Don’t worry about Verisign unjustifiably increasing .com prices.
There’s been a lot of concern about the .com contract extension and what it means for .com prices going forward.
The concern is that Verisign (NYSE:VRSN) can decide to not renew its Cooperative Agreement with the NTIA once the U.S. government gets out of its role in basic internet functions. Because the Cooperative Agreement includes pricing, people are worried Verisign can jack up its prices.
I never thought I’d say this, but I have Ted Cruz to thank for getting a clear answer on why Verisign won’t be able to increase .com prices at will.
He sent a letter to the DOJ asking about this. The DOJ has responded (pdf), and now it makes sense:
Moreover, if NTIA were to approve an extension of the .com Registry Agreement, it would have the right in its sole discretion to extend the term of the Cooperative Agreement with the current price cap in place until 2024 at any time prior to November 30, 2018, the date on which the Cooperative Agreement is currently scheduled to expire. If this occurs, the $7.85 fee cap would be extended another six years to 2024.
In other words: The Cooperative Agreement is currently in effect. NTIA gets to approve the .com contract extension. When it does, it can also force the extension of the Cooperative Agreement. This will give the U.S. government the ability to control .com prices going forward.