RE: [registrars] .net Renewal Fees (fwd)

["Christopher Kruk" <chrisk@xxxxxxxxxxxxxxxx>]

Wasn't this process already tried and completed successfully through
PIR for the .org migration? I don't recall there being a problem.


Chris Kruk
Business Area Manager
DomainPeople.com
http://www.domainpeople.com
1-604-639-1680



-----Original Message-----
From: owner-registrars@xxxxxxxxxxxxxx
[mailto:owner-registrars@xxxxxxxxxxxxxx]On Behalf Of Mark Jeftovic
Sent: Friday, January 21, 2005 10:25 AM
To: Registrars Constituency
Subject: [registrars] .net Renewal Fees (fwd)



Moving right along to the next can of worms. Denic sent this into
our support queue this morning. I imagine you all received one too.

The concern seems to be around how multi-year registrations under
.net will survive (or not survive) the transition to a new registry
operator for .net tld.

The two options described below: a) verisign keeps the money or
b) verisign returns the money to registrars seems to imply that
a serious fracas may ensue over these multiyear terms.

IF: Verisign returns the unused fees to registrars then I guess its
up to us to then remit those fees to the new registry operator to keep
the multi-year terms intact (are the costs to the new operator going to
be in line with present costs?)

or IF:

A) Verisign keeps the money
B) The new operator is NOT Verisign
C) The new operator decides not to "eat" the multi-year registrations

then

D) The registrants will get screwed

and

E) The registrars will be left holding the bag.


Am I understanding this correctly? Is this a serious possibility?

-mark

--
Mark Jeftovic <markjr@xxxxxxxxxxx>
Co-founder, easyDNS Technologies Inc.
ph. +1-(416)-535-8672 ext 225
fx. +1-(416)-535-0237

---------- Forwarded message ----------
Date: Fri, 21 Jan 2005 13:00:43 -0500 (EST)
From: easyDNS Support <support@xxxxxxxxxxx>
To: markjr@xxxxxxxxxxx
Subject: .net Renewal Fees (fwd)



Forwarded message follows......
-------------------------------

Dear Registrar

As one of the domain registry operators vying to take over the
administration of .net, we wanted to inform you of an important issue
regarding .net registration/renewal fees that is currently not resolved -
one that should be of great interest to you as a .net registrar.

In ICANN's Request for Proposal (RFP) to all competing .net registries, a
statement was added at the last moment regarding the transfer of
registration fees (or lack thereof) from VeriSign to the successor registry
operator. On Page 12 of the RFP, under 'Section 4: Revenue and Pricing
Model', it is stated:

"All applicants should note that registration fees paid to VeriSign prior to
the actual transfer of operational responsibility will not be transferred to
a subsequent registry operator."

In the event VeriSign is not selected on March 31 as the .net registry
moving forward, this statement leaves important questions unanswered and is
concerning - for registries and registrars alike. At face value, it could
imply either a) VeriSign will be allowed to retain monies from registrars
for services not being provided (after June 30), or b) VeriSign will be
asked to return monies to registrars for services that were to be performed
after June 30 - as ICANN has made clear those monies will not be transferred
to the successor registry. We've submitted a letter to ICANN in December
asking for clarification of this statement (please see letter posted on
ICANN website dated December 16, 2004 -
http://www.icann.org/correspondence/), but as of January 20, we have not yet
received a response.

We recognize that .net renewal fees are often paid in multi-year increments,
in some cases up to ten years at a time. As you can imagine, at more than
five million registered domains, these multi-year renewal fees paid in
advance to VeriSign add up quickly to a significant amount of money.
Certainly, it was your understanding at the time these payments were made
that they would go towards the improvement of the .net infrastructure and
for the delivery of related domain registration services.

It is our sincere hope that this is indeed the case, but until clarification
is made by ICANN, we believe it is in your best interest to NOT pay any
additional .net renewal fees to VeriSign, for services beyond June 30, 2005,
until a decision has been reached by ICANN on March 31, 2005, at which time
it is expected to name the new .net registry operator.

As part of our proposal, which was officially submitted to ICANN on January
18th, we submitted a business case that focuses on technically and
financially stable operations of .net.

To offer the highest level of technical stability and security, DENIC will
provide a state of the art technical architecture with very high levels of
redundancy. Generously-apportioned server hardware will enable DENIC to
deliver outstanding response times as well as robust performance under peak
conditions. To provide these services, DENIC has planned massive investments
in infrastructure for 2005.

To guarantee the highest level of financial stability and security, DENIC
has based its business model for .net on sound and fair financial planning.
Thus, DENIC is minimizing any risk for the operation of .net. Although
DENIC's business focuses on a 100% secure provision of .net regarding any
technical and financial risks, we intend to reduce the prices of .net domain
registrations initially by 10 percent. Over time, as more and more renewals
come in and our revenue for services provided increases, we will make
further reductions in price. A realistic price for 2009 therefore would be
approximately $ 3.60.

Our not-for-profit business model will allow for such price reductions,
regardless of how the above matter is resolved by ICANN. However, should
ICANN reverse its decision and mandate VeriSign to transfer fees for
services beyond June 30, 2005 to the successor registry, or if ICANN asks
VeriSign to return the unearned monies to .net registrars who in turn would
then pay fees to the successor registry, then we would be able to make
further price reductions - and to do so sooner rather than later.

Because fair and equal treatment of all registrars is a key point for DENIC,
we will not offer any promotional rates for the registration of new .net
domains. We believe by offering reduced prices for new registrations,
thereby asking existing .net registrants to cross-subsidize new customers,
is not fair and equitable to all customers. DENIC proved with its .de
operations that a business case based on long-term considerations enables
the registry to provide better, more innovative services at much lower
prices than operations only based on short-term considerations.

We felt it was important to bring this issue to your attention. If your .net
registrations are up for renewal in the next few months, or if you have any
questions about fees you've already paid to VeriSign for services after June
30, we'd suggest you write to ICANN and ask for immediate clarification. We,
too, will continue to seek clarification, and will inform you as soon as we
hear anything.


Best regards,

Sabine Dolderer
CEO, DENIC eG