Why should registry costs increase 7% a year?
ICANN has published a proposed agreement to renew the .com contract with VeriSign.
As expected, the agreement allows VeriSign to hike prices 7% in four of the next six years. This is similar to the current contract.
Under the terms of the proposed contract, VeriSign’s take for each .com registration in 2012 is $7.85 per year. That doesn’t include ICANN’s current “tax” of 18 cents per year.
The company can increase fees 7% in four of the next six years. That means by 2016 the wholesale price exclusive of ICANN’s fees could be $10.29, or a 31% increase over today’s fees.
ICANN VeriSign would pocket over $1 billion a year for running the .com registry.
Surely if it was sent out to competitive bid this would be done for about $200 million or so a year. But that’s not going to happen.
Why VeriSign runs .net at $5.11 a year but so much more for .com, with almost 10x as many domains, just doesn’t make sense.
Like I’ve said many times, don’t blame VeriSign for this. They’re brilliant. Blame ICANN.