How it all works
Domain Registries are the wholesale operators of TLDs. Registries, for the most part, do not sell directly to customers. This makes Domain Registrars the distributor or the middle-man for domain names. Most Registries are free to set their own prices. Verisign, the Registry which operates .com and other TLDs, is the exception. Verisign is in a contract with the US Government that placed a .com price cap of $7.85 in 2012. Verisign recently won a battle to amend this contract. According to Allemann, the amended agreement states that Verisign will be able to charge $10.29 per .com domain name six years from now.
Who profits from the .com price cap?
The news of the lifted .com price cap is not ideal for domain owners who have portfolios with hundreds and thousands of domains, many of which are .com. Selling domain names is a game of patience. Domain investors sometimes sit on names for years before they sell them for profit. The idea of the .com price cap was put in place to protect consumers however this isn’t always the case. Just because Verisign has a .com price cap does not mean that the Registrars do. Verisign is prohibited from selling directly to end users or anyone other than ICANN-accredited Registrars.
Registrars can charge whatever retail prices for .com domains they see fit. Here at 101domain, we are not the cheapest and we are not the most expensive. We do however believe in full transparency with our pricing which is why you can always see prices for new registrations, renewals, and transfers on all of our product pages. Other Registrars sell the first-year way below wholesale cost and then mark up the prices for renewals in the following years. We aren’t a fan of this tactic and believe in selling our domains to consumers and businesses at a reasonable price they can expect.
We should support small businesses
“I’m gonna wait to see how other people respond before I decide.”
“Doesn’t he know
“She’s never going to make it.”
I believe that domain investors should be more empathetic to the fact that many of the people buying domain names from them are small fries. They aren’t the huge mega-corporations, they are the start-ups, the small businesses and the people who are starting their very first website. We all want to succeed and thrive. We should all be in the business of doing what we can to help the people around us succeed. If that means amending the .com price cap or reconsidering the price you are charging for domains in the secondary market, we should all do our part. We shouldn’t be cutting each other down. We are are all on the same team and want to see success and growth in the domain industry. Together we need to find a solution and steer the industry in that direction.
If you’re not first…
But at the end of the day, it’s the name of the game. Domain names have always been and will always be a first-come-first-served product. The perfect name for your website and online branding is invaluable. No matter the .com price cap whoever registers the domain first whether it is another business or a domain investor has the right to hold on to it or let it go for whatever price is worth it to them.
Question for our readers:
Where do you stand on the .com price cap?