VeriSign Monopoly To Increase .Com and .Net Fees
VeriSign, the monopoly registry responsible for .com and .net domain names, announced that effective Oct. 15, 2007, registry fees for .com and .net domains will increase as follows:
- .com domains: from $6.00 to $6.42 (+7%)
- .net domains: from $3.50 to $3.85 (+10%)
The "registry fee" is the fee that domain registrars such as Network Solutions and GoDaddy have to pay to VeriSign for each .com or .net domain registered by their clients. To make money, the registrars add their own mark-ups to that fee when charging their customers.
VeriSign's permission to increase .com fees by 7% per year is one of the benefits granted to the company by ICANN as part of a settlement the two parties reached in 2006. VeriSign had earlier sued ICANN over the latter's condemnation of SiteFinder, a controversial VeriSign service that redirected all non-existent domains to advertising pages.
From the .com registry agreement signed on March 1, 2006:
Maximum Price. The Maximum Price for Registry Services subject to this Paragraph 7.3 shall be as follows:
(i) from the Effective Date through 31 December 2006, US$6.00;
(ii) for each calendar year beginning with 1 January 2007, the smaller of the preceding year's Maximum Price or the highest price charged during the preceding year, multiplied by 1.07; provided, however, that such increases shall only be permitted in four years of any six year term of the Agreement. In any year, however, where a price increase does not occur, Registry Operator shall be entitled to increase the Maximum Price by an amount sufficient to cover any additional incremental costs incurred during the term of the Agreement due to the imposition of any new Consensus Policy or documented extraordinary expense resulting from an attack or threat of attack on the Security or Stability of the DNS, not to exceed the smaller of the preceding year's Maximum Price or the highest price charged during the preceding year, multiplied by 1.07.
In other words: In up to four of the six years from 2007 to 2012, VeriSign can increase the .com registry fee by 7% each. They can also do so in the remaining two years provided that they can document additional exenses from an "attack or threat of attack on the Security or Stability of the DNS".
Considering that each annual price increase means an additional $23+ million in profits for VeriSign, it comes at no surprise that 71% of the company's official press release talks of the increase in DNS volume and the threats of cyber attacks, while only 29% is dedicated to announcing the actual price increase.
What about .net?
The higher .net prices are in line with the new .net registry agreement signed between ICANN and VeriSign on July 1, 2005, after VeriSign had won a disputed bidding process against four competitors (CORE++, Denic, Sentan and Afilias) to retain control of the .net registry:
Pricing. From 1 July 2005 through 31 December 2006, the price to ICANN-accredited registrars for new and renewal domain name registrations and for transferring a domain name registration from one ICANN-accredited registrar to another, shall not exceed a total fee of US$4.25, which fee consists of (A) a Registry Operator service fee (“Service Fee”) equal to US$3.50, and (B) an ICANN fee equal to US$0.75. On 1 January 2007, the controls on Registry Operator’s pricing set forth in this Section 7.3(a) shall be eliminated. Commencing on 1 January 2007, the Service Fee charged during a calendar year for each annual increment of a new and renewal domain name registration and for transferring a domain name registration from one ICANN-accredited registrar to another, shall not exceed the highest Service Fee charged during the preceding calendar year multiplied by 1.10. The same Service Fee shall be charged to all ICANN-accredited registrars. Volume discounts and marketing support and incentive programs may be made if the same opportunities to qualify for those discounts and marketing support and incentive programs is available to all ICANN-accredited registrars.
In most cases, monopolies are disadvantageous for anyone but the monopoly holder and his cronies. With proper coordination among domain registrars and domain owners the .com and .net monopolies could eventually fall. But is this something worth getting worked up over? Are there more serious issues facing domain owners than registry-level price increases that are in line with real inflation rates?
[...] Daily Domainer has the details on VeriSign's pricing agreement with ICANN that allows them to institute these increases, along with up to three more such increases over the next six years — or maybe even more, if they can document enough expenses resulting from security attacks. [...]
that is really disgusting. Where all things make less their prices for more customer services, & here they add more money in domain name price, only for more earning. really disgusting.
The real problem with the price , is the exponential nature of them, and the waterfall or cascade with other tlds.
I am branding now other sites focused in the .net. some for moniker, some for the .com is registered for someone is not using.
At large place, the problem be reflected in the final user of the domains, but really .com for commercial not do much sense. As a Command line user in dos or Unix, i find myself trying use mydomain.exe et al, i think the more intuitive name or travel extension have a sense, but are not easily recognized.
And… as a non USA resident for some of us the increment is more bad.
If we are USA people Maybe is time for making a subsidiary and buy in advance al the .com registrations possible, and save in taxes. The real problem, much people not see, is accumulaive> Using rounded numbers can see better the 7% factor
Now at 6 each
10 domains 1 year=60
10 domains 10 year=600
At progressive, in ten years be 11.03 USD
10 domains 1 year = 60 if you BIN
10 domains 10 year = 1103 !!
*sigh*
I have always been against monopolies of any form.
Regardless of price, there really should be more then one company that can "give out" domains.
alas…
domains shouldnot be for 1 company
i think anything in the world should not be for one organization
that sucks
makes people roped with that company and do what it says
but i think everything is getting better than in the world and that will disappear soon
i hope so
Ridicolous… They can do everything they want, and we can't do anything about it.. 7 % sounds not that much, but for guys that registers 100+ domains it really means something. This is really bad.
Wait, I thought Verisign bought NSI? Oh they did, but I see now that they sold NSI for the crazy low price (IMO) of $100M? I think it would be VERY interesting to see who now owns NSI and what connections (if any) they have to Verisign. Why sell off a cash cow like NSI?
$100 for NSI seems like a bargain to me, so why do it? Perhaps to be in a position so that they CAN raise the fees, and not have an "unfair" advantage by also owning a registar that sells domains. I think that's it. Verisign sells of the registrar business, but keeps the rights to turn the domain valve on and off. Gee, maybe we should have let them have SiteFinder after all, since that wouldn't have COST us anything…??? Yes, revenge is sweet…
By the way I was going to renew a domain for a client and discovered that NSI's one year price was $30! They do offer a discount for multuple years, but it's STILL too much, so we are transfering all the domains away.
I hate Verisign for what they've done in the past, tried to do in the past (SiteFinder), and what they are doing now. So don't use NSI and don't use Verisign. Complain to ICANN. Just do something or don't complain.
Why ARE gas prices going up AGAIN…? Seems like we have enough for everyone to get what they need, it just costs more…
[...] suit to the recently announced wholesale price increase for .com and .net domains, the wholesale fees for .info and .org domains are going up 2.5 percent [...]
[...] on the recently announced wholesale price increase for .com and .net domains, Auerbach estimates that VeriSign spends only about $0.03 per domain name in actual maintenance [...]
As Clajus Says, it's not too much for someone who gets 1 or 2 domains, but yes for those (like me) who get 100+ domains. What i must say Clajus it's that this is a Industry (like any other), and domains are our main tool. Good Luck.
[...] Domains Go Up In Price on the 15th Posted on October 1st, 2007 by Terry VeriSign Monopoly To Increase .Com and .Net Fees VeriSign, the monopoly registry responsible for .com and .net domain names, announced that [...]
Ridicolous… They can do everything they want, and we can't do anything about it.. 7 % sounds not that much, but for guys that registers 100+ domains it really means something. This is really bad.
Of course it needs to be criticized, we should not take 7% as a one time raise but as a start of raising prices with a trick.
The domains prices are rising like oil prices.