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Verisign will increase the .com price from $7.85 to $8.39

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Re: Verisign will increase the .com price from $7.85 to $8.39

#61

Post by Aperocky »

mbesto wrote: post #54
tryptophan wrote: post #19

Please note that Verisign has a profit margin of 50%. Ie, 50% of their revenue becomes pure profit. This is an insane level. Apple is at 23%. Facebook at 35%. Profit margins that high only come from rent seeking backed by the full force of the law.

How do you decide what profit margin is acceptable? Is it okay for a company to have 3%? 76%?

It's fine with 3%, 76% or 1000%, as long as competition is allowed.

I don't see that for Verisign, they're just rent seeking off domain. Their profit should probably be capped AT&T style back in their monopoly days with heavy regulation.

Re: Verisign will increase the .com price from $7.85 to $8.39

#62

Post by amichal »

nrmitchi wrote: post #14
amichal wrote: post #7

Devil's advocate.... what percentage of .com registrations are parked/squatted domains looking for a sucker to buy at huge markups from the registrar price? I'd be very happy if this made the math on squatting a little less desirable. Edit: Don't get me wrong. If the reported profit margins at Verisign are correct they are clearly continuing to exploit their privileged market position unreasonably

I'm not sure if a 10% increase on registration price is going to materially change the math on squatting. My understanding is that squatting is like the VC game; you expect many of them to be complete losses, with a couple giving outsized returns. If you want to address squatting, then address squatting. If you want to address people squatting on new domains (as if there are many squat-able .com's left), then change…

Yeah... my intuition was/is it wouldn't make a big dent, but an interesting thought experiment.

That said. I think the small renewals are the part that makes holding onto these domains for years possible...

Random example. 20 years ago I had a one person local IT consulting side-gig. The domain was a not very useful, active less than a year and grabbed by a speculator as expected when I let it expire. It's been parked many places for years by various folks, current parking pages quote says they might be able get it for me for $120 [1] -- I could care less but if someone with less tech experience wanted it for their new small business they would likely bite.

Is there a economic mechanism you recommend to prevent this sort of thing?

[1]https://www.godaddy.com/domainsearch/find?isc=GPPTCOM&utm_so...

Re: Verisign will increase the .com price from $7.85 to $8.39

#63

Post by dec0dedab0de »

hetspookjee wrote: post #34

Why does the world allow the USA govern the domain space at all? Some months ago the USA seized the domains used by Iran's IRGC, in addition the .org was almost up for grabs a while back, and now a sudden pricehike of the .com tld. Obviously the internet has grown way beyond the powers of a relatively tiny non-profit that is ICANN so why not upgrade it into something more proper that is governed worldwide.

Anyone can use any DNS servers they want. These ones are run by the US Government because the US Government created them.

It would be almost trivial for a country, or group of countries to set up their own root servers and mandate that operating system vendors include them if they want to continue selling in their country. Then if there was something hosted on their servers everyone wanted to get to, it would spread outside of those countries by demand.

...But it isn't even necessary now with all the extra TLDs. If a government or organization wants to start a non profit TLD that just charges the bare minimum, they can do it without fragmenting themselves.

edit: In about 2004 a group of friends and I ran our own servers with SOAs for our own TLDs that we replicated to each other. It had a total of 3 useless websites, and 5 users, and only lasted a few months, but it was neat.

Re: Verisign will increase the .com price from $7.85 to $8.39

#64

Post by RKearney »

ted0 wrote: post #38

Only upvoting this for visibility. This decision hurts the consumer/registrant in the end, making future registrations and renewal costs less accessible to a lot of markets. For clarity, this $8.39 amount will become the wholesale cost to the registrar — we of course need to markup on top of that to cover our processing costs, overhead to offer great support, mitigate abuse, etc. Registrars do the heavy lifting in de…

> we of course need to markup on top of that to cover our processing costs, overhead to offer great support, mitigate abuse, etc

Why "of course"? Cloudflare is able to provide domains transfers and renewals at wholesale rates.

Re: Verisign will increase the .com price from $7.85 to $8.39

#65

Post by minikites »

k33n wrote: post #37
minikites wrote: post #30

Earlier quoted context omitted.

Exactly. Capitalism stifles innovation by taking resources from society and concentrating them into the hands of a few. If society was more equitable and if social safety nets were larger, we would see more people taking chances and innovating. Instead we have a society where people work under the duress of losing food and shelter, not exactly the best way to drive creativity.

