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Pay up or Sell up, ICANN Tells Failing New gTLD (domainincite.com)

Posted by msmash on from the meanwhile-in-domain-registry-world dept.

ICANN has responded to a request for it to reduce the $25,000 annual fee it charges gTLD registries. The answer is no. From a report: That wholly unsurprising reply came in a letter from registry services director Russ Weinstein to John McCabe, CEO of failing new gTLD operator Who's Who Registry. McCabe, in November, had asked ICANN to reduce its fees for TLDs, such as its own .whoswho, that have zero levels of abuse. ICANN fees are the "single biggest item" in the company's budget, he said. His request coincided with ICANN commencing compliance proceedings against the company for failure to pay these fees.

Weinstein wrote, in a letter [PDF] published today: "We sympathize with the financial challenges that some new gTLD registry operators may be facing in the early periods of these new businesses. New gTLD operators face a challenging task of building consumer awareness and this can and may take significant time and effort." But he goes on to point out that the $25,000-a-year fee was known to all applicants before they applied, and had been subject to numerous rounds of public comment before the Applicant Guidebook was finalized.

31 of 70 comments (clear)

  1. Sorry, not sorry by OverlordQ · · Score: 4, Insightful

    If you can't afford the main thing you're building your business around, maybe you shouldn't be in business.

    --
    Your hair look like poop, Bob! - Wanker.
    1. Re:Sorry, not sorry by jellomizer · · Score: 3, Insightful

      $25,000 for a small business is a lot, but normally prohibitively expensive, especially if you plan to have it as an important part of your business.
      But I see this price akin to getting a delivery truck, or yearly rent on a storefront.

      However this price is good against "get rich quick scammer businesses" such as buying as many crap TLD as you can, sit on them, awaiting for someone to really want it and sell it for thousands more. Like which was popular in the late 1990's and early 2000's for the .COM domains. These are 0 value to society businesses. Changing $25,000 means these guys will need to spend millions of dollars upfront to get enough names to scalp later on. And their markup prices may be too much for most customers. So there is a high cost and little return.

      --
      If something is so important that you feel the need to post it on the internet... It probably isn't that important.
    2. Re:Sorry, not sorry by FaxeTheCat · · Score: 1

      >Google is in a position of power to fix this right now. They have servers all over the place and they have market dominance with their Chromium web browser. All it would take is for them to decide to create a next generation IP address identification system, put it on their servers and in their web browser code and BOOM, no more ICANN (or at least, a whole lot less reliance on ICANN)!

      That is a joke, I presume? If not it shows that you know absolutely nothing about how DNS works and what it would take to replace it. Hint: Very much of the internet traffic does not involve a web browser.

    3. Re:Sorry, not sorry by cshark · · Score: 3, Interesting

      So I looked it up. They're located in Manhattan. One of the most expensive places to operate on earth. If $25,000 a year is prohibitively expensive, as far as business costs go... where are they renting their office space? Have you seen what office space costs in Manhattan? Anywhere in NYC? They couldn't even rent a place in Brooklyn for $25,000 a year.

      And what about salaries? They have to pay people. Do you honestly mean to tell me that the entire staff costs less than $25,000 a year? Shit dude, how are they pulling that one off? Are they running the whole company with interns? My guess: No, probably not.

      What about marketing? This is the first I've ever heard of these guys, so I'm guessing that they haven't done any. But if you look at their "partners" section, there's some muscle there. There has to revenue.

      Anyway, I suppose my point is, that they're completely full of shit.
      They're trying to pull a fast one, and they're asking you to believe a story that either paints them as utterly incompetent, or impossibly small.

      I'm not buying any of it.

      --

      This signature has Super Cow Powers

    4. Re:Sorry, not sorry by rtb61 · · Score: 1

      How to fuck ICANN. Pay their stupid fees and then in your own country, ignore ICANN DNS and institute your own and if they want their DNS database recognised in your country they have to pay, lets Balkanise that fucker and see who fucking wins. Every country in the world can do that, use ICANN for international purposes and then kill it, in their own country unless ICANN agrees to pay, chaos. Good luck ICANN you days are numbered.

      --
      Chaos - everything, everywhere, everywhen
    5. Re:Sorry, not sorry by FaxeTheCat · · Score: 1

      Which would only cause country based TLDs to become unusable for international business and further emphasize that all international business will continue to only care about the .COM TLD (which most of them already do)..
      And ICANN will not really care...

    6. Re:Sorry, not sorry by WarlockD · · Score: 1

      They're trying to pull a fast one, and they're asking you to believe a story that either paints them as utterly incompetent, AND impossibly small.

