
If ICANN only charges 18¢ per domain name, why am I paying $10? (2014) - rms_returns
https://webmasters.stackexchange.com/q/61467/35488
======
thedevil
An idea I've been tossing around: What if domains cost $100 if more than one
person wants it? The idea here is to squeeze the squatters with 000s of
domains.

Whenever I want a domain, most of the ones I want are taken. Not by people who
are making use of it, but by people who are squatting in hopes of extorting
anyone who would actually use the domain to produce value.

I'd actually be happy if Verisign or any other private company or any
government extracted such an unfair price for useful domains because it would
free up so many more useful domains for use.

Edit: I'd love to hear good arguments against this, I'm partly throwing this
out there to see others thoughts.

~~~
kt9
The best way to eliminate domain squatting is to make domains non-
transferrable. If you own a domain you shouldn't be able to transfer it to
anyone. The only way to "transfer" a domain should be to return it to the
domain registry where it may be purchased by any interested party at market
price determined by auction.

However this probably isn't going to change.

~~~
roywiggins
What if I register a domain with a shell corp and a straw "contact" who is an
employee of Mossack Fonseca (or whatever)? If I want to transfer the domain I
just sell the shell corp.

~~~
MichaelBurge
Then you have to pay an extra $50 or $100 a year to maintain your corporation
per domain, which reduces the number of domains you can own with a fixed
amount of expenses.

~~~
zAy0LfpBZLC8mAC
No, that would just cause a new form of corporation to arise in some
jurisdiction that costs a dollar per year to maintain, that's limited to
owning a single domain name.

------
stymaar
Laurent Chemla, the founder of gandi.net, a French registrar wrote a book [1]
on this topic, describing himself as a «thief» for selling stuff that have no
cost in the first place (domain names).

[1] confession d'un voleur (confession of a thief) : [http://www.confessions-
voleur.net/confessions/](http://www.confessions-voleur.net/confessions/) (in
French)

------
ajosh
I don't claim to know what the fair price for the .com registry. I will say
this though the hosting isn't free. There are millions of requests per second
across all networks from all across the world. They must respond with low
latency. The major registries are nearly always under DDoS attack. There is a
reason verisign has some of the best DDoS protection.

All the data centers across the world, the network connectivity, the DDoS
hardware, servers, custom software and staff to run it all must be expensive.

~~~
hk__2
> All the data centers across the world, the network connectivity, the DDoS
> hardware, servers, custom software and staff to run it all must be
> expensive.

We’re just talking about the DNS part here; not the hosting. Maintaining a
bunch of DNS servers doesn’t cost $9 per domain.

~~~
wmf
Somebody put in a proposal to run the .org registry at cost for $2/domain/year
a while back, but it was rejected because their infrastructure was only
something like triple-redundant Postgres instead of quintuple-redundant
Oracle. This is known as a "beauty contest"; ICANN picks whoever has the most
over-engineered solution and when you cross that with "cost plus" thinking
leftover from the military-industrial complex you end up paying $9.

~~~
anarazel
.org runs on postgres.

------
kukx
Ignoring the fact that the revenue goes to a private company there's one good
reason why 18¢ would be a bad idea - already too many domains are hoarded by a
small group just for resell; I imagine it would be even worse then.

~~~
gruez
The solution to this should be simple. Every n years, domains are put up for
auction. To keep the domain, the original owner must pay x% of the top bid,
otherwise the top bidder acquires the domain for his bid price, maybe add a
year or two of grace period so the original owner can migrate.

~~~
inputjoker
That is the stupidest idea ever. If i have a domain name and if somebody rich
wants it, it can take over next year. It hijacking.

~~~
brador
How about if that additional revenue from the sale goes to you?

~~~
zAy0LfpBZLC8mAC
What if we did the same with names in general? If someone wanted to be brador
on HN, and you didn't out-bid them, they were to get your name. Oh, and your
real name, too, of course. If someone pays enough, you have to get a new name.
And a new telephone number. And a new house. And anything else you own,
really. If someone offers more money than you have, you are forced to sell at
that price whatever you have. What could possibly go wrong?

~~~
brador
So long as i get say 90% of what the final buy price is and I get to bid on my
own things too? Yeah that would actually be awesome.

~~~
zAy0LfpBZLC8mAC
You do realize that anyone who had more money than you could take away
everything you have with no recourse? One simple strategy would be to force-
buy from you your bed and all your food at a price a little above the market
price. Now, you can either accept the offer and thus get paid only about 90%
of the market price, or you can reject and pay 10% of the market price. In the
former case, you buy a new bed and new food, and the cycle repeats. In the
latter case, the cycle repeats directly. In any case, after a few cycles, you
won't have anything left.

Also, anything that you own that is more valuable than you have money, will
just be taken from you, as people will offer to pay a little more than you can
pay, thus forcing you to sell, and then will resell at market value, thus
earning money from the difference. So, people without money couldn't own
anything anymore.

