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.
I'm neither willing to pay $30, nor $100 dollars for my personal domain. $10/year is already enough, so I'd probably have to decline and risk losing my domain (because he could simply buy it for $100). I'm sure there are many scenarios where someone could even buy your domain (assuming you're not willing to pay $100), and damage your reputation (and since it is the Internet, sueing them can be impossible if he is outside of the us and getting back the domain name through a court would be way more expensive then $100).
Now, another scenario is when a domain broker bought domain B before company X does. The domain broker paid the usual price because nobody wanted it at that time. Now, company X wants to buy that domain and offers the register $100 for it. The domain broker is asked if they still want it for $100 by the domain register. They would agree knowing that they can sell the domains for a lot more than $100 to company X.
I don't see how this system could help anybody but maybe I just didn't understand your proposal right.
This has to be the only comments section on the internet where I actually get smarter by participating. :)
Squeezing out squatters also squeezes out anyone without means from domains they're not using for commercial purposes.
I already spend too much money keeping things online. Of the handful of domains I don't do much with, one is just for my primary email account. The same name is registered on other TLDs so there would probably be some demand for it. Am I making a "useful" enough use of it? There isn't even a web page on it. Am I "producing" enough "value"?
Or am I expected to lose a domain because someone else could use it to make money? Or simply because they could afford to spend more money keeping their stuff online than I do? No, that guy can go fuck himself.
We can leave other tld's for things that aren't worth $8/month to their creators.
A creative individual can come up with a new, memorable name. If you have a service about pets, then pets.com doesn't have to be your name.
For example, a friend really wanted [firstname][lastname].com, but there happened to be a hugely popular singer with this name, so he went with 1[firstname].com, resulting in a short, catchy registration.
In terms of land, you can't just create it (and in terms of reclaiming land from the sea for example, that land is considered capital).
One's target audience generally has a harder time picking up and remembering completely made up names.
1. The domain name is not worth $8/month to someone else
2. The domain name is worth $8/month to forgottenpass
3. The market for domain names is inefficient
How about because they paid for 200x .coms?
BTW, for you and some others here:
Domain squatting is when someone registers domains in the hope that trademark owners will shell out cash to get the domains.
Domain squatting is not when someone simply registers domains you happen to like and wish you owned instead.
Domain squatting is supposedly against ICANN rules, and we have a clear brand we're trying to protect.
So when it was squatted, and listed for somewhere around $1,000, I figured this was an open and shut case with ICANN. Until I found out that filing a dispute would cost me even more. Dispute resolution seems to be offered up to a couple of different organizations, all of which charge exorbitant rates to examine your case.
So squatters have a massive range of profit margin they can make, as long as they keep the prices under the ICANN dispute resolution costs.
That's not "squatting" or stealing. You just forgot to renew it or have a backup card on file or transfer the domain after his death.
You make it sound like someone came in and stole it when the onus is technically on you to maintain control of this domain. You can register a domain for multiple years if the domain is important in case of an unexpected accident (or death).
In any case, what happened afterwards? Did you get back your domain or is it still being squatted?
Either way sounds bad for a legit company just trying to set up their own site, as it gives competitors an opportunity to cost them some money.
If you had something else is mind, please share more...
When the price dropped dramatically, there was discussion on Slashdot about the effects. Most thought it was great ("hey, I, a poor college student, can get a domain now!"), but there was speculation it would lead to more domain parking.
Edit: LOL Which idiot downvoted this? The chronic lack of basic tech/internet knowledge among some people here is ridiculous.
In 1995, the NSF authorized NSI to begin charging
registrants an annual fee, for the first-time since
the domain's inception.
However this probably isn't going to change.
Even if that ended up not being the case, we'd have to fix how domains are transferred between registrars - same as how telephone numbers can be transferred between telcos but you can't sell your telephone number to someone.
If domains have to be returned back to the registrar b) doesn't apply. Auctions ensure that a) doesn't apply either.
Furthermore, adding a 7 day waiting period before returned domains become available will further ensure that parties cannot trade domains between each other but must purchase from the registrar which makes owning a domain and squatting on it for purposes of selling it pointless.
