Potential Price Extortion on Domain names

Posted: Sun Aug 27, 2006 9:31 pm

I just found out about this.
It is real. I read the documents myself before I believed it.
This has got to the the dumbest move ever by ICANN:
I posted as quickly a possible, but the deadline is MONDAY AUGUST 28 to file a comment!!!
PLease file a response protesting the mother of all bonehead ICANN decisions

Originally posted at :
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Basically ICANN is opening up a loop hole allowing various registrars the freedom of charging what they want per each domain on a per basis condition.

Let's say you get a domain called www.bobswebstuff.com and it becomes reasonably popular or perhaps very popular. When you originally buy the domain, it may have cost $8 to $25 depending on the registrar. Now that your registrar determines that your domain is worth a lot more to you, they decide to basically extort money out of you by charging a renewal fee of $10,000 per year. The domain registrar would be counting on you not wanting to lose the traffic you got to your site. ICANN's loophole could basically allow registrars to extort more money off of each site they determine has a valuable domain name.

Google.com had they not become their own registrar could have fallen victim to a registrar who might charge them $10,000,000 per year. As I said, ICANN is opening up a loophole potentially allowing extortion.

Of course, you would have to move to another registrar that wouldn't try to extort more money out of you.

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ICANN's statements in the CFIT litigation regarding pricing caps on May 26th:
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(be sure to send to all 3 email addresses for all 3 contracts, and also click the link in the email ICANN will send you to authenticate your email address, otherwise your comment doesn't get received)

Here's a comment posted at WMW thread:

This is a serious issue and the right people need to get involved

ICANN needs to get a flood of email sent to them quickly by all webmasters of this stupid decision making.

As another person puts it at WMW:
That's this coming Monday!!! [Monday 08/28/06

Webmaster, site owners, etc., really need to get the word out fast. Send emails and post in as many forums as possible about this problem.

ICANN posted at: [url]http://www.icann.org/announcements/announcement-2-28jul06.htm [/url]the following:
A public comment period will remain open until 5:00 PM PDT/California, 28 August 2006. At that time the comments will be submitted to the Board of Directors for the Board to consider at its meeting on 13 September 2006.

If you want to read more of other comments people can visit these other forum threads:

http://www.webmasterworld.com/domain_names/3059492.htm
http://www.searchengineforums.com/apps/searchengine.forums/
action::thread/forum::members-lounge/thread::1156652486/ (piece the url together in browser)

registered · Posted: Wed Aug 30, 2006 12:01 am

<bump>

Posted: Wed Aug 30, 2006 3:16 am

Money grabbing SOB's.

The sad thing is, if they get away with it, all the other Registrars will try to follow suite.

Posted: Wed Aug 30, 2006 7:47 am

Yep, if this goes through, it becomes "standard practice", and we are in deep trouble.
Wouldn't be long before Verisign jumped on the bandwagon to add this to the .com and .net agreements.
Oh well, all we can do is wait and see now.

registered · Site Admin Joined: Jun 04, 2004 Posts: 6437

Silly question: what's to stop a domain owner from transferring the registration to another registrar at a low cost, rather than pay extortion to the current registrar?

Posted: Wed Aug 30, 2006 12:35 pm

Absolutely nothing!
Hopefully even if this goes through which I think is unlikely, competition *should* keep it to a sensible level.
Luckily all my domains are registered with NOMINET via ENOM through my software and I'm currently paying about £5 per .com domain - long may it continue!!

Posted: Wed Aug 30, 2006 2:57 pm

Right. 1and1 has .com domains for about US$6. I think only the "pay whatever they ask" companies like Register.com and Network Solutions will try to get away with a stunt like this. The other competition is too tough...but that could change with acquisitions, etc.

Posted: Fri Sep 01, 2006 3:04 am

One thing everyone keeps overlooking in this is that ALL registrars pay Verisign.
Department of Commerce gave authority to ICANN who gave monopoly to Verisign.

Once this sort of "free range" loophole happens, Verisign is certain to raise rates.
It won't make any difference WHO you register with. Verisign still wants their cut.

So you transfer to a registrar who only charges you $10.
Verisign decides since some of the other registrars are getting $50-60 from big business, they should get a bigger slice and raise rates to $20.
Now your one year $10 renewal is now $40 since your registrar has to keep a profit margin.

So say 1/3 (worst case) of the "Mom and Pop" sites don'te renew. Your $10 registrar now not only has to raise rates due to Verisign, but just lost 1/3 their yearly revenue.
Who do you think will make up that loss?

Since your hosting company also lost 1/3 their customers AND their renewal was also raised, what do you think will happen to your hosting fees?

It's all moot now. We just have to wait and see if apathy has allowed this decision to pass.

Posted: Fri Sep 01, 2006 4:57 am

ICANN sets the fee, and though Verisign may want to raise rates, that, too, would have to be approved - separately.

Also, if you read it correctly, you'll note that the small sites won't be affected at all since they (presumably) don't have the traffic to justify a higher rate. Thus, neither registrar nor hosting company loses customers. And competition and technology improvements like virtualization will continue to push down those fees, too, increasing business for hosts and registrars.

The airlines learned long ago that it's better to make 85 cents on a billion reservation transactions than $10 on 1 million passengers. Banks learned they can provide "free" checking by charging service fees, especially if they scale the volume. I doubt ICANN or Verisign wants to stop that gravy train or mess with it in any way that will cause it to lose volume. This is purely an attempt to take advantage of the large traffic sites, whose price tolerance is much higher than the small sites. You can expect the big guys will fight that tooth and nail or, like Google, will become registrars themselves so they can have more control over their own destiny (again, circumvention!).