[Comments-com-amendment-3-03jan20] Proposed Amendment 3 to the .COM Registry Agreement

[Michael Sumner]

I am a domain investor.

No one other than Verisign want increases in .COM prices. There is
obviously no stakeholder outcry to increase prices on registrants.
Registrants themselves obviously don’t want to pay more. So who does the
proposed price increase stand to benefit? Only Verisign. It stands to reap
billions of dollars more, all paid for by registrants, and for no genuine
reason whatsoever.

If the proposed fee increases go into effect, by the end of the six-year
agreement term, the fee for each .com domain name will increase to $10.29
per year, a 30% jump from current levels. Even conservatively assuming that
in six years’ time there are only 140 million .com domain name registrants,
that increase of $2.44 per year, per domain name, would result in
$341,000,000 more revenue for Verisign per year. Verisign already enjoys an
incredible operating margin of around 60%. By any reasonable estimation,
Verisign is not suffering for lack of revenue nor is it deserving of
increased revenue. The current rate of $7.85 is already far more than
justified.

If ICANN is to be trusted as the steward of the .COM Registry on behalf of
the global public interest, ICANN must ask itself why it would effectively
hand over billions of dollars in registrant money to its contracted service
provider? Verisign is merely your manager of the .COM Registry – it has no
business dictating the price, particularly when it is already handsomely
paid and others could do it for far less. As we saw with the .Org Fiasco,
bad things happen when a registry operator treats the registry as an asset
that belongs to it, rather than acting as a mere contracted manager.

If there was ever any hope that the new gTLDs would present effective
competition to .COM so that prices would naturally be constrained by market
forces, the results are in and it didn’t happen. Because of Verisign’s
market power, and in the absence of putting the .COM Registry out for bid,
price caps are necessary to protect the public from Verisign’s ability to
abuse its market power by raising prices far above levels that would exist
in a market where there was effective competition.

ICANN is supposed to govern the domain name system in the public interest.
I want you to do so. I want you to look out for registrant interests in
particular, not your service provider’s financial interests.

Setting prices is a policy matter when it comes to the .COM Registry. If
ICANN intended to adopt such a radical policy of permitting Verisign to set
its own prices, that is a matter for stakeholders to determine, and there
has never been any such policy development nor agreement among stakeholders.

Michael Sumner
Maryland, USA
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