Domain Name Price Increase 2012

Recently I have been busy locking in my domains before the price rise that in case you didn’t know happened on as January 15th, 2012. The price of .com domains rose by 7% and .net domains by 10%.

7% across thousands of domains is a lot of money, and these year-on-year rises are making domainers think twice about holding onto domains that aren’t returning enough in parking or aren’t receiving buying offers. The agreement between ICAAN and Verisign states that they can increase the cost of .com and .net domains in any 4yrs of the 6-year agreement they signed. Here are the finer details of that agreement:

(ii) for each calendar year beginning with 1 January 2007, the smaller of the preceding year’s Maximum Price or the highest price charged during the preceding year, multiplied by 1.07; provided, however, that such increases shall only be permitted in four years of any six year term of the Agreement.”

Unfortunately, this doesn’t help the plight of domainers at a time when there is an economic squeeze on; it seems most goods and services are coming down in value, except domain names! It isn’t like they need to encourage the registration of domains by lowering prices though; the internet is still growing at a steady rate and people need domain names and domainers need domains to sell those in need.

I think these price increases might put people off getting into the industry, or at least stop domainers speculating on so many domains. This might be a good thing, though. It will stop domainers registering everything and anything, leaving at least some names for the average Joe to register without hindrance, and on the other hand make domainers more selective, conducting better research and making more informed purchases, which will ultimately lead to more profitability (I hope).

I do fear a time when domain name renewal fee will be sky high, $30 plus, meaning a huge cull for most domainers. This would be a smart move on behalf the web community/police – whoever they are- when you think about it. Stopping domainers registering domains means less cybersquatting, endless parking and hoarding domains. But until then, the show will go on….