fees received from operating the .jobs registry infrastructure, and that of others for which Verisign provides such services, are based on the terms of Verisign’s agreements with those respective registry operators .

gov TLD are based on the terms of Verisign’s agreement with the U.S.

The fees from our performance of the technical operations for other TLDs, are based on the terms of Verisign’s agreements with those respective registry operators .

Operations Infrastructure

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Our domain name servers refer requestors to the associated authoritative name servers for second level domains under our TLDs, thus enabling DNS resolution for every .com and .net domain name on the internet and for domain names under a large number of other TLDs.

Our servers process more than 215 billion queries daily.

Our operations infrastructure operates 24 hours a day, supporting our services.

Our servers process hundreds of billions of queries daily.

Our operations infrastructure operates 24 hours a day, supporting the security, integrity and availability of our services.

The performance and availability of our infrastructure are critical for our business.

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• Distributed Servers:

We operate a large number of high-speed servers globally to support localized capacity and performance demands.

We operate a large number of high-speed servers globally to support localized transaction volume and performance demands.

In conjunction with our proprietary software, processes and procedures, this global constellation of servers offers rapid failover, global and local load balancing, and threshold monitoring on critical servers.

• Networking:

We deploy and maintain a redundant and diverse global network, maintain high-speed, redundant connections to numerous internet service providers, and maintain peering relationships globally to ensure that our critical services are readily accessible to customers at all times.

We incorporate architectural concepts such as protected domains, restricted nodes, and distributed access control in our system architecture.

In addition, we employ firewalls and intrusion detection software, as well as proprietary security mechanisms at many points across our infrastructure.

We perform recurring internal vulnerability testing and controls audits, and also contract with third-party security consultants who perform periodic penetration tests and security risk assessments on our systems.

We have engineered resiliency and diversity into how we host classes of products throughout our set of interconnected sites to mitigate unknown vendor defects and zero-hour security vulnerabilities.

We perform continuous internal vulnerability testing and periodic controls audits, and also contract with third-party security organizations to perform periodic penetration tests and security risk assessments on our systems.

We have engineered resiliency and diversity into how we host classes of products throughout our set of interconnected sites to reduce the risk of unknown vendor defects and zero-day security vulnerabilities.

This includes different physical security silos, which themselves are separated into bulkheads, and in which servers are located.

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Thus, the corporate networks to which personnel directly connect are separated from the silos that house production services;

administration of production gear from corporate systems must go through an internal, fortified intermediary;

and account credentials used within the corporate networks are not used within the production silos, nor on the fortified systems.

administration of production gear from corporate systems must go through internal, fortified intermediaries;

and account credentials used within the corporate networks are not used within the production silos.

• Data Integrity:

We employ both phased and systemic integrity validation operations via a number of proprietary mechanisms on all internal DNS publication operations.

We have continuously expanded our infrastructure to meet demands to support normal and peak system load and attack volumes based on what we have experienced historically, as well as to address projected internet attack trends.

Call Centers and Help Desk:

We continuously expand our infrastructure to meet demands to support normal and peak system load and attack volumes based on what we have experienced historically, as well as to address projected internet attack trends.

Call Centers and Service Desk:

We provide customer support services over the phone, by email and through web-based self-help systems.

Our support teams are staffed with trained technical customer support agents.

Support is available for customers 24 hours a day, every day of the year.

Support is available for customers 24 hours a day.

Throughout the COVID-19 pandemic, our support teams have continued servicing our customers while working remotely.

Operations Support and Monitoring:

Through our network operations center, we have an extensive monitoring capability that enables us to track the status and performance of our critical database systems and our global resolution systems.

Our network operations center monitors our systems 24 hours a day, every day of the year and has continued to be staffed by employees working remotely during the COVID-19 pandemic.

Through our network operations center, we have an extensive monitoring capability that enables us to track the status and performance of our critical systems, network and services.

Our network operations center monitors our systems 24 hours a day and has continued to be staffed by employees working remotely during the COVID-19 pandemic.

Disaster Recovery Plans:

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We face competition in the domain name registry space from other gTLD and ccTLD registries that are competing for the business of entities and individuals that are seeking to obtain a domain name registration.

In addition to the gTLDs and ccTLDs we operate or for which we provide back-end registry services, there are over 1,200 other operational gTLD registries, over 250 ASCII ccTLD registries, more than 50 IDN ccTLD registries, and over 90 IDN gTLD registries.

In addition to the gTLD and ccTLD registries we operate or for which we provide back-end registry services, there are over 1,100 other operational gTLD registries, over 250 ASCII ccTLD registries, more than 50 IDN ccTLD registries, and over 90 IDN gTLD registries.

Under our agreements with ICANN, we are subject to certain restrictions in the operation of .com , .net and .name on pricing, bundling, marketing, methods of distribution, introduction of new registry services, and use of registrars, that do not apply to ccTLDs and other gTLDs and therefore may create a competitive disadvantage.

