12|23|2010 02:27 pm EDT
As we had reported earlier this year, Demand Media, parent company of numerous registrars, websites and a domain parking company, was planning to file for an IPO in 2010. According to an article by CNNMoney, the IPO has now stalled due to the regulator’s questions regarding Demand Media’s accounting practices.
The company’s CEO, Richard Rosenblatt has always insisted that the company was profitable, but the IPO filing revealed a different story, showing that the company is in the red for at least for $6 million USD for 2010. One of the reasons the filings are being investigated is that Demand Media expenses the cost of content creation over the course of five years, stating that the average time period this content will generate revenue for is 5.4 years.