Re: [ga] The Future of Domain Registry Pricing, if left uncapped

[Danny Younger <dannyyounger@xxxxxxxxx>]

Veni,

In Louis Touton's Second Analysis of VeriSign Global
Registry Services' Request for Amendment to Registry
Agreement, he stated:

"The registry agreements provide for price caps for
domain-name registrations and other registry services
because the sole-source basis on which those services
necessarily must be provided creates the potential for
abusive charges. Where a registry operator is placed
in a position of market power (particularly customer
lock-in) by virtue of its appointment by ICANN, it has
been viewed to be appropriate to guard against abuses
of this market power. This can mean that
cost-plus-reasonable profit price caps are appropriate
in some cases. Where market mechanisms are effective
to restrain prices, on the other hand, it should not
be necessary to establish price caps.

The treatment of economic/competition issues (such as
the establishment of price caps) is a difficult role
for ICANN, because of limitations both on ICANN's
appropriate role and on its economic expertise. Some
have expressed concern that the role of establishing
price caps stretches beyond ICANN's appropriate
mission, while others have noted that registry
operators are placed by ICANN in a position of
economic power, sometimes with little or no
market-based restraints, that requires protective
conditions including limitations on prices charged for
sole-source services. This dilemma ? the potential
need for price restraints in some situations coupled
with the general unsuitability of ICANN to supply
those restraints ? has led ICANN in the past to seek
to rely on competitive mechanisms to establish price
caps where possible (such as by allowing prospective
operators to provide competitive bids of prices and
then requiring them to adhere to their proposals).
Although economic/competition issues are necessarily
implicated by ICANN's activities from time to time, it
has been remarked in the ongoing reform process that
ICANN should establish means to obtain appropriate
expert advice from better-situated organizations to
assist in addressing these issues."

I deem it prudent to listen to the advice of ICANN's
former General Counsel as well as to the counsel
provided by the prior reform process.  It strikes me
as reasonable to secure the views of organizations
such as the OECD (or other economic/competition
authorities) on the topic of monopoly price caps prior
to any action being taken by ICANN.  

I ask if you would be willing to champion this view
amongst your fellow Board members?  Please note that
those within the GNSO's Task Force on Policies for
Contractual Conditions for Existing gTLDs have
discussed inviting the commentary of:

Prof. Martin Cave, Centre for Management under
Regulation, University of Warwick, UK
Dr. Andrew Odlyzko, University of Minn., USA
Dr. Sam Paltridge, OECD 
Dr. Michael Katz - former FCC and FTC economist
The firm "Analyses Consulting" - London & US

The community considers expert commentary to be
warranted.  Perhaps you share the same view?

best regards,
Danny


--- Veni Markovski <veni@xxxxxxxx> wrote:

> George,
> what's your point? That this is a market, and you
> need it to be 
> regulated? Or that there are people who make lots of
> money by 
> registering tens of thousands, or hundreds of
> thousands of domain 
> names, and this should be stopped? Or that the price
> should not be "whatever"?
> 
> How about the ccTLD? The only competition so far to
> the ".com" has 
> been ".de", and this will change with China and
> India entering this 
> market. So, why not ask ICANN to deal also with the
> ccTLD prices? Or 
> may be not ICANN, but the ITU, with some new
> settlement agreement 
> between ccTLDs?
> 
> Etc., etc.
> 
> veni
> 
> At 06:56 PM 08.8.2006 '?.'  -0400, George Kirikos
> wrote:
> >Hi folks,
> >
> >If you want to get a sense of where domain name
> wholesale costs might
> >be heading if Neustar, Verisign et al are able to
> charge whatever they
> >want, we need only look at the pricing for Common
> Short Codes, today,
> >which Neustar runs:
> >
> >http://www.usshortcodes.com/
> >http://www.usshortcodes.com/csc_obtain_a_csc.html
> >
> >"Registering and leasing a CSC costs $1,000 per
> month for each
> >"Selected CSC" and $500 per month for each "Random
> CSC." THESE FEES ARE
> >NON-REFUNDABLE REGARDLESS OF WHETHER ANY WIRELESS
> CARRIER AGREES TO
> >ACTIVATE YOUR CSC. The Registry must receive
> payment in full for the
> >duration of the registration at the time your
> application is approved.
> >We offer Registration Terms of 3 months, 6 months
> and one year. Because
> >fees are due up front, if you register a Selected
> CSC for three months
> >the cost is $3000.00, and Random CSC for three
> months is $1500.00."
> >
> >Of course, we also have the example of .tv,
> http://www.tv/ where some
> >names are six-figures+ per year as .tv. Naturally,
> .com names would be
> >priced at a huge premium to any equivalent .tv.
> >
> >Sincerely,
> >
> >George Kirikos
> >http://www.kirikos.com/
> 
> 


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