Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Why I Voted to Sell .ORG

circleid.com

Post reply on HN
Print view View original

201–210 of 316 posts

Re: Why I Voted to Sell .ORG

#201

Post by zrm »

ptest1 wrote: post #107

I don’t understand how this “sale” is legal in the first place. PIR is a legal 501(c)3 nonprofit. You can’t really sell a nonprofit to a for-profit company except in unusual and rare circumstances. In California, I know you need a letter from the state Attorney General to do so. There are also federal restrictions on sales like this, particularly around self-dealing transactions. This transaction was obviously self d…

Not only that, isn't there a sense in which a TLD is not actually property at all? The DNS operates by consensus. There are a bunch of root server operators who all agree who operates the .org TLD and then list those NS records in their root servers.

What stops people from getting together, agreeing that a private equity firm would be a poor steward of the .org TLD, choosing somebody else to operate it instead, and pointing the NS records there instead?

Nobody really owns the DNS. It's a thing that works because there is a broad consensus on how it should work. If the consensus is that this is a dumb idea then what's stopping people from choosing not to go along with it?

And staging a coup over this would set a good precedent that these types of flagrant money grabs are not to be tolerated.

Re: Why I Voted to Sell .ORG

#202

Post by ben509 »

munk-a wrote: post #175
ben509 wrote: post #153

Earlier quoted context omitted.

Not all consumers are equal. Wikipedia sized organizations would easily absorb the relatively trivial cost, so, they wouldn't switch. Their demand is relatively inelastic to price. The people switching are going to be the far more numerous smaller operations, who are elastic to price. And, of course, anyone signing up for a new domain is highly elastic. Because there are lots of people who are highly elastic, the ove…

Wikipedia could absorb a trivial cost increase so it's likely that a PE firm would target them with more steep increases. From what I've read about their price increase limiting "agreement" it isn't one, it's just a statement and isn't laid out in any binding contracts. Maybe Wikipedia gets it's registration price bumped up to 3 million because the PE firm thinks the org can absorb the cost.

It can't be laid out in a binding contract because it's a new contract each time you renew the name. This is something every renter has dealt with since forever.

So, yes, they could absolutely start trying to shake down the biggest non-profit organizations. Those are also organizations that are highly sympathetic and have literally hundreds of millions of viewers, and thus immense political clout.

Re: Why I Voted to Sell .ORG

#203

Post by scandox »

zAy0LfpBZLC8mAC wrote: post #198
scandox wrote: post #161

Earlier quoted context omitted.

I agree the author seems very naive and you're right to zone in on the only substantive thing he did say. However I'm still unclear about some points. For example can they sell oxfam.org from under Oxfam's nose? How does that work?

They can't "sell it from under their nose", they just can demand any renewal price for it they like, and delete the domain if that price is not being paid.

Ok so they can arbitrarily set a unique price for a specific domain?

Re: Why I Voted to Sell .ORG

#204

Post by wwweston »

zrm wrote: post #201
ptest1 wrote: post #107

I don’t understand how this “sale” is legal in the first place. PIR is a legal 501(c)3 nonprofit. You can’t really sell a nonprofit to a for-profit company except in unusual and rare circumstances. In California, I know you need a letter from the state Attorney General to do so. There are also federal restrictions on sales like this, particularly around self-dealing transactions. This transaction was obviously self d…

Not only that, isn't there a sense in which a TLD is not actually property at all? The DNS operates by consensus. There are a bunch of root server operators who all agree who operates the .org TLD and then list those NS records in their root servers. What stops people from getting together, agreeing that a private equity firm would be a poor steward of the .org TLD, choosing somebody else to operate it instead, and p…

It’s correct enough to say that DNS is an application of consensus, but rather than considering that a distinction vs property, one might consider asking themselves in what sense property itself isn’t consensus.

Re: Why I Voted to Sell .ORG

#205

Post by jfim »

gwd wrote: post #168
tptacek wrote: post #145

Earlier quoted context omitted.