      That's the one I want to say. I knew a guy who was trying to start some weird "consulting services" thing. He WAY overpaid on his T1, hired people on commision only to COLD call people. I was brought in when a friend recommended me to do a router job for some small business when one of those cold calls worked.

      I was "technically" paid 2 years latter in a bankruptcy filing from him. He was GREAT at selling himself and marketing, but had not a clue on how to hire people or any business sense.
      So I can perfectly imagine this one guy, who thought "Hey, this gTLD will make a bunch of money easy for me!". Get some start up funds because he knows people, put the office in New York so it looks legit and sits at his desk for a year without a clue on how this works.

      As the saying goes, "Never attribute to malice that which is adequately explained by stupidity."

      PS- not sure the origin of the quote anymore. I always thought it was an old Heinlein book, but is it a quote from something else?

  2. TLDs by darkain · · Score: 2

    Im aware of tons of novelty TLDs, following them closely for various business purposes. I've never even heard of "whoswho" until this article, and on top of that would never even think about registering it. That TLD is just a bad phrase. Who in their right mind would want a domain like Bobman.whoswho, it just looks and sounds ridiculous.

    1. Re:TLDs by Aighearach · · Score: 1

      it just looks and sounds ridiculous.

      Do you know who I am?! ed-gruberman.whoswho

    2. Re:TLDs by BlackOverflow · · Score: 1
      According to wikipedia:

      An open TLD, any person or entity is permitted to register. Conceived for those cited in one of the Who's Who reference titles published around the world, the registry was opened for use by private individuals, and for-profit and nonprofit entities, including those with social media aspirations. Registry policies allow for rapid takedown of non-compliant domains, for violations including imposturous registration of another's names, and proscribed uses, including pornography or adult services/applications.

      So yeah, it's basically a domain for narcissists to show off. It is totally ridiculous, and I can't imagine anyone getting this.

    3. Re:TLDs by Areyoukiddingme · · Score: 1

      So yeah, it's basically a domain for narcissists to show off. It is totally ridiculous, and I can't imagine anyone getting this.

      Have you met the US President?

    4. Re:TLDs by Obfuscant · · Score: 1

      Do you know who I am?! ed-gruberman.whoswho

      That sounds more like "ed-gruberman.thatswho".

      No, .whoswho is the gTLD that the companies that send spam saying "you're a leader in your field and you should be listed on yourfield.whoswho and we can do that for only $100 ..." would use.

    5. Re:TLDs by Aighearach · · Score: 1

      As the summary points out, if you want to change it to that it will cost you $25000/yr.

      Chump change.

  3. The math holds up by dilvish_the_damned · · Score: 5, Insightful

    It stands to reason that no sales would result in no resource usage, so the $25k may be the only real expense. This is not evidence that the price is too high, but rather a bunch of TLDs are stupid.

    --
    I think you underestimate just how much I just dont care.
    1. Re:The math holds up by dissy · · Score: 2, Insightful

      It stands to reason that no sales would result in no resource usage, so the $25k may be the only real expense. This is not evidence that the price is too high, but rather a bunch of TLDs are stupid.

      Or looking at it from the other way, presume you sell domains on your new TLD for $25/year.
      You would need to sell 1000 domains to pay just the ICANN fees.
      Or only 2000 domains to pay the fee and have $25k/yr for operating expenses.

      If there aren't enough people wanting 1000 domains, there is pretty much no reason what so ever for that TLD to exist as a separate group in the first place, IMHO.

    2. Re:The math holds up by cshark · · Score: 1

      The thing I'm wondering about is what happens to the people who did order the domains? What happens to the registry when the company behind it completely disappears?

      --

      This signature has Super Cow Powers

    3. Re:The math holds up by dissy · · Score: 1

      The thing I'm wondering about is what happens to the people who did order the domains? What happens to the registry when the company behind it completely disappears?

      ICANN auctions off the TLD to other TLD operators to be maintained, presumably only other TLD operators in good standing and with a good history at running one.

      This happened last year with the .fan and .fans gTLDs
      http://domainincite.com/22982-centralnic-now-managing-failing-fan-and-fans

      So at a technical level the TLD continues to function for domain holders, but legally it is with a new registrar company, new terms, maybe new pricing.

  4. Maybe they can get it down by bobstreo · · Score: 1

    to 3 Fiddy per domain. /s

    I think you can buy domains for a lot less than $25K

    1. Re:Maybe they can get it down by Troy+Roberts · · Score: 1

      Yes, you can. But you can not buy a global top level domain for less.

