Department of Justice recommends disallowing integration on certain existing top level domain names.
The U.S. Department of Justice’s Antitrust Division has advised ICANN that it should halt its plans to allow some existing top level domain name registries to own registrars.
National Telecommunications and Information Administration (NTIA) Administrator Lawrence Strickling had asked the Department of Justice to review ICANN’s decision to allow registry-registrar integration on existing top level domain names.
The Department of Justice believes (pdf) that allowing cross-ownership on existing top level domain names that have price caps could be harmful. It recommends ICANN not allow this unless it determines that price caps no longer constrain the exercise of market power. It believes the removal of the ownership restriction would lead to substantial price increases for .com, .net, and .org, and may lead to price increases for .biz and .info.
New top level domain names are less likely to obtain market power, the DOJ says. So it does not believe cross ownership will be a significant issue with new top level domain names.
The DOJ’s analysis may put a crimp on plans by existing registries to integrate. Neustar has been vocal about plans to integrate.
Interestingly, integrating may actually remove practical price caps altogether. There’s been talk of registries adopting the new TLD registry agreement if they want to integrate. The new TLD agreement has lax controls on pricing.