.com/.net registry fee increase, will we see an effect?

I came across this and was curious to see what everyone else thought about the topic was. Looks like VeriSign will be increasing the fee.

"The company said later Thursday that it would raise the fees for .com domains to $6.42 from $6, a 7 percent increase, and from $3.50 to $3.85 for .net domains, a 10 percent increase. The changes would take effect on October 15."

http://www.betanews.com/article/VeriSign_Raises_com_net_Registry_Fees/1175870626

Will we see an effect because of this, if any? What are your thoughts?

Derrick

Derrick, If you remember Verisign has been trying to up their fees for the last 3 years in a row. They were unsuccessful at their last 2006 attempt. That last attempt was blocked by the leading registrars banding together, presenting the facts to ICANN. It had been decided it was not in favor of everyone's interest to raise the fees.

Even though we may see is an increase in fees, the longer term consequences may force ICANN to subsequently open up the .com and .net registry contract to competitive bidding. I think Verisign's contract is up in 2012 or something. Verisign is currently still arguing in favor of auto-renewal of the .com contract, based on the fact that they say no one else can handle it ...

If fee increases occur, you can be almost certain that it will hurt Verisign's position.

There is a great deal of skepticism in the domain registration community, and their estimated (according to their press release on April 5th) 30 billion DNS queries per day are largely unaccounted for. Some registrars are stating that nearly 1/3 to 1/2 of these queries are originating on their own systems... Whatever.

Directi founder, Bhavin Turakhia, suggested in the last (2006) round that fees should be in fact decreasing and not increasing. There were others that also stated the same thing.

So, my opinion is, if Verisign gets their requested increase, verisign will loose their contract to competitive bidding in just a few years. There will also be a large outcry in the community, and the attempt will likely be blocked.

I'm not certain about the number of .com and .net, but according to webhostinginfo, there are some 85 million registered domains, worldwide.

If verisign cannot make a profit with with an estimated 40+ million .com & .net registered domains, what does this say about them?

My prices are sticking.

Its great being a stargate reseller. They are keeping the same prices.

Dom

For the time being so are ours at rovernic.

But I am almost certain that everyone's price will go up if this actually happens. $6.42 doesn't leave much margin for stargate or even directi resellers.

Nope i spoke to my dedicated customer service agent and she said that all prices are sticking for resellers.

Even though they are getting billed a wholesale price for them.

Pricing is well cheap and will remain cheap.

Dom

Anyone know if enom said anything publicly yet, or anyone ask them yet ?

Seems they closed our ticket with "we'll have to wait and see"

problem is when the prices stay the same for the wholesalers, their margins get less, and then support gets less, and then the circle starts downward. - this is a bad sign for companies like Godaddy who already sell domains at a lose. We all want cheap domain because we suspect we will sell more hosting, I actually think the opposite. raise rates and companies like Godaddy, and others need to re-think their strategy - losing $3.00 / year or losing $4.00 / year is a big shift and the bottom line is usually worst than the 7% increase.

Wow great responses, got me thinking!

Haven't heard any public responses like from enom, but would be interested to hear what they have to say. Doubt they will make anything official till and if the rates go up.

We are going to keep our prices as well.

Derrick