If Ethos raises .org prices by 10% a year, the wholesale cost quickly rises.
With 10%-per-year increases, the price of .org domains begins to look like a hockey stick.
Ethos Capital, the private equity company that is trying to acquire Public Interest Registry and the .org registry, says it plans to raise .org prices, on average, up to 10% per year:
That said, Ethos Capital has stated that it plans to live within the spirit of historic practice when it comes to .ORG pricing. This means, potentially, that any annual price increase could be no more than 10 percent on average — which today would equate to approximately $1 per year.
This 10% number is based on the cap in the 2006 agreement between ICANN and Public Interest Registry (PIR). The 2006 agreement allowed PIR to raise prices 10% per year starting in 2007.
But PIR rarely increased prices, let alone by 10%. Matt Riggott examined PIR’s price increases since the 2007 contract and found that there have been 7 price increases over those 13 years. Three of these price increases were 10%, and the other four were less.
The net-net is that prices have increased from $6.00 to $9.93 from 2007 to now. That’s a 4%-on-average increase. (Riggott calculates closer to 3%, but he uses the years prior to 2007 in which prices were capped at $6.00.)
Had PIR increased its prices by 10% a year starting in 2007, wholesale .org prices would currently be $20.71, more than twice the current cost.
What happens if Ethos raises prices by 10% per year? The magic of compounding makes .org prices look like a hockey stick.
As you can see in the chart above, the wholesale price of a .org would increase from $9.93 today to $28.33 in 2030. By 2040, you can expect to pay $73.48 plus your registrar’s markup.
This assumes 10% increases, but ICANN removed all price caps last year. So the sky is really the limit.
A domain investor’s journey is often filled with ups and downs. On today’s show, you’ll hear Nikul Sanghvi’s story. He was selling vinyl records online and living with his parents when he got bogged down by carrying so much physical inventory. He started investing in domain names in 2009 and didn’t have much success at first. Then, in 2015, he got his big break: a six figure sale that helped him buy a new home for his family and start getting serious about domain names. It’s a great story with many lessons for domain investors.
ICANN and Public Interest Registry have mutually 
