Pricing at GoDaddy for NeuStar’s .us and .biz domains is oddly high.
In February I wrote about GoDaddy’s price increase for .biz domain names. The registrar was charging $14.99 for .biz domain names, even though its wholesale cost at the registry is about the same as .com domain names (which GoDaddy sells for $9.99). It appeared that GoDaddy was just trying to make some extra profit.
But a couple weeks ago a friend pointed out that I may have missed the boat on this one. He said “Isn’t NeuStar the registry for .biz?”
Suddenly, it clicked. Indeed, NeuLevel is the registry operator for .biz. It’s essentially the same company as NeuStar, which runs the .us domain registry. GoDaddy has a history with NeuStar. Last year it teamed up with .info registry Afilias to try to win the registry rights for .us. NeuStar prevailed in the battle.
Could it be that GoDaddy is charging more for .us and .biz to shun NeuStar and put GoDaddy in a position to win the registry business in the future? Take a look at the search results when you plug in a domain at GoDaddy:
Hmm. You can choose all of the key domains, such as .com/.net/.org. You can even sign up for some more expensive ones like .tv. Heck, GoDaddy is even promoting .info, even though it’s only charging 99 cents for the first year. You have to scroll down to see an option to register .us and .biz domains.
So is GoDaddy playing hardball with NeuStar or is it just a conspiracy theory? I asked GoDaddy VP of Public Relations Elizabeth Driscoll about the theory via e-mail today. She responded:
“Our price points are a product of our internal research, testing and other market indicators.
Keep in mind we rotate ‘sales’ throughout the year — at times to coincide with topical events. For example, we had a .US promotion underway around Memorial Day, during which one-year .US registrations were just $8.99.
Perhaps the most important element for you to consider is this: Go Daddy registers more domain names than anyone else — by far! We have a 45% new domain name market share. Go Daddy is very much interested in the continued success of all the tlds we offer [her emphasis].”
That’s fair. But with 30 million domains and growing, the company certainly can twist some arms while helping out its friends at Afilias. Come to think of it, if I owned a registry I’d be working hard to make sure GoDaddy promoted my TLD.
Disclaimer: I LOVE conspiracy theories.
I don’t see anything sinister here however. Anyone that pays attention to GoDaddy’s prices over an extended period of time will notice that they change their rates (sales & standard pricing) very frequently with no hint of rhyme or reason. Yeah, .com has been a consistent $9.99 but hell, that’s .com, people notice that one more.
They play around with the prices to try to find the sweet spot that largest number of their customers will pay. Remember also they (probably) have more non-domainer customers than anyone and end-users don’t notice the price swings.
B-sides, .biz is a weak TLD, I’ve noticed a lot of registrars price them higher, probably to make up for the lower volume of registrations.
@ Germ – you may be right. That was my initial thought, too…until someone planted this in my ear.
They used to have .us all the time, and not rotate it. They don’t rotate the .net or the .info. How about .ws, .cc? When will those be rotated in.
GoDaddy still has it’s eye on managing the .us. Keeping it rotated out of the lineup, will help their chances of getting this mismanaged cctld in 2.5 years.
They have laso taken .us of there homepage when you search for a name,
they have .com/.net/.info/.org/.tv/.mobi
Thats the first time it’s not been on since they started selling names.
.us has got no chance when nuestar is still running the show.
as long as the top mans making money.
thats all they care about 🙂
Chris Nielsen says
I think the “wholesale cost” of most domains is only about $6.25 right? So it must be sheer size and a “captive” market that allows such excessive (in my opinion) prices to continue. Frankly, I don’t know why GD is so popular aside from their marketing ability and great customer service. I suppose that’s worth paying a little more for.
But when you can register most domains for only $6.99 for the first year and $7.99 after that at places like Domainsite, you would think they would be more popular.
I remember when GD was going to partner on the .us domains and at the time I thought “If GD is going to be promoting .us, then I suspect it could become the #2 TLD in popularity much sooner.”. I didn’t invest heavily in .us, but I do like it and own quite a few.
@ Chris – earning a few bucks profit per name isn’t much, especially when you offer telephone support. Many people criticize GoDaddy for having prices that are too low and having service commiserate with that.