RE: [ga] Tiered (Variable) Pricing

["Michael D. Palage" <Michael@xxxxxxxxxx>]

Elisabeth:

It is so good to hear from you. I truly miss your regular attendance and
participation at ICANN events.

With regard to your first comment. Yes, there are tiered pricing models
for existing communication services. However, these tiered(variable)
pricing are generally uniform or non-discriminatory. Although I have no
restrictions on my land line in connection with the number of calls I
may receive, the same does not apply to my cell phone where I only have
an allotted number of minutes for incoming/outgoing calls prior to being
charged an additional surcharge. In my paper I talk about protecting
reasonable expectation interests of registrants. In the case of Google
they are currently paying a $6 registry fee for the name google.com. I
believe once they have registered this name, this registrant should not
be subject to any discriminatory per domain name pricing fees. The only
fee increase that Google should be subject to would be a uniform rate
increase imposed on all registrants.  However, if Google wanted G.COM
since G is not currently allocated, VeriSign would have the option to
impose a tiered pricing model on this allocation. 

Turning to your second comment, I can tell you that registries today
deal with liability issues on a regular basis even under today's price
regulated basis. I agree that any type of tiered(variable) pricing may
raise additional legal concerns. However, I do not see any reason why
these legal concerns cannot be managed by the registry, nor while ICANN
should have to indemnify the registry. I think any per domain name
tiered(variable) pricing needs to be based on primarily objective
criteria, and applied in a non-discriminatory manner. 

With regard to the allocation of these names and balancing potential IP
interests, lets take O.COM. Overstock has been a very vocal participant
within the ICANN community regarding the release of single letter domain
names. The question that may eventually have to be answered if single
letter names are allocated is who gets it? There are numerous trademark
registrations in connection with the letter "O". An additional question
which must be asked is should a trademark registration serve as a
monopoly to prevent the general public from registering a common letter
of the alphabet?

These are some of the legal issues which are direct and a not so
insignificant expense in connection with running a registry. Danny
talked about how economy of scale should require mandated price
decreases. Unfortunately, the legal expenses in connection with running
a registry are generally inversely proportional. The more names, the
more potential legal issues. There are also other costs which are
similarly inversely proportional in running a registry such as increased
infrastructure cost to mitigate against DDOS attacks, DNSSEC
implementation, IDNs, etc.

So at the end of the day, I believe your post really sheds light on an
important aspect. Running a registry is not merely about running a
database. There are numerous business and legal factors that must be
accounted for in the operation of a business and thus factored into the
overall price of a domain name. 

Best regards,

Michael









-----Original Message-----
From: Elisabeth Porteneuve [mailto:Elisabeth.Porteneuve@xxxxxxxxxxxx] 
Sent: Thursday, August 31, 2006 9:47 AM
To: Michael@xxxxxxxxxx; ga@xxxxxxxxxxxxxx
Subject: Re: [ga] Tiered (Variable) Pricing




> Hello All:
> 
> In the interesting of continuing a very constructive dialog with 
> regard to tiered pricing, I have published the following article on 
> CircleID, see 
> http://www.circleid.com/posts/tiered_variable_pricing_compromise/.
> Some of the initial comments such as George's continues to take an
"all
> or nothing approach" to the current registry contracts.  The purpose
of
> this article was to address what I saw as one loophole which could be
> closed to protect reasonable expectation interests of registrants
while
> allowing registries the flexibility to use tiered(variable) pricing in
> their business operations.
> 
> Best regards,
> 
> Michael D. Palage
> 

Hello Mike, hello All,

I have been following with the great interest the debate.

I have two comments:

1. With regards to existing commerce of communication services 
   (whatever it is, phone, DSL, domain name, web hosting), is it 
   legally allowed that the seller does not provide a uniform price 
   (possibly split up into something related to the distance of 
   customer to the next communication hub)? What about your telephone 
   company, the day they realise you use your well known telephone 
   number for professional services, and ask you additional fees for 
   a number of received calls or whatever?

2. I assume that it would be possible the registries charge different 
   price to different customers, and relate it to, for example, the 
   notoriety of a company, asking Google for millions, and my 
   namenobodyisinterestedbutme.TLD for a minimal fee. 
   My question is how the registry will deal with liability? In other 
   words, today all registrars/registries selling names claim their 
   liability limited for nominal fees, exactly like Kodak's films in 
   old times - they provide a support for communication (name) regarless

   of the content. If you accept the fees for domain names being related

   to the economy behind a name, or just anything else, that changes a
lot. 
   Do you think registries/registrars will have insurance far beyond the

   technical service, which is all it should be about? Do you think
   ICANN will have to take care for liaibility for variable pricing?
   I know that years ago some ccTLD registries have been analysing their

   own insurance, and as far as I recall, none decided their
responsibility 
   is beyond technical service for domain names.
   A subsequent question with variable pricing: how can you avoid the
   seller of namenobodyisinterestedbutme.TLD does not blackmail me
   for a colour of my eyes, or a country I am coming from?

Kind regards,
Elisabeth Porteneuve