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VeriSign’s Potential Long Term Goal

Posted on the 02 November 2018 by Worldwide @thedomains

VeriSign’s potential long term goal

Mike and I were discussing the VeriSign blog post today and the subsequent outrage in the domain investor community.

Mike might be onto something though, these were his takes about the post, the disparaging language of calling some of your biggest customers “scalpers.” and the long game for Verisign.

The long game for VeriSign is about removing price caps, while these increases are nice, it’s nothing compared to removing price caps.

The new gtld’s are partially the problem

The new gtld’s have nothing remotely resembling standard pricing. From .01 specials to tiered pricing for what they deem premium names. I remember saying years ago, Verisign invented this model with .tv.

I wrote an article in 2014 when .TV premiums came back,

Verisign they were saying “WTF”. They took a lot of complaints and criticism for the premium renewal price on domains that were premium names.

So now as we have all these extensions, with no price caps, has this allowed Verisign to set the stage for their ultimate goal?

Mike said they want to replace the domain investor, that was something I used to say about .tv back on Namepros many years ago.

People were like I love .tv and hate Verisign and their pricing. I said they loved .tv so much they bought the whole registry, they want to be your competition, why let you reg for $20 and sell for $2,000? When they can just price it at $1,500 and get all the money and keep out most speculators.

George Kirikos wrote a great article a decade ago about this very topic.

From a CircleID post:

In my opinion, VeriSign (and other existing gTLD operators) are almost being invited to ask for their contracts to be amended to get the “same treatment” as new gTLDs in regards to the elimination of pricing caps. This once again could re-open the issue of tiered pricing that most have fought very hard against in order to protect registrants.

I believe the language of these proposed new gTLD contracts needs to have hard caps in place to protect existing gTLD registrants. New gTLDs are not effective substitutes for existing gTLDs, and thus “competition” isn’t going to keep VeriSign’s pricing power in check. Even with a 10-year transition period, it would shock the conscience if VeriSign was permitted to arbitrarily and unilaterally raise the renewal price of .coms to millions or billions of dollars per year (say $1 billion/yr for, $10 million/yr for, $50 million/yr for, $30 million/yr for, or whatever the market would bear), effectively re-auctioning the entire list of premium domain names to the highest bidder, removing the existing registrant and replacing things with .tv style pricing.

Mike felt they purposely used the term scalpers as it will be needed to vilify the rightful owners of the domain names they seek to charge whatever price.

It will be a political battle and by arguing these scalpers add no value will make their case seem more righteous.

The other point Mike made was what are people going to really do? If a big holder wants to drop a ton of valuable names there will be buyers and VeriSign knows that. Even better yet in a world with no price caps they get to be the speculator and charge whatever they like.

This would be years away but still something to think about and Mike also mentioned that he thought most big holders should absolutely have always owned some VeriSign stock as a hedge.

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