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.
Well start charging it on your sales people, people like Andrew Reyberry are bringing average domain prices domain faster than you can yell timber. Once they are sold, no dividends, that asset is gone.
I’m surprised they offer public comment.. They never give two hoots anyway
George Kirikos says
I think you meant “VeriSign would pocket over $1 billion a year”, not ICANN.
Andrew Allemann says
@ George Kirikos – thanks. That’s what I get for writing a story late at night.
Shaun Pilfold says
Verisign/Icann deal aside, at 7% increase a year, I will be paying the same rate by 2034 to register/renew a domain as I was in 1999 ($35 a year) …not so bad.
“Why should registry costs increase 7% a year?”
Hey Ron. Why do you turn every thread about anything domain related in to Andrew Reberry blah blah. Go buy all his domains if he’s selling them all too cheap . please stop the astroturfing.
Thanks, for studying my posts Adam, I am glad I peek your interest.
Kevin Murphy says
Not sure “blame ICANN” is totally fair.
The reason these fee increases are in the contract is that Verisign sued ICANN, remember.
Andrew Allemann says
@ Kevin Murphy – yes. And ICANN settled with VeriSign b/c it believed it had do at that point, which means it messed up some time earlier by not anticipating the contract issues with VeriSign.
George Kirikos says
Andrew: No problem…..I notice myself making more typos, due to the rush to hit “send” these days.
This is a monopoly.
dot-com prices should be like $2-$3 per domain and the registry will still make lots of money on over 100 million domains registered.
Can ICANN be forced to put this contact for open bidding?
So is there a chance that someone will prevent this new agreement from being implemented?
Some big companies in domaining space, etc?
What exactly do all these yearly increases pay for? All these new extensions are not needed as well. They need to be better regulated.
Icann is looking at making hundreds of millions from the new tlds.
Why should Icann get distracted by conducting the fiduciary responsibility for which they were created?
Isn’t Verisign’s motto –
“If you scratch my back and I’ll scratch yours”.
net catalyst says
The only way, apparently, to get any ‘action’ from US Govt is to organize an online protest….like the protest that got SOPA waylaid; despite having been all but signed, sealed and delivered to the Hollywood and Recording Industry.
Given the number of domains registered that are subject to the unreasonably high domain registry fee / and automatic 7% ‘kicker’ irrespective of reasonable basis – I would think that given ICANN’s sensitivities to international efforts to reign in its powers, a wide ranging protest could help motivate ICANN and US Govt to pay more attention to the issue.
Just a thought …. net catalyst
happen to have the url: netcatalyst.org available for such proposed action (g)
Andrew, if this trend holds, we’ll see wholesale registration prices touching $15.5 in a decade. Adding profit margins for registrar, it could hit $20 within a decade pretty quickly. This is going to make speculative registrations a lot harder to manage.
How come no public comments were submitted yet on ICANN’s board? George where are you? Lol
Also people should sign this petition: