On the removal of price caps for legacy domains


(A mirror of my public comment on ICANN’s proposed renewal of the .org registry agreement, which included a widely-protested provision to remove the 10% limit on the price increases that the registry could charge for registrations and renewals.)

Like many others who have already submitted comments on this proposal, I have grave concerns about the provision to remove the price caps on registry fees for .info and .org top level domains. (I refrain from commenting on .biz as I do not own any such domains nor do I personally frequent websites using this TLD, but my concerns are applicable there also.) I say this not only as the owner of several domains (for whom these potential price increases have a direct monetary impact), but also more generally as a user of Web sites and Internet services. There is already growing social concern about the centralization of access to information with large corporations, who increasingly mediate the average person’s experiences and interactions on the Internet. The Domain Name System provides a valuable part of the antidote to this problem: it allows individuals to set up their own corner of the Internet as they wish, largely unbeholden to anyone else; and allows anyone else to easily locate it on demand. This latter aspect is what makes pricing of domain names critical: because the domain name is the identifier used to locate a site or service, abandoning it breaks the ability for others to find it easily, and moving domain names requires rebuilding all links and trust from scratch, a long and tedious process which can never be fully completed. If a registry is allowed to raise fees in an arbitrary and unbounded manner, many of these registrants will decide that the expense is no longer worth it and abandon the registration–or even be forced to as the costs become unaffordable.

Additionally, ICANN’s justification for this change is that it will “allow the .info renewal agreement to better conform with the base registry agreement, but also takes into consideration the maturation of the domain name market and the goal of treating the Registry Operator equitably with operators of new gTLDs and other legacy gTLDs utilizing the base registry agreement.” While simplicity is an admirable goal, it seems to me that it should not serve as the primary justification for such a drastic and far-reaching change. I therefore evaluate this explanation primarily on the merits of the other two reasons given:

  • “maturation of the domain name market”: It is not clear to me what, precisely, this is intended to mean; I take it as a reference to both the relative fullness of the legacy TLD namespace (as most common words and phrases have already been registered), and to the availability of new gTLDs. Presumably ICANN is worried about domain name squatters, and hopes that the rising prices will reduce the incentives to hold unused domain names for future profit, and believes that competition with new gTLDs will keep the prices of legacy TLD domains will keep prices to a reasonable level. I fear that this may be a cure worse than the disease: as I argue above, raising prices will also affect many domain owners who are putting their domain registrations to constructive uses, and for these registrants it is not practical to promote competition by changing TLD as this has a significant impact on those operations.

  • “the goal of treating the Registry Operator equitably with operators of new gTLDs and other legacy gTLDs utilizing the base registry agreement”: Setting aside the legacy gTLDs using the base agreement (of which I am unable to find a list, which makes it difficult to do any research), I will discuss only the comparison with new gTLDs. This argument is couched in terms of equality, but doing so conflates the two and masks the fundamental differences between the two. The new gTLDs were introduced as “green-field” namespaces, fully controlled (modulo the agreement with ICANN) by the purchasing registry and with no existing users. Since they had purchased these TLDs at their own expense and risking their own resources, the registries of these new TLDs were not subject to similar price caps and could thus set prices as they wished. While registrants of new gTLDs incurred a risk of uncapped price increases, this possibility was known when they initially purchased the domain, and they presumably accepted the possibility of price changes when making the initial decision to register under that TLD. In contrast, the legacy gTLDs have many long-time users, in some cases dating back to before the creation of ICANN, and so when management of them was contracted out a price cap was specified to protect these existing users. To allow these prices to be raised now would disproportionately impact these users, who put their faith in the DNS’s continued stability long before such a move as this could have been forseen.

In summary, this proposal is in direct contradiction to ICANN’s stated purpose, “management of the DNS in a manner that will permit market mechanisms to support competition and consumer choice in the technical management of the DNS,” intended to “lower costs, promote innovation, and enhance user choice and satisfaction.” If put into effect, it will have precisely the opposite effect, raising costs, promoting entrenched organizations, and reducing user satisfaction. In light of this, and considering the public outcry about this matter both in the public comments section and elsewhere on the Internet, I strongly encourage ICANN to reconsider not only this proposal but also the decisions that led to it being suggested in the first place. ICANN should return to its original intent as a group for coordinating operation of the Internet and representing the global user community.