People have crowdfunded worse things.
The main reason is that most companies don't think it's necessary to pay thousands of dollars per year as a recurring REGISTRATION FEE.
If I'm understanding it correctly you will be faking nameserver entries ?
And I've had requests for it. Quite a lot of requests, even though it's not a very common name. What would follow, $100 moving to $1000, $1000 moving to $10000? Offer me $100k and I'll not give it up. For companies that own a trademark, this would also be an issue, because trademarks are not general, but product specific, see nissan.com
Such stories make me sad, especially since there are extremely few who could empathize with those who suffered and even understand the problem faced by them. I really hope there are people in the US who would support Mr. Uzi Nissan.
How is this possible with so many TLDs? Or do you mean "whenever I want a .com domain"?
So they dump all their crap, no resale value names that don't bring in more than $100 per year, as opposed to ones that don't make more than $10 per year.
As for non-"domain squatters", it seems like a great way to fuck with someone; just claim you want their domain and force them to cough up $100 or lose it.
This idea - which seems to be based on nothing more than bitterness that everyone in the world didn't sit back and wait for you to have first pick of names - is so transparently nonsensical that I find it hard to believe you are serious.
> Whenever I want a domain, most of the ones I want are taken.
You should have bought them first then, shouldn't you.
> 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.
Who are you to define value? Where people own 1000s of domains, they are always parked and bringing in money for the owner. Their profitability is the reason they are registered.
Who are you to decide that's not a valid way to make a living from domains? At least they're not spamming.
> I'd actually be happy if Verisign or any other private company or any government extracted such an unfair price
I'm sure you would, because you imagine you'd be a winner in such a situation, unfairly appropriating someone else's property.
> free up so many more useful domains for use.
There are literally millions of possible domain names that are unregistered. If your first preference is taken, do what everyone else does without complaint and think of another name, or pick a different extension, of which there are hundreds now.
>I'd love to hear good arguments against this
I'd love to hear a good argument for it.
 confession d'un voleur (confession of a thief) : http://www.confessions-voleur.net/confessions/ (in French)
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.
From page 28, no more than 38% of revenues could possibly be used to support their registry systems and obligations (this number includes costs of revenues, administrative expenses, and interest expense). The remainder, 62%, is used for expansion and profit: 9% sales and marketing ($90m), 6% R&D ($63m), the remainder to income tax and shareholders. And obviously sales and R&D take up some of administrative expenses and usage of debt raised as well.
That's a pretty sizeable margin for a non-differentiated product. If they didn't have the contract for .com and .net, there are many other players who could jump in: per page 6, "there are over 840 other operational gTLD registries" that do not use Verisign's services.
Don't bet on them losing the contract, though, unless you want to bet against Berkshire Hathaway - which recently upped its investment in Verisign despite uncertainty about ICANN's future. For better or for worse, a lot of smart people think Verisign's current business model is here to stay.
I met someone involved in the .com registry. They have multiple data centers per continent with 200 racks of equipment. Those are the major sites. Each major city/peering point may also have a smaller presence of something like 10-20 racks.
It is more than just a few dns servers. I know some of the people at DNA Made Easy. They spend a lot of time and money building and maintaining infrastructure and peering/bandwidth agreements at major peering points around the globe.
They are obviously much smaller than a major registry but they are very performant and compete at the lower end of pricing. Their prices are probably a good indication of the cost per query($125/50 Million queries). I guess the question is the number of queries per domain and how different the level of DDoS is from a DNS provider.
DNS does not work that way, Major DNS companies like RackSpace and AWS's Route 53 I suspect have higher load DNS than the Root Registries, and they offer the service for free...
It depends on what's in your resolver cache. If coming from a cold cache, you would start from the root hints file -- if you ask them for an A record for news.ycombinator.com, they give you the NS records for com. ([a-m].gtld-servers.net, and some A and AAAA records for those); these are the Verisign servers, then you ask one of those, and they tell you to go to amazon dns, then you ask amazon dns and they tell you it's a CNAME to cloudflare and you have to chase that down.
