[council] Market mechanisms that support competition?

[DannyYounger@cs.com]

If we are to remain true to the spirit of the White Paper, we have an 
obligation to promote competition.    I would like to draw your attention to 
a practice that can inhibit competition.

When a domain expires, it falls into that ill-defined netherland known as a 
"grace period".   That period may be as short as thirty days or as long as a 
registrar chooses it to be.  During that "grace period" the registrar may 
place the expired domain with an auction house.  

Should the original registrant seek to renew his domain, the domain will be 
renewed for the original registrant and removed from the auction market, 
however, should a registrant (other than the original domain name holder) 
wish to acquire the domain, that new registrant would pay the registration 
fee, the escrow fee and the handling/commission fee, and thereby receive 
title to the domain.  

During this "grace period" cycle, the domain is effectively the captured 
property of whichever registrar handled the original registration.  It is not 
released into the pool of available names on a timely schedule; instead it 
becomes the market opportunity for a single registrar, rather than being 
promptly available for registration by all registrars.   

This serves to not only raise the price for the commodity (thereby hurting 
the consumer), but to deprive all other registrars of a level playing field 
and competitive opportunities.  

As the two largest registrars, that jointly command 62% of all registrations 
in com/net/org, also own the two largest auction houses, we are looking at 
what may be a fast-approaching storm on the horizon.

As you begin your Council deliberations on transfers and expired domain name 
policies (or the lack thereof), you may wish to consider the need for more 
sharply defined policies with respect to hoarding and speculation.