    2. Re:Maybe they can get it down by BlackOverflow · · Score: 2

      It's just a string in a database somewhere. They could literally charge anything. 25,000$ is just some arbitrary number. It seems outrageous to pay that much when there are so many cheaper alternatives available. Maybe if you have a brand new company, get a cheap one first, then go for the expensive one in a few years if things are going well.

  5. Legit Who's Who, or spammer? by Mike+Van+Pelt · · Score: 3, Insightful

    Spam touting bogus "Who's Who" publications ("You have been selected! Pay use $$$ and we'll put you in our publication that's only bought by other suckers!!") used to be really rampant. Maybe they still are, but I haven't seen one in a while... my rules for this sort of thing are pretty draconian, though.

    But just the phrase "Who's Who" makes my eyelid twitch, and my "Ban the domain, ban the IP address, ban every phrase appearing anywhere in the email" finger starts to itch.

    1. Re:Legit Who's Who, or spammer? by WoodstockJeff · · Score: 1

      Is there currently a legitimate "who's who"? Was there ever?

    2. Re:Legit Who's Who, or spammer? by KlomDark · · Score: 1

      I woke up in a Soho doorway
      The policeman knew my name
      He said, "You can go sleep at home tonight
      If you can get up and walk away"
      I staggered back to the underground
      The breeze blew back my hair
      I remembered throwing punches around
      And preachin' from my chair

      Who are you
      Who who who who
      Who are you
      Who who who who

    3. Re:Legit Who's Who, or spammer? by Mike+Van+Pelt · · Score: 2

      Is there currently a legitimate "who's who"? Was there ever?

      The Marquis Who's Who that's been around for over 100 years is legit as it gets. They don't spam. I think someone they want to include, they send paper mail to, and they don't charge for being listed.

      I think there are some British publications along those lines that have been around since the Tudors or something.

    4. Re:Legit Who's Who, or spammer? by i.r.id10t · · Score: 1

      Ah yes, the "who to rob" directory.

      --
      Don't blame me, I voted for Kodos
  6. Re:What about customers? by sexconker · · Score: 1

    As usual, ICANN hasn't thought that far ahead and doesn't care.

  7. Only $25K? by bill_mcgonigle · · Score: 1

    I thought it was $300K ... is $25K a renewal price?

    I know a few people who would pay $25K/yr for a vanity TLD (or nonprofit consortium, even).

    --
    My God, it's Full of Source!
    OUTSIDE_IP=$(dig +short my.ip @outsideip.net)
    1. Re:Only $25K? by dissy · · Score: 1

      I thought it was $300K ... is $25K a renewal price?

      Scroll down to section 5 "Fees & Timelines"

      5.2:
      The evaluation fee is estimated at US$185,000. Applicants will be required to pay a US$5,000 deposit fee per requested application slot when registering. The US$5,000 will be credited against the evaluation fee.

      5.7: ..there are two fees: (a) a fixed fee of US$6,250 per calendar quarter; (b) and a transaction fee of US$0.25. The latter does not apply until and unless more than 50,000 transactions have occurred in the TLD during any calendar quarter or any four calendar quarter period.

      It's $185,000, $5000 of that up front. That $6250/quarter is the $25,000/year.
      That comes to $210,000 the first year and another $25,000/year going forward.

      That transaction fee part sounds stupid complex, but does say per quarter if you have enough registrations.
      50,000 * 0.25 * 4 = $50k which brings that up to $260k the first year, assuming that's how they figure it. A bit closer to your $300k figure.

  8. Price is too low. by FaxeTheCat · · Score: 1

    There are too many shitty TLDs.
    We see now that most of the new domains being used in phishing emails are in one of the new TLDs.
    It is an ongoing discussion at our company if we should just block most of the new (the unestablished, and non country) TLDs.
    I am pretty certain it will happen soon, as no serious business would consider using them anyway.
    It would not surprise me if others start doing the same.
    Which would significantly reduce the value of owning a TLD.

  9. Re:It's a hobby not a company by cshark · · Score: 1

    I'm sorry, but I don't believe it. ICANN has a vetting process that's supposed to prevent hobbyists from getting tld's.
    So, either he's guilty of fraud, and he is a hobbyist... or he's full of shit. I don't really see any room for a middle ground here.

    --

    This signature has Super Cow Powers

  10. Re:What about customers? by FaxeTheCat · · Score: 1

    They most likely never considered it, as it is not their responsibility.

    Once they have delegated a TLD, the entity it is delegated to bear the full responsibility for maintaing that TLD.
    This is the way it has always been.
    Adding new top level TLDs doe note really change anything for ICANN, apart from a doubling in the number of TLDs.