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[ga] Re: [icann-delete] WLS - Better Margins for Registrars


--- Eric Schneider <eric@unames.com> wrote:
> Registrars are concerned about how they can make money from WLS
> without
> having flashbacks of the cut throat thin margins of providing domain
> name
> registration services.  The burning question is how can registrars
> and for
> that matter all constituencies get paid fairly from this newly
> proposed
> service?

When you start talking about "getting paid fairly", you're opening the
anti-trust door. There's a fixed amount of value due to the intrinsic
value of the names themselves. WLS isn't providing a valuable service
-- the value, as others have also pointed out, is in the name itself.
Competition as we have now amongst registrars and different business
models ensures that consumers and registrars alike are getting a fair
> provide reusability services.  If you disagree that it is not the
> Registry's
> responsibility to manage such services then I encourage you to run
> your own
> Registry and elect not to.

Sure, I'll do it for less than the $180 million per year that Verisign
charges. How about it, Chuck? :) This is simply a ploy by Verisign to
enter a new market where there already exists competition, and take it
> Just because WLS, if implemented, may stifle other secondary market
> models
> does not mean in the slightest that WLS stifles competition amongst
> registrars.  Currently, secondary market models and proposals other

Competition is stifled. All that happens is that existing competitors
get the privilege of being resellers of Verisign services, instead of
being allowed to innovate as they are now.

> than WLS
> seem only interested in solving the problem of recycling domain names
> upon
> or after the domain name expiry date.  By nature, there is little
> flexibility of any model that manages domain name reusability before
> the
> expiry date.  The bottom line is that there are only so many ways to
> roll-out a WLS type service and I challenge anyone to propose new
> models
> that solve the issues of reusability before expiration.

It's been admitted that there exist no issues of reusability. The WLS
proposal and the pounding of the registry have been de-coupled, since
VRSN can easily fix the problem of load by implementing the technical
fixes that they've refused to do so.
> Face it, registering a domain name or registering a back-order is a
> vanilla
> process where the dimension of competition is limited only to price. 

SnapNames has suggested that folks can innovate on the basis of colour
schemes and jazzy graphics on a website. I know when I'm shopping for
domain services, having a fancy graphic makes me willing to pay 60%
margins! :) [sarcasm, for the humour-impaired]

> Personally speaking, I am in disgust over the devolved science of the
> insane
> free-for-all hoarding of dropped domain names like a gold rush in the
> wild
> west while being patronized by the propaganda of registrars claiming
> that
> they are doing this on my behalf, for my benefit, the consumer.  Grow
> up and
> stop belittling the consumer by assuming that the only substantial
> market
> group is that of a speculator.  Keep your eye on the ball stupid and
> remember that you are in the subscription business, the first rule of
> which
> is to retain subscribership.

A cleaner argument could not be made AGAINST the WLS, by those words.
Verisign can and should have no problem continuing to make $6 per name,
regardless of whether or not it was previously registered. Any WLS or
other proposal is making it more valuable to lose a subscribership
rather than get a renewal.
> Personally, I think that the first-time purchase of a back-order
> should be treated as a fixed expense of sorts.  There should be no
> price competition between registrars for the initial purchase with
> the price set at $100 for anyone, anytime, and anywhere.  By so
> doing all constituencies including ICANN, Registry, and Registrar
> get paid fairly.

You leave out the "registrant". Basically, your pricing scheme is a
centrally-planned model, similar to what central-planners did under
communism. They'd set a price based on what they thought was "fair",
rather than allowing the market to set the price and mechanism through
competition. To be blunt, if you want to be a central planner and want
a price that is "fair", you should not be in the domain business, which
is run on free-market principles. I'll rely on a competitive
marketplace to determine prices and valid business models, rather than
a single individual (you), monopolist (Verisign), or cartel (all
registrars co-ordinating to price-fix). 

Since that competitive market exists now, you'd better provide a darn
good reason why you want to interfere in it. Saying that "system load
is too high" obviously isn't one of those good reasons (problem is
fixed easily, and Verisign/SnapNames have backed off the suggestion
that WLS solves system load). Saying that "I'm not making enough money
in this existing competitive market, thus I want to corner it" is not a
good reason either.


George Kirikos

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