Tiered Pricing Coming to Top-level Domain Names?
Imagine, you've built a great website, and are on top of the world due to all the incoming visitors and sales revenues. Your competitors envy you, as do your neighbors. Your online brand has become very valuable, and when people think of widgets, the first website that comes to mind is your site. Life is good.

You open the mail, though, and see a renewal notice for your domain name that is $75,000/yr, instead of the $10/yr that you were used to. You call up your registrar, thinking "this must be a typo."
. . . for example, the renewal fee for Business.biz could be raised to $100,000/yr, for movies.info $25,000/yr, for Google.org $1,000,000/yr, and so on — whatever would maximize the profits of registries.
But, instead, you are told, "due to the success and high value you are receiving from your domain, the renewal fee really is $75,000/yr."

Sounds impossible and outlandish? Not so, if proposed new top-level domain contracts are approved by ICANN.

With parallels to the network neutrality debate, ICANN is set to approve new registry agreements for .biz, .info and .org that do not forbid differential/tiered pricing on a domain-by-domain basis. The public comment period ended on Monday August 28, 2006.

When ICANN's Board approved a highly controversial new .com agreement with VeriSign earlier in 2006 (which thankfully the Department of Commerce has yet to approve) as settlement for the SiteFinder lawsuit, other registries wanted to get the same spoils that VeriSign received, including presumptive renewal and the ability to raise domain prices. VeriSign's price increases for .com would be capped at 7% per year, though. These new proposed contracts leapfrog VeriSign, and shockingly propose to remove all pricing caps entirely. The only protection existing domain registrants would have is the 6-month notice period, and the ability to renew their domains at the old price for up to 10 years from the present.

A loophole in the contract, which ICANN has confirmed exists would go even further and create an ominous scenario, though. It would not forbid registries from charging different renewal or registration prices on a tiered/differential domain-by-domain basis. This would be comparable to the .TV registry pricing model. Thus, for example, the renewal fee for Business.biz could be raised to $100,000/yr, for movies.info $25,000/yr, for Google.org $1 million/yr, and so on — whatever would maximize the profits of registries.

Registries have seen what DSL and cable companies are trying to do, to break network neutrality and charge discriminatory prices to maximize their profits at the expense of website operators (for example, charge higher rates to Google or Yahoo or Microsoft, for access to their subscriber base, knowing that Google, Yahoo and Microsoft are very profitable). Registries are very shrewd, and these new contracts would not forbid them from discriminatory pricing to emulate what ISPs would like to do.

If these flawed contracts are approved for .biz, .info, and .org, it would not be a huge leap to think that VeriSign might take advantage of the precedent, and attempt to achieve the same pricing power for .com and .net through future contractual negotiations with an ICANN that has routinely failed to protect domain registrants' interests.

Network Solutions CEO Champ Mitchell said that the .com deal "shocks the conscience." These new contracts are infinitely worse, and create dangerous new precedents. Read over the contracts and public comments yourself, and then tell ICANN whether these new changes are acceptable to you. The deadline for comments was Monday, August 28, 2006.

Author: George Kirikos
Author's Link: Kirikos.com
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