I really hope this won’t be a trend for gTLDs. This highlights how big the risk is when you build your business on an unproven gTLD. I just moved my own website to a .blog domain. Hopefully, for me, Automattic will keep the prices of .blog reasonable.

It is very important to maintain perspective on this news. While it is a very poor business practice to subject registrants to unexpected fee hikes, the tld’s affected are under-performing ones and have a relatively small user base.

Many of the new tld’s are self-sustaining, profitable, and growing. There are unjustified critics of the new tld program who are rooting for its demise because they have a vested financial interest in legacy tld’s like .com. Many of these people have large, costly portfolios of .com’s that will never sell. Consequently, they are out today like chicken little proclaiming the sky is falling. It’s not.

Uniregistry’s renewal increase on a small group of unpopular tld’s is not indicative of the future of all tld’s. Some web addresses simply have better viability.

.COOP has less than 8000 registrations at ~$120 for one year and $85 for 10 years. I don’t recall ever having heard news about them struggling or needing large price increases to survive. From what I have seen there are many such TLDs including ccTLDs.

I also fail to see how raising the price will suddenly make a TLD “successful”. It does make sense that there is a desire to shift income onto a TLDs most desirable strings and see what the market will bare. I would be interested in a definition of “low volume TLD”, what is the threshold? Such a number would provide better comparison to the .COOP example. I suppose if a gTLD has perhaps only a dozen registrations it would appear it might be a pseudo bTLD (brand) and thus being “leased” as such. Perhaps a new “class” of TLDs is being teased out by this first round of nTLDs.

I make those points because I see .COM prices increasing, and I am concerned over the reasons Verisign will use to justify the increases ....

I had to both chuckle and frown at the “headline” of this article in my weekly CircleID e-mail newsletter as this move is both incredibly short-sighted and backward looking.

This will actually have the opposite intended effect by forcing people into less expensive, over-populated gTLD strings and just “giving up” on having a more desirable domain name.

A better strategy would be to see consolidation through mergers and acquisitions within the registry operator space so build greater scale and overall cost of service per gTLD. Donuts has the right model but poor implementation - their cost per domain name is too high and they have, arguably, the most under-penetrated of new gTLD strings. Using their “lean” business model, if they were to dramatically lower their pricing across the board, they would likely see a significant uptick in registrations and the higher penetration strings would effectively subsidize the lower penetration ones until, over time, they inevitable pick up.

Another strategy, which could also be used in concert with M&A;in the space, would be to the outsourcing of the back-end registry administration and technical operation with a few “lean” players (i.e., Afilias, VeriSign and NeuStar, among others). Alternatively, if they have too much of a “monopoly” in these third-party administration services, ICANN could look to regulate the price they can charge for back-end registry administration services, adjusted biennially with the global Consumer Price Index as determined by OECD or IMF and allow for significant public comment, surveys and outreach in any request for a price increase.

I realize that’s a bit counter to the “free market” but, I’d argue, the domain name space is anything BUT a “free and open market.”

The problem we have is these registry operators are backed by private equity firms and venture capitalists in many cases, who seek a “quick” ROI. In the case of Uniregistry, where I’m a happy customer of their Uniregistrar domain registrar business, I’m wondering if Schilling has seen a decrease in the value of his owned & third-party domain resales business as a result of the new gTLDs, which he was, perhaps, counting on to partially subsidize his Uniregistry business initially until it built scale? :(

Another problem we have:  large, low-cost registry operators/registrars have been demonstrably slow at rolling out their delegated new gTLDs, such as Amazon and Google, despite their assurances to ICANN to the contrary. ICANN needs to “grow a pair,” if you will, and demand they roll out the public launches of their other promised and delegated gTLDs within the next 12 months or they should threaten to pull their registry agreement and transfer it to another operator who will. Similarly, Google continuously refuses to roll out the global launch of its Google Domains registrar business. :(

Cheers,
Doug

>don’t you think if the prices went up from $10 to $80-90 (or whatever it is),
>that would increase the cost for large domain name portfolio owners that
>would make really “low value” names significantly unprofitable

First, I am a domainer. So I have to be honest with myself and what the internet is actually about.

You are correct, prices increases would injure domineers like myself.

But the fact is, the internet and domain names were not created for domaineers, nor for domaineers to profit. This is a reality most domainers are not willing to admit, even to themselves. And on a price increase I will do my best to renew out my best domains for the full 10 years.

To date domainers have been the unpaid sales force of registries, this is a fact registries refuse to admit publicly, but their actions make clear they know this has been the case.

The gap/arbitrage that domainers have been working in is closing. This is why Frank moved one dot to the right. This is why registries are using variable pricing versus fixed, and why I argue everybody better pucker up because Verisign will be doing this to ...

So the right question is, what happens to those domains when domainers are not willing to hold them? Probably many will go to small business and hobbyists. And thus why is that use ignored? In fact isn’t that precisely the justification of the nTLDs to begin with? Get “decent” domains to more “End Users”?

That all said, there will always be domainers, someone who recognizes value where most others do not. But those are not the people that bring real value to the internet ... Which is also why most domineers I know also are involved in one way or another with trying to develop some of their domains.

>I do agree with you that MANY domain names, especially .COM names
>and also .NET names, are, as you put it, “computer barf,”

MOST :) And I admit, I never believed this until I sat down and went through the list. It makes no sense at all, and when you actually look at the zone file it still makes no sense.

But once you eye ball the zone file you have to stop deceiving yourself, most are garbage.

I will add that I have been watching zone files since 2001 and I do have many reasons to believe registries PAD their zone files ... That is another story, but if we see prices go up and regs count seem to stay higher than expected, remember what I just said ...

Good points - and I agree with you prices will inevitably go up but I still don’t necessarily agree that VeriSign will raise wholesale COM/NET prices, in percentage terms, as the newer gTLD registry operators. They may be a “puppet” for ICANN or, more darkly, ICANN may be a “puppet” for VeriSign but if ICANN started seeing 100, 50 or even 20 percent annual or biennial price increases, I think that’d make them take a “second look” at at least the possibility of a transition away from VeriSign and the logistics required. :)

You did “bait” me with one intriguing end point…What do you mean by “PAD” their zone files? They add names that are actually still “available/unregistered” or the registries “purchase” names for themselves?