RE: [registrars] UNDER $6 PRICING BY NETSOL??

["Bhavin Turakhia" <bhavin.t@directi.com>]

Title: Your Domain Name and Full Feature Email Account

Hi Mike,

 

Thanks for the long mail. If the rest of the constituency feels that -

 

1. this issue is important enuf to discuss (I know Eliott also sent me an email abt this)

 

2. and that by discussing it we could work out a solution before 2008 (by when versign supposedly gives up control of the registry)

 

then by all means i think we should...

 

bhavin

-----Original Message-----
From: Michael D. Palage [mailto:michael@palage.com]
Sent: Wednesday, October 10, 2001 9:54 PM
To: Bhavin Turakhia; Registrars@Dnso. Org
Cc: Directi; Divyank Turakhia
Subject: RE: [registrars] UNDER $6 PRICING BY NETSOL??

Bhavin:

 

This was a topic of discussion in Montevideo. The minutes from this meeting were initially lost but have now been located. David Washer will be providing these minutes to me shortly. However, to address your concerns I will summarize the discussions that took place in Montevideo. A number of registrars in attendance (four or five) raised concerns about allegations of registrants being offered domain name registration services for below $6. Based upon the informal numbers that were discussed, there appeared to be several hundreds of thousand of registrations that fell within this alleged marketing practice. Complicating matters was the fact that these alleged reseller contracts have confidentiality provisions preventing the parties from disclosing the price. Bruce Beckwith acknowledged that their reseller agreements had confidentiality provisions, and that they would not be disclosed.

 

Because all registrar contracts with ICANN contain no pricing restriction, it is legal within the parameters of the current contract for VeriSign-Registrar to provide domain name registration services at any price, even at zero dollars for the first year on transfers as some registrars have alleged reported.  On its face it makes sense that a registrar should be able to provide a service below cost if their are other value added services that they wish to provide. The question that most registrars ask, how do you compete when the largest registrars offering these services just happens to own the registry. A question was posed to Dan Halloran of whether the independent evaluation committee that is supposed to analyze the separation between VeriSign registry/registrar would be able to look into this matter. No answer has yet been provided, but I hope Dan will be able to give us an answer by next month's meeting. My personal interpretation of the contracts based upon Joe Simm's discussion in Melbourne is that this issue falls outside the scope of that review panel.

 

I would like to offer the following clarification to prevent your valid concerns from being undermined. I do not believe that NameZero is "owned" by Network Solutions. I believe that VeriSign is an investor in NameZero, which I also believe NameZero owns NamesDirect. VeriSign in fact has its fingers in a number of registrar operations. It acquired NameSecure and Registrars.com, I also believe it has an interest in dotTV which now has a registrar operation as well. I would encourage you to dig through VeriSign's SEC filings to find out the exact nature of their relationship/investment in these various companies.

 

Based upon ICANN's rather technical mandate, I do not believe that it has the power to address your concern. I believe that only an appropriate governmental agency tasked with ensuring competition in the marketplace would have standing to address this issue. If you would like I could place this item on the agenda for Marina del Rey and have it brought to the attention of the greater Internet community.

 

Best regards,

 

Michael D. Palage

 

 

 

-----Original Message-----
From: owner-registrars@dnso.org [mailto:owner-registrars@dnso.org]On Behalf Of Bhavin Turakhia
Sent: Wednesday, October 10, 2001 5:49 AM
To: Registrars@Dnso. Org
Cc: Directi; Divyank Turakhia
Subject: [registrars] UNDER $6 PRICING BY NETSOL??

I just got this mailer (REFER below this MAIL) and couldnt first believe that someone was allowing me to renew my domain for $4.95. I then realised that NameZero is owned by network solutions and since they have to effectively pay $6 to themselves they have actually a zero cost and can sell domains for lower than $6. I had mentioned these activities to Michael in my last meeting at Stockholm, of how I had heard general rumours of netsol selling domains for under $6 discreetly. But this notice now makes it public.

 

Isnt this similar to the entire DOJ crusade against Microsoft where microsoft was taking undue advantage of its monopoly in Operating Systems to sell its application software. I see Verisign using its effective monopoly in the Registry area to cannibalise sales in the Registrar area.

 

I can see standard arguments coming from them to the effect that they have this huge inventory that they gave out free and now they want to make some money of it etc etc. The bottomline point here however remains that ONLY VERISIGN can sell domains below $6 and still make a profit. No other registrar has this privilege. By nature of this arrangement therefore if Verisign utilises this benefit it amounts to unfair competition.

 

I am looking at various possibilities that I have heard about from the market. I am not claiming or guranteeing their truth. However I know of companies who claim that they get NSI domains for less than $6 by purchasing the domain for a price higher than $6 and then getting a marketing rebate which covers this cost. As to how much truth exists in these claims I do not know, however the point still remains that only Verisign can do this and no other registrar can, and there is no provision that requires inspection or audit of their practices to ensure that this is not done.

 

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Sent: Wednesday, October 10, 2001 3:06 PM
To: divyank@directi.com
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