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New technologies and the expansion of existing technologies may increase competitive pressure.

In addition, our industry is characterized by collaborative relationships involving, and consolidation of, our competitors.

Our industry is characterized by collaborative relationships involving our competitors.

In the past, certain of our competitors have consolidated.

Our ability to participate and benefit from such collaborative arrangements or consolidations may be limited and such collaborative arrangements and consolidations could harm our competitive position and adversely impact our business.

We compete with numerous companies that offer outsourced domain name registration, resolution and other DNS services to registries that require a reliable and scalable infrastructure.

Among our competitors are Donuts, CentralNic Ltd., and GoDaddy.

Industry Regulation

6 unchanged sentences

For example, in response to the General Data Protection Regulation, ICANN issued a Temporary Policy modifying public access to information from the Whois services delivered by registrars and registries.

We are also subject to country-level laws and regulations in the United States and in foreign countries.

We are also subject to country-level laws and regulations in the United States and in international locations.

In China, we are required to maintain licenses for .

net TLDs under regulations issued by the Ministry of Industry and Information Technology.

The licenses for the .

net TLDs must be renewed in 2022.

net, .tv and .cc under regulations issued by the Ministry of Industry and Information Technology.

The licenses for .com and .net must be renewed in 2022.

Additionally, in many jurisdictions in which we operate, including California, the European Union, the United Kingdom, China and elsewhere, strict new data security and data privacy regulations have been, or are being, adopted.

Because we do not possess extensive personal information, we have not yet experienced significant impacts from these regulations.

However, compliance costs and other business impacts could become significant as regulatory enforcement increases, as courts interpret these regulations, and as new laws and regulations continue to be adopted.

However, compliance costs and other business impacts could become significant if we begin to receive personal registrant information in our .

net TLDs and as regulatory enforcement increases, as courts interpret these regulations, and as new laws and regulations continue to be adopted.

Other regulations, or changes to regulations, may also impact our business operations, including changes to the Digital Services Act or Network and Information Security Directive, in the European Union, or the Communications Decency Act, in the United States.

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The current term of the .com Registry Agreement is six years and must be renewed or extended by November 30, 2024.

The .com Registry Agreement contains a “presumptive” right of renewal;

although, ICANN could terminate or refuse to renew.

Although the .com Registry Agreement contains a “presumptive” right of renewal, ICANN could terminate or refuse to renew the Registry Agreement.

See “Risk Factors - Any loss or modification of our right to operate the .

14 unchanged sentences

The Cooperative Agreement has undergone various amendments with the most recent, Amendment 35, on October 26, 2018.

Amendment 35 extended the term of the Cooperative Agreement until November 30, 2024, which will automatically renew on the same terms

for successive six-year terms unless the DOC provides written notice of non-renewal 120 days prior to the end of the then-current term.

Amendment 35 extended the term of the Cooperative Agreement until November 30, 2024, which will automatically renew on the same terms for successive six-year terms unless the DOC provides written notice of non-renewal 120 days prior to the end of the then-current term.

Amendment 35 includes the DOC’s consent to the modification of the pricing terms in the .

com Registry Agreement (as described above).

Further, we are entitled to increase the Maximum Price of a .com domain name due to the imposition of any new Consensus Policy or documented extraordinary expense resulting from an attack or threat of attack on the Security or Stability of the DNS as described in the .com Registry Agreement, provided that we may not exercise such right unless the DOC provides prior written approval that the exercise of such right will serve the public interest, such approval not to be unreasonably withheld.

The Cooperative Agreement further provides that we shall be entitled at any time during the term of the .com Registry Agreement to seek to remove the pricing restrictions contained in the .com Registry Agreement if we demonstrate to the DOC that market conditions no longer warrant pricing restrictions in the .com Registry Agreement, as determined by the DOC.

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No U.S.-based employees are represented under collective bargaining agreements.

Based on periodic monitoring, we believe that our employee turnover rate is low compared to competitive benchmarks and historical trends.

We attribute our strong retention rates to our passion and focus on the Company’s mission, values, continual development of talent, and provision of competitive and equitable reward programs.

Based on periodic monitoring, we believe that our employee turnover rate is relatively low compared to competitive benchmarks and historical trends.

We attribute our strong retention rates to our passion and focus on the Company’s mission and values, continual development of talent, and the delivery of competitive and equitable reward programs.

We regularly review our workforce policies, procedures, and training programs, as well as our overall workforce demographics, in an effort to create a work environment that is diverse, equitable, inclusive, and free from discrimination.

Key human capital areas that we focus on in managing our business include Employee Engagement and Retention, Compensation and Employee Benefits, Talent Development, and Talent Acquisition.

Key human capital areas that we focus on in managing our business include Employee Engagement and Retention, Diversity, Equity and Inclusion, Compensation and Employee Benefits, Talent Development, and Talent Acquisition.

