Customers and Internet Community Deserve Better .COM Registry Deal
February 15, 2006; 12:38 PM
GoDaddy.com, the No. 1 registrar of domain names worldwide, today voiced its strong disapproval of a pending agreement between the Internet Corporation for Assigned Names and Numbers (ICANN) and VeriSign.
"The proposed agreement is a bad deal for our customers and the Internet
community as a whole," said Bob Parsons, CEO and Founder of GoDaddy.com. "We will fight to convince the ICANN Board of Directors not to accept it."
ICANN, the governing body of the Internet, has been working to settle a
lawsuit with VeriSign, which manages .COM and .NET domain name extensions. The proposed settlement agreement would allow VeriSign to raise registration fees by 7% annually in four of the next six years. It also would give VeriSign control of the .COM registry indefinitely, as it extends VeriSign's "presumptive renewal" right when this proposed settlement agreement ends in 2012.
Industry research(1) verifies that costs involved in the technology
critical to the domain name registration infrastructure are continually
decreasing. Server costs have declined 10-18% over the last three years due to improved server efficiency and software stability. Bandwidth costs have fallen roughly 35% per year since 2001 because of new delivery methods and competition among providers. Storage costs have dropped approximately 45% per year since 1999, as more data can now be stored in the same physical space.
Going forward, these downward trends do not appear to be slowing. "Under no circumstances should VeriSign be allowed to raise .COM prices
without cost-based justification," Parsons said. "If VeriSign does request an
increase, it needs to result in competitive bidding for the registry contract.
This would certainly create lower prices, not higher, just as it did for the
At the end of 2004, ICANN opened the .NET registry for bidding. VeriSign won the contract from among five competitive bids. The result of this process reduced the price of domain name registration nearly in half from their pre-bidding levels. There are approximately 7 million .NET registrations, compared to nearly 44 million .COM registrations.
".COM domain names still account for more than 80% of net new
registrations. If there is any automatic change in pricing in the agreement,
it should be for an annual decrease resulting from economies of scale and
efficiencies that naturally occur in our industry," Parsons said.
Parsons is also troubled by the closed nature of the process involved in
this settlement. ICANN claims that VeriSign has met its obligation to invest
$200 million in development and infrastructure under the current agreement. However, ICANN has kept VeriSign's reports confidential, which raises
questions about the integrity of the arrangement.
"ICANN must be open and transparent in its actions. We need to see these
reports made public and verified by a third party. Internet registrars,
service providers and users demand that ICANN be held accountable," Parsons said.
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About The Go Daddy Group, Inc.
GoDaddy.com, Inc. is the "on-ramp" to the Internet for individuals and
businesses worldwide, providing a one-stop shop for acquiring, creating and safeguarding a unique online identity. GoDaddy.com offers a comprehensive line of Internet products and services, including domain name registration, web hosting solutions, personalized email packages, SSL certificates, web development tools, eCommerce utilities and more. GoDaddy.com is the world's No. 1 domain name registrar, both in terms of new registrations and domains under management. The Go Daddy Group includes three ICANN-accredited domain name registrars: flagship registrar GoDaddy.com, Inc.
(http://www.GoDaddy.com), membership-based registrar Blue Razor(R) Domains, Inc. (http://www.bluerazor.com), and reseller registrar Wild West Domains(R), Inc. (http://www.wildwestdomains.com). The Go Daddy Group also offers private domain name registration services through Domains By Proxy(R), Inc. (http://www.domainsbyproxy.com), as well as SSL Certificates through its SSL Certificate Authority, Starfield Technologies(R), Inc. (http://www.starfieldtech.com). The Go Daddy Group registers or renews a domain name every 3 seconds and has nearly 12 million domain names in its portfolio. The Go Daddy Group is also the world's largest web host in terms of hostnames.