[registrars] Payments for multi year registrations.

[Rob Hall]

Bob,

I think you are way off base here. 

Frankly, I don't think any Registrars still pay only a year at a time,
as there is a negative incentive to do so.  With the Registry prices
rising each year, a Registrar would be crazy to not pay it all the years
up front, as their costs are only increasing every year.

That said, although we don't do it, I know some Registrars offer a
registration period longer than 10 years.  I think that is perfectly
acceptable for them to do so as a business model.

If a client wants to buy a 100 year Registration, and they enter into a
contract with a Registrar to do so, I see nothing wrong with that.  The
client is making a choice and the Registrar a commitment to renew the
registration for that period of time.   Sounds good to me.  

Registrars are supposed to have different business models.  That is what
makes us competitive and different.

Rob.


-----Original Message-----
From: owner-registrars at gnso.icann.org
[mailto:owner-registrars at gnso.icann.org] On Behalf Of Robert F. Connelly
Sent: Tuesday, May 29, 2007 1:50 AM
To: Registrars Constituency
Subject: [registrars] Payments for multi year registrations.

Dear Members:

Those of us who were on the ill fated "Code of Conduct Task Force" felt
that there should be a requirement that registrars taking multi year
registrations should pay the registry immediately for the full
registration paid for by the registrant.

Over the years, we have had some vigorous debates over this issue in the
RC meetings.  To me, it was analogous  to taking out a "twenty pay year"
life insurance policy and paying the broker for the first ten years --
with the broker paying the insurance company a year at a time.

When we had a run of five and ten year fraudulent registrations a couple
of years ago, I was able to see the point of putting through the first
year registration and waiting long enough for the chances of a
Chargeback to elapse before paying for the full contract.

I can see two incentives for delaying payments beyond the chargeback
issue,  1. building cash flow and 2. the expectation that registry fees
would go down with time.  I certainly had expected them to do so.  Those
of us in Core thought the six dollar fee to Verisign was very excessive.


However, not only have the registry fees *not* gone down (except .net),
they have gone up.  In addition, a very hefty ICANN fee has been added.
Registrars holding back on full payments for multi year registrations
will be hit with a shortfall at some point.  Since the RegisterFly.com
problem, we can all see the risks of building cash flow by such methods.
Some day there will be a day of reckoning.

Regards, BobC