Here are my thoughts after processing ICANN’s pricing decision for the past two weeks.
It’s been two weeks since ICANN quietly announced that it was going forward with removing price caps on .org, .biz and .info domain names.
The comment period was a farce. ICANN–or a few people in ICANN–decided they wanted to get out of the price control business.
What’s interesting here is that it doesn’t seem that this change was brought on by the registries that stand to benefit. Maybe they asked, but I don’t think they made a big push for price cap removal. After all, they already had generous 10%-a-year increases in their contracts.
There’s no reason to spew hate on the registries at this time. This was all ICANN.
In making the pricing proposal, ICANN stated:
This change will not only allow the .org renewal agreement to better conform with the base registry agreement, but also takes into consideration the maturation of the domain name market and the goal of treating the Registry Operator equitably with registry operators of new gTLDs and other legacy gTLDs utilizing the base registry agreement
ICANN now has a goal of treating all registry operators the same, even though legacy TLDs were launched in an entirely different market. Even though current domain owners are “stuck” with the domains they have.
There is a very high switching cost to domain names. A company that has used a domain for decades could suddenly face a steep renewal fee. It then has three choices:
- Expend resources and money to switch to another domain. Change all of its email, set up SEO redirects, etc.
- Pay the higher price
- Renew now for ten years
It’s the last option that ICANN says protects domain registrants. They can renew their domain now at today’s price, assuming they realize the fees are about to increase.
But that just kicks the can down the road for ten years. It’s typical bureaucrat thinking. It will be Göran Marby’s unfortunate legacy.
In the near term, I don’t expect the impacted registries to make significant price increases. In fact, I suspect .org registry Public Interest Group may increase prices less over the next few years than it would have had it had the old 10% price increase option because now it’s under the microscope.
The long term is a different story. It’s likely that first-year prices will remain low through promotions but renewal prices will increase. And if one of these registries decides to sell itself to a private equity group or another company? All bets are off.
It is good. I really don’t care as long as they are not stupid % rises.
You should care, as ICANN is operating outside it’s mandate. Looks like to me a few key parties are going to enrich themselves after the dust settles. These deals are done to quietly, what is the rush?
Absolutely agree with Mike #2. This is irresponsible and they obviously crawl up to .com.
Most domain names are registered to the average joe and they own less than 5 domains per person so the price increases do not affect most people…
The domainers with the large portfolios are the ones who are going to be whacked if the prices go out of control.
Chuck D says
Cash grab as usual by ICANN, nothing new! Reminds me of the idea that GLTDs are going to be the next big thing, the only organization that has made real money is ICANN and a few registries (3?) I would love to know those numbers…
Fact is domain name investors are getting screwed and continue to because we are easy targets and do not have a centralized voice or power. Meanwhile if every domain name owner pledged to drop any of these extensions if even a penny increase, it would not happen. Band together and demand lower prices or risk dropping millions of names and billions in top line revenue, try that? We collectively are the cash flow for the entire industry of registrations, renewals, drops and aftermarket. If only we realized that would change occur, meanwhile if they SAY they are going to bump fees, then you believe it and increase their cash flow by renewing for 10 years, guaranteeing MORE revenue and paying it up front. What a joke! Am I the only person who sees this?
We are the sheep in the “industry” which is made up of 1% of decent/good names the other 99% are garbage. Sounds like some of the other geo-political happenings in our world today…The 1% 😉
Don’t believe the hype, your domain names are not nearly as valuable as registrars want you to believe and the reports are made to keep you believing, stop the madness, stop the dream and realize the powers to be pump it up to make sure you renew. There is no liquidity, there is no market its all for show and to guarantee their top line revenues, period!! We are being taken everyday, every week and every year! Unfortunately, I do not seeing it stopping and we get further away each registration from what we initially intended when we bought are first name(s)…
I completely agree with @Chuck and will let my vanity domains to drop. There is no need to keep registering them in order to protect brand.
