[Infowarrior] - VeriSign ups cost of .com, .net domains second year in a row

[Richard Forno]

VeriSign ups cost of .com, .net domains second year in a row

By David Chartier | Published: March 28, 2008 - 02:00PM CT

http://arstechnica.com/news.ars/post/20080328-verisign-ups-cost-of-com-net-d
omains-second-year-in-a-row.html

Exercising its contractual right to raise prices, VeriSign is once again
increasing the base registration fees for .com and .net domain names. It's
the second increase in as many years since the company extended its control
of those two TLDs in 2006.

Currently, registrars pay VeriSign $6.42 per .com domain and $3.85 for .net
domains. Come October, those prices will increase to $6.86 and $4.23,
respectively. Those price hikes are the maximum 7 percent allowable (to the
penny) under VeriSign's contract (which runs through 2012) with ICANN.
Chances are, registrars will pass the price increase on to customers.

In a press release justifying the higher prices, VeriSign cited increases in
the amount of traffic and cyber attacks on the global TLD infrastructure it
is responsible for. The company says it is boosting infrastructure capacity
ten-fold by 2010 via its Project Titan, as well as increasing DNS capacity
from 400 billion daily queries to over four trillion, even though it
currently only processes a peak of 33 billion queries per day under current
conditions.

It also helps that the ICANN has given VeriSign a monopoly over the .com and
.net TLDs, allowing the company to jack prices up each year. At least ICANN
had the foresight to mandate a 7 percent annual cap on increases, putting a
limit on the amount of pain VeriSign can inflict on registrars each year.
Assuming that VeriSign continues the 7 percent rise each year (which seems
reasonable given the company's history), registrars will be looking at $9.00
for .com domains by the time the current contract ends in 2012‹a 50 percent
increase in six years.

Per the agreement ICANN made with VeriSign in 2006, VeriSign is required to
provide notice of rate hikes in registration costs at least six months in
advance, so the pain won't be felt by registrars for a few more months.
Those registrars have not been happy about the ICANN-VeriSign pact, with
Network Solutions calling it a "de facto perpetual monopoly." VeriSign sure
is acting like one.