ICANN to allow domain registries to charge 'what the market will bear' for domain names & renewals?

[David Farber <dave () farber net>]

Begin forwarded message:

From: Suresh Ramasubramanian <suresh () hserus net>
Date: August 29, 2006 8:59:11 PM EDT
To: dave () farber net
Cc: joe () via net
Subject: Re: [IP] ICANN to allow domain registries to charge 'what  
the market will bear' for domain names & renewals?

David Farber wrote:
> From: joe mcguckin <joe () via net>
>
> http://kenmccarthy.blogs.com/ken_mccarthy/2006/08/domain_name_mad.html

Some rather informed commentary from John Levine -
http://www.circleid.com/posts/how_much_org_biz_info_domain_costs/

How Much Do You Think a .ORG, .BIZ, or .INFO Domain Costs?
Posted by John Levine on Aug 28, 2006

Whatever you think the answer is (typically about ten bucks), the answer
is likely to change radically for the worse, based on new contracts that
ICANN is planning to approve. On July 28th ICANN posted proposed new
contracts for .ORG, .BIZ, and .INFO, for a public comment period that
ends four days from now, on the 28th. There’s a lot not to like about
these proposed contracts, but I will concentrate here on two related
particularly troublesome areas, pricing and data mining.

The current contracts all set a fixed price per domain per years for
each TLD. In .ORG it’s $6, .BIZ it’s $5.30, and .INFO it’s $5.75. The
proposed contracts keep the same prices, but let the registries change
the prices unilaterally with six months’ notice to the registrars (not
the registrants.)

George Kirikos has published a note outlining some of his concerns,
along with an astonishingly naive response from Vint Cerf to them. His
main concerns are about differentiated pricing like .TV has tried to do,
without notable success. If they crank up the prices on available
domains, that seems kind of sleazy but easy enough to work around. The
problem is renewals; there’s nothing to prevent the registries from
charging any price they want for a domain that is well known. If they
decided that the renewal price for icann.org is now $100,000, what is
ICANN going to do?

Since the agreements say that the registries have to give six months
notice to the registrars, Vint Cerf said in a message to Kirikos, that
in case of a price increase, registrants will just renew for ten years,
and lock in the price, which either will solve the problem or deter
registries from raising prices. This is unrealistically naive for
several reasons. The one that Kirikos pointed out is that ten years may
seem like a long time on the Internet, but it’s not a long time in real
life. The most well known info domain, mta.info, belongs to the New York
Metropolitan Transportation Authority which has been around since 1965
and whose predecessors go back to 1906. I suppose that in ten years they
could go look for a different domain with a less abusive registry, but
it’s hard to defend a pricing policy that makes legitimate companies
switch names every decade to avoid being shaken down. It also means that
registrants who now register a domain for a year or two and then let it
expire if the plans didn’t work out would defensively register for ten
years, just in case. This is basically protection money for the
registry, and will have the perverse effect of creating large numbers of
abandoned domains not in use by the registrants and not available to
anyone else. (No doubt the registrars will “solve” this problem by
parking click farms on them.)

A more serious problem is that although the registries have to notify
the registrars of a price change, there’s no rule that requires the
registrar to pass the news along to the ultimate victims. If the
registrar were to set its price to, say, the registry price plus 40%,
what incentive do they have to tell a customer to renew now for $9
rather than next year for $500? Anyone who says “oh, they would never do
that” must not have dealt with many registrars. It is telling that the
proposed agreements, which include a long list of required provisions in
all registry-registrar contracts, could easily say that registrars must
pass along word of a price change, but they don’t.

Danny Younger pointed out in a phone call that the proposed contracts
also specifically permit registries to sell DNS traffic information
about non-existent domains, thereby making it much easier to identify
and squat on all of the most commonly mistyped domain names. As I’ve
said elsewhere, I think it would be much more productive to persuade
Google and Overture to stop paying for clicks on pages without useful
content since typosquats are far from the only place this noxious
practice occurs, but there are probably other abuses of combined DNS
data mining and differential pricing that we haven’t figured out yet.

So I have a few suggestions to avoid the damage that differential
pricing would cause.

* The simplest, fairest, and most obvious solution is to avoid it. All
of the registries are doing well enough at the current fixed price to
want to renew, so there is no reason to change from a fixed price. An
obvious price to level the playing field is $4, what the current
agreement for .net sets. Registries are largely automated, computers
keep getting cheaper, and even the huge artificial load caused by domain
tasting and sniping (trying to grab expired domains the millisecond
after they’re released) doesn’t seem to have affected their profit
margins enough to be worth doing anything.

* If we can’t agree to be that sensible, the next least bad option would
be something like .com, all the prices are the same even though the
overall price goes up at a limited rate.

* If ICANN is determined to permit differential pricing, the worst
abuses affect registrants (such as me) who registered domains in good
faith assuming that the price we paid was pretty much the price we would
continue to pay. This suggests that once a domain is registered, the
price for that domain is fixed for all renewals and transfers until and
unless the registrant decides to abandon it.

* From a simple viewpoint of consumer protection, it is at least as
important to notify registrants of price increases. If the increase is
small, say, up to 25% over what it was the last time the registrant
registered or renewed the domain, e-mail would be OK. If the price
increase is substantial, it really needs to be something more
substantial, like a paper letter. If registries think that would be too
expensive, they could save themselves a lot of money and hassle by not
raising the price.


-------------------------------------
You are subscribed as lists-ip () insecure org
To manage your subscription, go to
 http://v2.listbox.com/member/?listname=ip

Archives at: http://www.interesting-people.org/archives/interesting-people/