Next time you ask, hopefully, you'll have the delegations for com., ycombinator.com, and cloudflare.net. still in the cache; but if you have a small cache, or a large amount of diversity in domain names, you're still going to make a large number of requests to the Verisign servers; anyway the delegations are served with a 2 day TTL, so you'll need to come back periodically.
Why does it have to go to the .com registry? Why can't the NS servers of the registrar (GoDaddy/Namecheap/etc.) themselves provide that resolution (ycombinator.com == xx.xx.xx.xx IP) ? After all the registrars are assigned for that specific purpose, aren't they?
Looks like a centralized bureaucracy to me if each request has to go to the root com/org/net DNS servers.
They could. Any name server along the chain could just answer the question if it knew the answer. It's a matter of configuration whether a certain domain is delegated to a different nameserver. And that doesn't end at ycombinator.com. The nameserver for ycombinator.com could delegate subdomains to further nameservers, and so on.
> After all the registrars are assigned for that specific purpose, aren't they?
No, their job is to enter their customers' data into the registry's database, that's it. That is, who the owner of the domain is, and which nameservers it should be delegated to. Some registrars also provide DNS hosting, in which case their customer can choose to have them provide the DNS server that's put into the registry's database for the domain to be delegated to.
Also, the DNS doesn't just map domain names to IP addresses. You can have as many subdomains and hostnames below some domain, each pointing to different IP addresses, and you have other information in the DNS, such as which server is responsible for receiving emails for some domain name.
And in particular, none of this information is necessarily static, or even global. Large websites might have multiple webservers, and when one of them fails, they automatically remove its IP address from their DNS server so the clients only try to use the ones that actually work. Or others run DNS servers that return different IP addresses, depending on which part of the planet the request came from, to direct clients to a server that's geographically close. All of that is only possible because the responsibility is delegated to their own nameserver that they can program to behave however they want.
Also, no, not every request goes to the root servers or the com/net/org servers. Your computer, for example, asks your internet provider's DNS resolver server for any names it needs to look up. Now, your provider's server caches responses. So, if you were to go to ycombinator.com, for example, it wouldn't start at the root again, as is already knows which nameservr is responsible for ycombinator.com, as it has already looked up news.ycombinator.com in order to load this page. So it would ask the nameserver that's responsible for ycombinator.com directly. And that's also the main reason why it's built the way it is: The delegation combined with the caching distributes the load to the many individual name servers of each domain instead of having all the requests hit one central server.
It was passed in 2005, and in 2010 it was in effect for all domains, new and old. The article suggest there's a bigger burden of proof that a domain was registered for resale than what I suggested.
Edit: Actually I missed the part about paying a percentage of the top bid.
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.
> 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.
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.
Not sure this is great.. I could see non-profits losing their domains to porn sites.
Like you said, if someone buys and domain for $5 a year and holds it for a few years, and then someone offers $1000 for it during a renewal auction, the owner could pay $100 to keep it. If they decided that it wasn't worth $100, the new buyer would pay the $1000 to get ownership.
In this situation, I think it would be fair that the old owner get $100 of the buyers $1000. The same portion would be returned to the owner as it would have cost to keep the domain.
Although, this could lead to attacks if the price didn't drop back down to $5 a year. If someone owns whatever.com, and someone offers $1000 for it, the owner wouldn't just have to decide if its worth $100, but if it's worth $100 a year in perpetuity.
(small correction: my previous answer had a typo of "17 million" instead of "11.7 million")
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.
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.
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
Governmental abuse claims
NGO abuse claims (i.e. other hosting firms etc)
WHOIS verification claims
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!
The internet's domain registry does absolutely need management. It just needs management which is unbiased and competent.
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.
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, 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, 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).
 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.
1) a site or email service couldn't change hosting providers (and hence IP) without breaking all links and bookmarks
2) you couldn't have more than one site or email namespace hosted on the same machine, since the server wouldn't be able to distinguish them
Having a layer of indirection gives you much more flexibility.
And if you don't really care about the name, you can a domain for less than $2/y on one of the new TLDs.