ICANN agreed to the increase Tuesday, saying VeriSign could impose the bump during four of the next six years. However, the company also may be allowed to boost costs during the remaining two years if it can prove security threats necessitate further increases.
Although the deal still requires Commerce Department approval, it also gives VeriSign first dibs on renewing its contract with ICANN when it expires in 2012, something competing registrars have proclaimed to be unfair.
Earlier this month, top executives from more than half a dozen registrars wrote a letter to ICANN Chairman Vint Cerf asking him to reject the contract on the grounds that it would give VeriSign too much power and raise prices for Internet addresses.
“We are writing to express our deep concern,” the letter stated. “Even if this is VeriSign’s ‘last and best offer,’ it cannot be ICANN’s.”
Signed by the CEOs and presidents of Tucows, Register.com, Schlund+Partner, Network Solutions, Intercosmos, Melbourne IT, BulkRegister and GoDaddy, the letter goes on to warn Cerf that safeguards are needed to “uphold competition, transparency and accountability” in the registrar market.
With roughly 25 million addresses under their control, the aforementioned companies currently manage an estimated 57 percent of .com domains.
“The agreement harms the Internet community by allowing unjustified price increases in most future years at a time when fees for .com addresses should be decreasing, not rising,” the letter continues. “[It also] changes the ‘presumptive renewal’ provision to deny any competition when the contact ends in 2012, locking in VeriSign as the .com registry operator without the counterbalance of competitive bid process.”
The ICANN board clearly was divided on the contract, voting only 9 to 5 for its approval. No statements from the board have yet been released.