ICANN, VeriSign Limit .com Price Hikes

The Internet Corporation of Assigned Numbers and Names (ICANN), the closest thing the Internet has to a governing body, and giant registration and service provider VeriSign have posted a revised edition of their settlement agreement which, in addition to resolving their dispute over VeriSign’s Site Finder service, would limit price increases which can be imposed by VeriSign on .com domain registrations and renewals.

ICANN and VeriSign reached an tentative settlement back in October 2005, mostly concerning mutual lawsuits over VeriSign’s Site Finder service, which changed the way VeriSign resolved requests for non-existent domains in the .com and .net top-level domains. The new agreement incorporates new terms in response to feedback from the Internet community, and limits the amount of money VeriSign can charge for renewals and new registrations in the .com top-level domain.

Under the revised settlement, VeriSign would be permitted to raise the fee it charges to domain name resellers for new registrations in the .com top-level domain by as much as 7 percent a year over the next six years. However, in two of those years, VeriSign would only be permitted to raise the fee in response to a security threat or as a result of new costs stemming from an ICANN mandate. Absent those causes, the fee may only be increased by 7 percent in four of the next six years.

To understand the money involved, consider that VeriSign’s fee is currently $6 per .com domain per year. Domain resellers can charge whatever they like, usually rolling that $6 into their fee. There are currently more than 40 million .com domain names registered; assuming that number remains flat, a 7 percent fee hike would net VeriSign an extra $16.8 million in registration fees in the first year alone. If VeriSign implements 7 percent increases in four of the next six years (as it would be permitted under the settlement agreement), VeriSign would pull in an $180 million over six years. If security issues or ICANN mandates require fee hikes in each of the six years, VeriSign could collect over $1.87 billion in domain fees for .com

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