Editor’s note: this post is by Nat Cohen. I am publishing it because he provides a rich context for ICANN’s proposal to remove price restrictions on .org domain names. Any opinions in this post are those of the author.
ICANN awarded the .org registry to the Internet Society (ISOC) in 2002 with the intention that the “profits from the registry will go to ISOC” to provide a reliable source of funding for its mission. ISOC has cumulatively received hundreds of millions of dollars in funding over the intervening years from the profits of the .org registry, allowing it to grow from 8 employees and a budget of a little over $2 million in 2001 to over 100 employees and a projected 2019 budget of over $38 million, with $34 million of that generated from the .org registry.
PIR (Public Interest Registry), the organization created by ISOC to manage the .org registry, is currently operating under an agreement that limits price increases to 10% per year. ICANN staff is proposing that all price constraints be eliminated in the new .org agreement. If approved, PIR would be able, if it so chose, to sharply increase prices on .org domains with the result that revenues from .org registrants could increase by hundreds of millions of dollars annually, with much of that revenue coming out of the operational funds of non-profit organizations.
ICANN created an unusual structure in which one non-profit, ISOC, receives most of its revenue by extracting funds from other non-profits – the community of non-profits using .org domain names. It might strike some as unseemly that one non-profit that is well-connected within ICANN was able to leverage those connections to extract funds from other non-profits around the globe whose focus is elsewhere than on building relationships within ICANN.