~~~
brador
1\. Food and bed are commodities, a domain name isn't.

2\. > Also, anything that you own that is more valuable than you have money,
will just be taken from you, as people will offer to pay a little more than
you can pay, thus forcing you to sell, and then will resell at market value,
thus earning money from the difference.

This makes no sense. The proposal is an open auction. Anyone can bid. The
seller cannot turn around and sell to someone else, because that someone else
would have bid too if they wanted it, driving up the price. Hence, the price
the auction ends at is the true market value of the domain, not $10.

~~~
zAy0LfpBZLC8mAC
> Food and bed are commodities, a domain name isn't.

Which is relevant how? That you cannot just buy an equivalent replacement,
therefore, it's even worse if you are forced to sell?

> Hence, the price the auction ends at is the true market value of the domain,
> not $10.

1\. Per your suggestion, the seller still is ten percent short on the market
value, so someone with money can still bankcrupt you simply by repeatedly
forcing you to sell (or prevent you from ever obtaining whatever
goods/property this rule is supposed to apply to).

2\. No, it wouldn't actually discover the market price for an illiquid good,
as the seller is effectively prevented from bidding what they value it at. If
the thing that they are being forced to sell is worth a million dollars to
them, they cannot actually bid that much if they don't happen to have 100000
dollars to spend on top, even though they supposedly own this thing that's
worth a million dollars, which should normally be enough to buy that same
million dollar thing. The only way to make that work would be if the seller
got all of the money. In which case it would be completely pointless, as the
seller could simply always bid 10 quadrillion dollars, win the auction, and
pay themselves.

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RileyKyeden
This page is stuck in a redirect loop for me. This one works:
[http://webmasters.stackexchange.com/questions/61467/if-
icann...](http://webmasters.stackexchange.com/questions/61467/if-icann-only-
charges-18%C2%A2-per-domain-name-why-am-i-paying-10)

------
jasode
Previous thread where I explain that the stackexchange accepted answer (now
with 78+ votes instead of 41) outlines more of the history rather than answer
the question in a technical way for a technical audience:

[https://news.ycombinator.com/item?id=9358902](https://news.ycombinator.com/item?id=9358902)

(small correction: my previous answer had a typo of "17 million" instead of
"11.7 million")

~~~
jasode
update to avoid confusion: when I wrote the previous post and relinked it this
morning, the accepted answer was the "government history" by ShitalShah.

After I wrote today's post, the accepted answer was changed to the "costs
dissection" by Stephen Ostermiller. That answer addresses the question better.

I assume either the original poster (Indra) or an admin changed the accepted
answer.

------
shitgoose
this is a classic example of how monopoly position is monetised. nowdays
monopolies are established and maintained by the government. there is a lot of
money to be made, being a monopoly, but government cannot show this on its
books (joe the plumber may not like that). so they create a commercial proxy
entity, that accumulates most of the profits. the part left in the shadow is
how moneys make it back to individuals in the government who arranged this
deal, but judging by how vigorously government protects the proxy, there is
little doubt that this is happening. for starters i would run a cross check
between names of verisign subcontractors and names of family and friends of
top icaan officials.

------
james_pm
There are a few different places where the money goes in a domain registration
transaction.

ICANN gets $0.18 per gTLD registration.

The registry (Verisign, Neustar, Donuts, Radix, etc.) sets a wholesale price
that the registrar pays the registry for each domain year. That can be
anything from a few bucks to hundreds or thousands of dollars (see .cars, for
example).

The registrar adds a markup to what they charge the registrant on top of that
wholesale fee.

In general, ICANN gets very little, the registry gets the most and the
registrar somewhere in between. The registrar supplements this small yearly
amount with add-on services like WHOIS privacy, or by selling email or hosting
alongside the domain.

The registrar also pays a yearly fee to be accredited by each registrar which
also adds to the cost to consumers.

------
wl
After Verisign's SiteFinder stunt, I was shocked to hear their contract was
renewed. This is the first I've read about Verisign suing ICANN over the
matter and getting a settlement giving them the contract renewal.

------
tszming
Sadly, if Verisign is not earning $7.85 per domain, I guess every possible
combinations of meaningful dot com domains were already exhausted.

------
robalfonso
I operate a registrar, I'll outline a couple pieces of the puzzle here and the
justification for the price. ( I couldn't read the stack exchange article -
redirect issue)

First its recognized these are digital goods where the incremental price is
very nearly approaching 0. Technical aspects of domain registration have very
little to do with the price.

That said ICANN has various requirements for registrars and registries that do
require more than just keeping an entry in a database. For registries, you
have to not only have a hot failover data center location for your registry
but you are contractually obligated to test it (I believe every 6 mos. but its
not my part of the industry). For registrars you have to escrow your entire
domain settings both incrementally and fully (daily and weekly) for all
domains, this way if you disappeared as a business tomorrow they could recover
everything. This is audited regularly and swift action is taken for those who
are delinquent.