• Employee Engagement and Retention:

We use employee feedback to monitor morale and engagement.

During 2020, we conducted two surveys to better understand our employees’ well-being during the COVID-19 pandemic and to more effectively guide our response.

Over 86% of the employee population participated in these surveys.

The results indicated high satisfaction rates with our response to the pandemic, as well as our communications during the pandemic.

In addition, the survey results indicated that our employees remain highly engaged.

In a separate Ethics and Compliance survey, which 90% of our employees completed, the results indicated that our employees believe we live our values and have a culture that is inclusive and ethical.

We are a diverse organization, and we believe that drives stronger performance, better decision making, and a culture where differences are valued.

We continue to focus on the hiring, retention, and advancement of women and underrepresented populations.

During 2021, we conducted several surveys to better understand our employees’ well-being during the COVID-19 pandemic and to more effectively guide our response.

These surveys included two directed to all employees, one directed only to our

onsite employees and one directed only to our leaders.

At least 85% of the applicable employee populations participated in each of these surveys.

The results indicated high satisfaction rates with our on-going response to, and communications during, the pandemic.

In addition, the survey results indicated that our employees remain highly engaged and connected with our mission and values.

Moreover, when we hire talent, they tend to stay.

The average tenure of our employees is approximately 8 years and we maintain comparatively low employee turnover rates.

The average tenure of our employees is approximately 9 years.

• Diversity, Equity and Inclusion (DEI):

We are a diverse organization, and we believe that drives stronger performance, better decision making, and a culture where differences are valued.

We continue to focus on the hiring, retention, and advancement of women and underrepresented populations, and we are committed to making progress towards increasing workforce diversity.

In 2021, we conducted a diversity, equity and inclusion review of our recruiting, retention and workplace processes with the help of an outside advisor.

This resulted in the development of a comprehensive strategy and roadmap designed to assist us in building upon our strong foundation while outlining areas for improvement.

• Compensation and Employee Benefits:

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We benchmark for market practices and regularly review our compensation and benefits against the market to confirm they remain competitive.

We also offer a comprehensive set of benefits.

We also offer a broad and comprehensive set of benefits to meet the needs of our diverse workforce.

We regularly perform adverse impact analyses on base pay, annual incentives and long-term incentives to help calibrate compensation.

• Talent Development:

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Strategic talent reviews and succession planning occur on a regular basis.

Our management training is designed to increase capability in the areas of communication, engagement, coaching, conflict management and business skills, and to foster an ethical, supportive work environment free from bias and harassment.

Our management training is designed to increase capability in the areas of communication, engagement, coaching, conflict management and business skills, while fostering an ethical, supportive work environment free from bias and harassment.

We sponsor continuous skill development for all employees through our online learning and development platform.

In addition, we host a series of in-person and on-demand learning sessions designed to build our team’s skills and knowledge required for the future.

In addition, we host a series of instructor-led and on-demand learning sessions designed to build our team’s skills and knowledge required for the future.

• Talent Acquisition:

We are focused on the increasingly competitive labor market, and we are working diligently to attract the best talent from a diverse range of sources.

Over the last several years we have refreshed our employment branding and developed targeted recruitment strategies for specialized skill sets.

To assist in this effort, we have broadened our sourcing strategies, refreshed our employment branding and developed targeted recruitment strategies for specialized skill sets.

In 2021, we hired 82 new employees.

During the COVID-19 pandemic, the safety and well-being of our employees has remained a key focus.

Beginning in March 2020, we transitioned approximately 95% of our employees to a work-from-home status.

To protect the health of our employees who work on site, we have implemented rigorous cleaning and safety protocols for our facilities.

We adjusted employee leave and other policies with the intention of ensuring that our workforce had the flexibility it needed to manage personal challenges arising from the pandemic.

During the COVID-19 pandemic, the safety and well-being of our employees has remained a key focus and priority.

Throughout 2021, approximately 94% of our employees continued in a work-from-home status.

To protect the health of our employees who work on site, we have rigorous cleaning and safety protocols for our facilities.

We also track the vaccination status of our employees in order to respond, as applicable, to any requirements or mandates by government regulation.

We adjusted employee leave and other policies with the intention of providing our workforce with flexibility it needs to manage personal challenges arising from the pandemic.

We enhanced mental health resources available to our employees, and unique individual requirements are supported to the greatest degree possible.

In addition, we have taken steps to ensure that our employees have the equipment and resources that they require to work remotely.

Finally, to reinforce our connection with our employees, we have significantly increased leadership updates and management outreach.

The health and well-being of our workforce remain a priority.

We also continue to provide our employees with the equipment and resources that they require to work remotely.

Finally, we monitor the physical and mental well-being of our employees through frequent leadership updates and regular management outreach.

The following table shows a comparison of our consolidated employee headcount, by function:

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business