Verisign will put $20 million in the kitty in return for multi-billion dollar windfall.
Last year I made a prediction in my annual predictions podcast: ICANN would let Verisign (NASDAQ: VRSN) raise prices on .com, but Verisign would pay it extra money for the right to do so.
That’s the crux of a proposed agreement between the two parties.
The agreement would allow Verisign to increase prices by 7% in each of the last four years of each six year contract renewal. This is in line with an agreement Verisign struck with the U.S. government to amend the Cooperative Agreement. The wholesale price of a .com should increase from $7.85 to $10.26 over the next four years, and registrars will add their own markup.
In a carefully worded press release, the parties noted that ICANN is not a price regulator and is deferring to the U.S. government on .com prices. Historically, ICANN has been a price regulator, but it recently abdicated this role for some reason.
Now, about that payoff. ICANN is facing a budget shortfall after growing and expanding rapidly in recent years. The correct thing to do would be to trim the fat, but the Verisign contract renewal gave ICANN an easy opportunity to incresae revenue. Verisign will pay it an addition $20 million over the next five years as part of its new agreement. Problem solved.
Given some of ICANN’s recent decisions, this should come as no surprise.
Long in the making. ICANN is just executing their plan and they couldn’t care less about domain registrants.
A “not for profit” monopoly with half a billion in the bank and most officers making over $300,000 per year.
https://www.icann.org/en/system/files/files/fy18-irs-tax-form-990-return-organization-exempt-income-tax-27may19-en.pdf
Only people who will be affected by this are domainers who make up less than 20% of all dot com domains.
Your average joe who owns less than 10 domains and makes up for 80% of all dot com domains are not going to even notice this small change of couple dollar increase.
That’s just the softening up process, watch what happens when price caps are removed ….
Will never happen in my view. US govt happy to throw other extensions under the bus but not .com, the only one that is protected. Too important and too big a monopoly.
The other 1200 gtlds (.net .org, .biz, .club) are all fighting over less than 10% of the market, while .com is 90%.
I think that the strength of .com could take more than a 7% increase.
I think the target should be a $25-35 wholesale price with those extra profits being reinvested into the organization and a select set of charity funds that can help the homeless, veterans and food pantries across the country.
It’s a win-win.
Too big to fail right?
We know how that goes.
Yep, internet currently 10% of US GDP.
My guess is more like 50% of .com domains in domainers hands. Perhaps John or others doing research on this could enlighten us, but 20% is a very low guess for this number, IMHO.
“And I saw the dead, the great and the small, standing before the throne, and books were opened; and another book was opened, which is the book of life; and the dead were judged from the things which were written in the books, according to their deeds.” (Revelation 20:12)
(Note: “which is the book of life” should read as “which is of life”; “the book” is italicized which means only added for clarity but not part of the text.)
What happens at Huge Domains 7 million domains x $2.50 = almost $20M a year off their bottom line.
Damn they should have paid ICANN $25M to leave it alone.
Was doing some seemingly unrelated research and this popped up:
http://www.circleid.com/posts/icann_tiered_pricing_tld_biz_info_org_domain/
– By George Kirikos, Aug 23, 2006 5:23 PM PST
“I finally got the “official” word from Vint Cerf of ICANN, “on the record”, who confirmed that my interpretation is correct, that differential/tiered pricing on a domain-by-domain basis would not be forbidden under the .biz/info/org proposed contracts. “
What does it mean to “incresae revenue”?
revenue is the amount of money you get by selling something. revenue – costs = profit.
Hey, domainnamewire,
If you’d like this page to be less broken on mobile (and probably ranked better in mobile searches) try fixing your css with something like…
.comment-content {
overflow-wrap: break-word;
word-wrap: break-word;
-ms-word-break: break-all;
word-break: break-all;
word-break: break-word;
-ms-hyphens: auto;
-moz-hyphens: auto;
-webkit-hyphens: auto;
hyphens: auto;
}
To prevent long words in comments (including long URLs with no hyphens) pushing content wide of the viewport.
R.I.P Mike Mann