Those are the technical issues, the rest of the cost is highly related to the
administrative burden of domain management.

Some of these are:

    
    
      DMCA takedown requests
    
      Generic legal requests
    
      UDRP Claims
    
      Governmental abuse claims
    
      NGO abuse claims (i.e. other hosting firms etc)
    
      WHOIS verification claims
    

We get these kinds of requests on a very regular basis (ie hourly/daily), it
takes a team of people to manage them and its a never ending torrent. Some of
them can be disposed of quickly others take a lot of time.

There is also a huge amount of what I'd term "misguided requests". For
example:

A company who makes a ICANN complaint because after the UDRP ruling saying
they won a domain and access to the domain was provided, they failed to renew
it, let it expire and another company got the domain. This happened and turned
out as you would think. This still took 1 person a week of investigation and
back and forth to dispose of.

Complaint that a domain registrant did not receive expiration notices when in
fact there is no history that they'd ever been a registrant of the domain.

People who file false WHOIS complaints with ICANN because they don't like the
domains owner, whois complaints MUST be verified or the domain is taken
offline. These complaints create a huge burden.

All of these requests have rules about procedure, deadlines that must be
complied to and a form of investigation that must be adhered to.

While many domains are nice and quiet and don't need much attention. The
legal, abuse and governmental drivers that run the modern internet create a
ton of overhead for registrars. That overhead is manifested in your fees.

This is only about normal fees. Premium domains are strictly market driven and
the "scarcity" of a domain/tld is highly subjective. Costs are less about
overhead and more about what the market bears.

Hope this has been insightful for anyone who read this far!

------
betaby
Distributed DNS like service would solve most of the problems. Something
similar to DHT for DNS.

~~~
UnoriginalGuy
Who resolves disputes in a distributed DNS system? Is it just a race for land,
first who plants a flag gets it?

The internet's domain registry does absolutely need management. It just needs
management which is unbiased and competent.

~~~
mcbits
In practice, Google is already a mediator of sorts. They decide that "car
parts" points you to carparts.com while "computer parts" points you to
newegg.com. (I hear there are other search engines that provide a similar
service.)

All we really need is a canonical identity that doesn't change when IP
addresses change. It could just as well be a random string.

------
bikamonki
The retail price of goods and services is determined by supply and demand, not
cost plus markup. Registrars will sell you both 99¢ domains that nobody wants
and premium domains at thousands of dollars. Supply just increased thanks to
new TLDs, yet demand seems to be moving slow to these new options. When more
of the new TLDs are registered and adopted by the market, overall prices will
go down. Eventually, if a blockchain-driven domain registry takes hold, ICANN
domains may become free or even disappear.

------
superasn
I think if Google and Firefox join forces and create a Dns override in their
browsers that resolves domains without querying the root servers it could be a
real game changer. I remember this used to be an option in very old versions
of IE where some company it using some plugin. This can be an end to all such
monopolistic tactics and domain squatting.

~~~
spriggan3
I don't think you understand how DNS work. And it wouldn't change a damn thing
anyway, it is exchanging a monopoly for another one. DNS aren't only used in
browsers.

------
ck2
It still blows my mind they Verisign to retain .com despite all the obvious
corruption.

------
curiousgal
Why do we even need domain names? I mean unless it's a brand, we rarely type
in a domain name, it's usually bookmarked or linked.

~~~
goblin89
> Why do we even need domain names?

Let’s assume that we retain the level of indirection by assigning UUIDs
instead of domain names. If you used Tor, you may have caught a glimpse of how
randomly looking domain names feel.

How nice would it be if we could make the domain a technical detail? Let’s say
the browser would prominently show whatever entity the certificate is
registered to instead (and HTTPS is everywhere).

To an operations engineer, readable DNS offers some advantages: in some
environments we still refer to machines, and being able to distinguish between
“eu-sigma” and “us-gamma”, for example, is much easier than between “7c07c564”
and “74c47513”. However, some may disagree[0], and anyway this doesn’t justify
the need for a _global_ DNS.

As to the end user, the primary concern is that in 2016 we still type in
domains[1], and at those times better memorability and shorter length matter a
lot. You can also see domain names referenced in anti-phishing warnings—but
with proper security practices that wouldn’t be a thing.

So I see that plus inertia—an upgrade costs time and money, and the existing
system works (and makes some people money).

[0]
[https://news.ycombinator.com/item?id=8010838](https://news.ycombinator.com/item?id=8010838)

[1] Anecdata. Not sure if any research attempted to quantify how often do
domains get typed these days, perhaps this isn’t even an issue anymore.

------
gscott
Domains used to cost $100 a year. I don't see any reason to complain (although
before they cost $100 they were free).

------
curioussavage
In short the domain name system is a racket.

------
dopkew
Why do registrars charge more per year if I try to register a domain for more
than one year?