You cited the options being:
>> 1.) Expend resources and money to
>> switch to another domain. Change all of
>> its email, set up SEO redirects, etc.
>> 2.) Pay the higher price
>> 3.) Renew now for ten years
When it comes to ICANN and registries, they say #1. You can switch to all these other “wonderful” nTLDs. However, this is not realistic. Lets say that NPR (npr.org) decides to move to a .radio. In doing so they will likely have to spend millions of dollars re-branding, reprinting business cards, changing email, technical systems, APIs and more.
But what is not said about this is they literally can not give up the .org domain for numerous reasons even after having switched domains:
A.) They likely still need old email accounts, so they will have to keep the old domain to capture those emails
B.) They likely don’t want this to go to another entity for brand protection reasons and for possibility that a new owner would abuse it
C.) They will for sure want to redirect users that type in the .org (millions of people no doubt) to their new .radio domain.
So aside from “switching costs” alone, there is STILL lock-in as they have to always pay to keep the goodwill they built on the .org over the last 3 decades.
Paying early (option 3) is not a solution either. They will need to keep this domain for the indefinite future. As option 1 is not going to happen, because they are not going to “expend resources and money to switch to another domain”, because they won’t effectively, or realistically, give up or want to give up the goodwill they already built in the domain.
So the only option that makes sense is #2 per your three options.
Charles Christopher says
>This was all ICANN.
>it doesn’t seem that this change was brought on by the registries
….. Verisign …..
Anyone that thinks that this will not affect them or that this will only affect large portfolio holders is simply an idiot. This is not how economy works.
ICANN and these registries are a fallacy in the world economy.
An increase of $10 over 10 million domains is $100 million per year! That is free money flowing from companies around the world into a US company that has no competition. This could turn into billions of dollars…
Göran Marby is a toy in the hands of these large companies. Shame on him.
See, Konstantinos? I told you I link to you from other blogs too. 😉
And I could not agree with you more, by the way.
Here in America for instance we have a system of legalized bribery. It is known as “lobbying.” All it takes is astronomically less than pennies on the dollar to buy policy makers and receive vast returns on investment in the untold billions of dollars in exchange.
This is actually one of the most pigheaded evil things ever done in the history of the world. HUGE implications for publishing, freedom of speech, suppression, censorship, ultimately human freedom itself. HUGE implications for ordinary people to have the same opportunities the already rich and powerful once had to engage in commerce and business and support themselves and their families.
This is the “beginning of the end” toward Orwellian dystopia. Toward the very real and true prophecies of Revelation.
This action is so blatantly evil (yes, e-v-i-l), blatantly stupid, and blatantly irrational, non-rational, and insane that one really has to wonder what really happened. Anything is possible. For instance, if Overstock.com could walk into the offices of ICANN some years ago and offer first $1 million, then $2 million for O.com, who’s to say some of the people in charge of the private ICANN cabal were not simply bribed with good old fashioned cash or some other enticements already?
The purported “justification” is one of the most blatantly steaming piles of “bullsh*t” I have ever seen in my life, and I just got hit up in the heart of one of the biggest cities in America by an aggressive panhandler who used a worn out old line I’ve almost never heard or seen anymore since as far back as the 1980’s or 90’s. I even wished I had advised him about that afterward and given him tips on how to do better. Rick Schwartz wrote *the* domain blog post on “bullsh*t,” and this ICANN mockery is Nobel Prize and Academy Award level bullsh*t. And see what I wrote previously over here: https://onlinedomain.com/2019/07/03/domain-name-news/ica-asks-icann-for-explanation-of-org-decision/#comment-372801.
Charles Christopher says
I think the social credit score is far worse. For most of us it is just not so obvious YET.
The comment of @Kostantinos is his own and I give him the reason.
Increasing domain name prices is great. It will primarily hurt domain squatters. Many tlds are like $10/year. Any legit user can afford to pay 10x that. Onyl squatters with big portfolios can’t and they deserve to be crushed.