ICANN’s Proposed .COM Registry Agreement Sees Enhanced Security and Prices

ICANN and Verisign have released a proposed agreement to amend the .com Registry Agreement that includes a new proposed framework for working together on initiatives related to the security, stability and resiliency of the Domain Name System (DNS) in the form of a binding Letter of Intent (LOI) between the two organisations, including 7% increases in the registry fee in the final 4 of 6 years of the agreement.

In an announcement ICANN say the new terms, which are now open for public comment, will enhance the security, stability and resiliency of the DNS; provide limited and transparent pricing flexibility for .com registry services; and standardise the .com agreement by including certain technical and reporting requirements based on terms in other registry agreements between ICANN and the registry operators of other TLDs.

On 26 October 2018, following a review and deliberation by the U.S. Government, Verisign and the Department of Commerce entered into an amendment that included an extension of the Cooperative Agreement.

Under the amended Cooperative Agreement, the Department of Commerce noted that the domain name marketplace had grown more dynamic and concluded that it was in the public interest that, among other things, Verisign and ICANN may agree to amend the .com Registry Agreement to permit an increase in the .com registry fee, up to a maximum of 7% in each of the final 4 years of each 6-year period (the first 6-year period commenced in October 2018).

While Verisign does not set retail prices for .com domain names, the US Department of Commerce and Department of Justice regulate .com pricing, the proposed amendment to the .com RA will provide pricing certainty by limiting the potential maximum wholesale price for .com domain names. For example, if the 4 standard price increases are taken in this 6-year period, the maximum wholesale price for .com domain names would be $8.39 no earlier than October 2020 (compared to $7.85 today), and cannot exceed $10.26 until October 2026.

In addition to aligning the pricing for .COM registry services with the Cooperative Agreement, ICANN note the updated .com RA and LOI achieve 4 additional important objectives:

  • Alignment with certain technical and reporting obligations for the .com TLD with those in the Base gTLD Registry Agreement.
  • Incorporation of commitments related to the implementation of the Registration Data Access Protocol (RDAP), the replacement for Whois.
  • Formalisation of a framework by which ICANN and Verisign will work together to support additional enhancements to security and stability of the DNS, including to help combat DNS security threats which will include $20 million dollars over five years to support ICANN‘s initiatives.
  • Additional funding to ICANN to continue to conduct, facilitate and support activities that preserve and enhance the security and stability of the DNS, in support of Verisign’s and ICANN’s longstanding commitment in this area and ICANN’s core mission to ensure the stable and secure operation of the internet’s unique identifier systems.

But not everyone is happy. The Internet Commerce Association, one of their main constituencies being domain investors, has raised 6 areas of concern, 5 of which relate to pricing. These include questioning the large amount of additional money Verisign will receive from registry fees. The ICA claims this will be “an additional windfall of $344,630,000 per year” in October 2024.

For more information on the proposed amendment to the .com Registry Agreement, go to: https://www.icann.org/public-comments/com-amendment-3-2020-01-03-en

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