Re: [wg-c] Possible solution to lock in? For Profit registries.

[Milton Mueller <mueller@syr.edu>]

"Cade,Marilyn S - LGA" wrote:

> I don't think that NSI has been really subject to that kind of oversight,
> since there wasn't competition in registry business.

Good point.
Economists have dealt with the issue of switching costs (what this list calls
"lock-in") in some detail. We know that if a market is growing and there is
intense competition for new customers that any attempt to opportunistically
exploit existing customers, a.k.a. the phony AOL scenario, would literally
destroy the business of a registry. Also, in a competitive market customers
can overcome the lock-in scenario by bargaining for long-term contracts. These
contracts can also include switching scenarios. Given the disjunction between
a domain name's cost of supply and its possible value to a user, registries
might find that they could charge more for a service that offered such
options. But such improvements in service and security will only happen in a
competitive, free market.

Point is, we can have competition in the registry business.

FWIW, the "threaten AOL" scenario is completely impossible in NSI's case
anyway, because NSI's registry prices are now fixed by the US Dept of
Commerce. Did Kent and Dave bother to read the new registry agreements? (And
if these agreements are so terrible then why did your friends at ICANN sign
them and publicly defend them?)


> At 09:41 AM 11/20/1999 , Robert F. Connelly wrote:
>
> >Dear Kent:  As I have said several times, in case for-profit registries
> >are permitted, then there needs to be a facility such as a public
> >utilities commission to oversee pricing, profits, salaries of officers,
> etc.

Bob: If regulation is necessary, it will be necessary for non-profits as well
as for-profits.

--
m i l t o n   m u e l l e r // m u e l l e r @ s y r . e d u
syracuse university          http://istweb.syr.edu/~mueller/