- Sent from my iPhone

Are you saying that I'm not allowed to suggest improvements to society if I participate in society?

Re: Verisign will increase the .com price from $7.85 to $8.39

#66

Post by ted0 »

rovr138 wrote: post #49
ted0 wrote: post #38

Only upvoting this for visibility. This decision hurts the consumer/registrant in the end, making future registrations and renewal costs less accessible to a lot of markets. For clarity, this $8.39 amount will become the wholesale cost to the registrar — we of course need to markup on top of that to cover our processing costs, overhead to offer great support, mitigate abuse, etc. Registrars do the heavy lifting in de…

Since you’re closer to this and this has been asked in other comments, Is there a reason for doing this besides ‘we can’? Not sure if there’s something we aren’t seeing or aren’t privy to.

In the end, it's under ICANN's purview and in this case, also allowed by a decision made by the Trump administration in 2018. Verisign has a Cooperative Agreement with the US Government. The gist:

"The amendment repeals Obama-era price controls and provides Verisign the pricing flexibility to change its .com Registry Agreement with ICANN to increase wholesale .com prices. Specifically, the flexibility permits Verisign to pursue with ICANN an up to 7 percent increase in the prices for .com domain names, in each of the last four years of the six-year term of the .com Registry Agreement. The changes also affirm that Verisign may not vertically integrate or operate as a registrar in the .com top level domain."

Re: Verisign will increase the .com price from $7.85 to $8.39

#67

Post by qeternity »

RKearney wrote: post #64
ted0 wrote: post #38

Only upvoting this for visibility. This decision hurts the consumer/registrant in the end, making future registrations and renewal costs less accessible to a lot of markets. For clarity, this $8.39 amount will become the wholesale cost to the registrar — we of course need to markup on top of that to cover our processing costs, overhead to offer great support, mitigate abuse, etc. Registrars do the heavy lifting in de…

> we of course need to markup on top of that to cover our processing costs, overhead to offer great support, mitigate abuse, etc Why "of course"? Cloudflare is able to provide domains transfers and renewals at wholesale rates.

Loss leader.

The markup from legacy registrars is probably excessive, but with Google, Cloudflare, etc getting into the game, they can likely offer wholesale pricing to support the rest of their (very) profitable product lines.

Re: Verisign will increase the .com price from $7.85 to $8.39

#68

Post by polyterative »

shadilay wrote: post #42
tryptophan wrote: post #19

Please note that Verisign has a profit margin of 50%. Ie, 50% of their revenue becomes pure profit. This is an insane level. Apple is at 23%. Facebook at 35%. Profit margins that high only come from rent seeking backed by the full force of the law.

Profit is after expenses so they are incentivized to pay themselves ridiculous salaries to appear less profitable.

wow

Re: Verisign will increase the .com price from $7.85 to $8.39

#69

Post by ted0 »

RKearney wrote: post #64
ted0 wrote: post #38

Only upvoting this for visibility. This decision hurts the consumer/registrant in the end, making future registrations and renewal costs less accessible to a lot of markets. For clarity, this $8.39 amount will become the wholesale cost to the registrar — we of course need to markup on top of that to cover our processing costs, overhead to offer great support, mitigate abuse, etc. Registrars do the heavy lifting in de…

> we of course need to markup on top of that to cover our processing costs, overhead to offer great support, mitigate abuse, etc Why "of course"? Cloudflare is able to provide domains transfers and renewals at wholesale rates.

Domain name registration is not their core business and their feature set is limited, as is their direct support for a lot of TLDs. It works well for a lot of people, which is fine but it is likely a loss-leader for them and treated as a user-acquisition channel.

Re: Verisign will increase the .com price from $7.85 to $8.39

#70

Post by rovr138 »

ted0 wrote: post #66
rovr138 wrote: post #49

Earlier quoted context omitted.

Since you’re closer to this and this has been asked in other comments, Is there a reason for doing this besides ‘we can’? Not sure if there’s something we aren’t seeing or aren’t privy to.

In the end, it's under ICANN's purview and in this case, also allowed by a decision made by the Trump administration in 2018. Verisign has a Cooperative Agreement with the US Government. The gist: "The amendment repeals Obama-era price controls and provides Verisign the pricing flexibility to change its .com Registry Agreement with ICANN to increase wholesale .com prices. Specifically, the flexibility permits Verisig…

Thank you Ted.

I wanted to also mention that I appreciate what you and everyone at Namecheap do and the transparency when fighting things.

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