Help me understand what you mean by "worse than naive" here. Richard Barnes isn't going to see a dollar of this money and wouldn't need it anyways. I understand people disagreeing with him, but, despite being automatically disinclined to extend good faith to anything published at CircleID, I don't understand where anyone derives bad faith from this piece. I thought it was tremendously useful, if only to understand wh…

> Help me understand what you mean by "worse than naive" here. "Naive" in this context generally means they were overly trusting when there was no evidence to suggest trust was warranted. I'd interpret "worse than naive" as saying that they are actually evidence to the contrary. The logic presented is, "We need more money, so we sold it to this private equity firm. But don't worry, they're not going to try to squeeze…

Your scenarios are not mutually exclusive. To maximize their expected value, you say that they could:

1. Earn less than IS would

2. Charge more than IS would

It's actually:

1. They could earn less than IS would, because they're generous, incompetent, or some other reason

2. They could earn more than IS would, because they increase the prices, run PIR more efficiently than IS would, increase the number of registrations more than IS would, or some other reason

In scenario two, which is the most interesting, they could jack up prices, but they could also run the business better, such as running the business more efficiently or driving more business through advertising. I agree with you that the former is likelier, but not necessarily the only reason why the deal would have a positive expected value for Ethos. It could be that the deal is a win-win one, where IS gets more money than they'd be able to make out of PIR, and yet, Ethos comes ahead too by running it better than IS could.

Re: Why I Voted to Sell .ORG

#206

Post by nixgeek »

munk-a wrote: post #175
ben509 wrote: post #153

Earlier quoted context omitted.

Not all consumers are equal. Wikipedia sized organizations would easily absorb the relatively trivial cost, so, they wouldn't switch. Their demand is relatively inelastic to price. The people switching are going to be the far more numerous smaller operations, who are elastic to price. And, of course, anyone signing up for a new domain is highly elastic. Because there are lots of people who are highly elastic, the ove…

Wikipedia could absorb a trivial cost increase so it's likely that a PE firm would target them with more steep increases. From what I've read about their price increase limiting "agreement" it isn't one, it's just a statement and isn't laid out in any binding contracts. Maybe Wikipedia gets it's registration price bumped up to 3 million because the PE firm thinks the org can absorb the cost.

Why wouldn’t Wikipedia hedge against this outcome by extending their domain for 10 years tomorrow, and paying $100 to do that?

Re: Why I Voted to Sell .ORG

#207

Post by the_angry_angel »

tinus_hn wrote: post #121
the_angry_angel wrote: post #9

The simplified timeline (as I understand it, willing to be corrected if I'm wrong); 1. PIR, or someone very close, seems to have lobbied to have price restriction of .org removed. My understanding is that PIR made the argument that they're a non-profit, they have no reason to raise pricing extortionately 2. This was passed, despite a large number of comments against the idea, Ethos was incorporated the following day…

You forgot the part where Ethos is the same people who controlled PIR. It’s just a sleazy trick to take off the non profit veil, so they can start skimming the profits. Does anyone really believe the non profit PIR and ISOC couldn’t exist on their $90 million a year .org tithes?

Yeah I’d completely missed this part. Makes it even worse

Re: Why I Voted to Sell .ORG

#210

Post by techsupporter »

Thorrez wrote: post #61
Traster wrote: post #10

This author is just outright naive. >Even in the worst case, if Ethos considers dramatically increasing prices (which, to be clear, we do not expect them to do!), the Registry Agreement for .org requires a 6-month notice period during which domain owners can lock in a 10-year registration at pre-increase rates. This should seriously discourage Ethos from doing this, because it would take 10 years for the new high rat…

>This should seriously discourage Ethos from doing this, because it would take 10 years for the new high rate to even take effect for existing registrants, and new registrations would likely fall off right away. It's the exact opposite of that. As soon as you announce a price hike, you don't get a giant loss of money, you get a giant flood of money as tons of people pre-pay for 10 years.

You even kinda get the best of both worlds, a cash infusion and more money in the long run.

The org TLD has 14 million registrations in it right now. If Ethos announces a 50% price hike (increasing the base charge from $9 to $13.50), my guess is 2% of the domains would be immediately renewed for the 10-year max at the old price.

So right off the bat, Ethos have 280,000 domains * ($9 * 10 years) = $25,200,000 in new cash. Now that means they've lost out on $37,800,000 from the price hikes but that was collected over the next ten years and assumes that all of those domains would have continued for ten years. They've no choice now; the money is paid.

If Ethos lose another 10% of org registrations because people don't want to pay the increased cost, that leaves 12,348,000 domains left. Assume another 10% of those either don't renew for some other reason or renewed for more than one year but less than ten. Now you're at 11,113,200 remaining domains that, in the year after the announcement, bring in an additional $50,009,400.

So just by announcing a price hike and not-so-subtly encouraging domain owners to "take advantage to lock in today's price for years to come," Ethos bring in $75,209,400 with two-thirds of that being new recurring revenue and the remaining third suitable for distribution as bonuses to all of the executives who made such a clever scheme what it is.

Post reply on HN