Registrars Say VeriSign Too Powerful

NEW YORK — Top executives from more than half a dozen registrars have written a letter to ICANN Chairman Vint Cerf asking him to reject a new contract with VeriSign they say would give the registrar too much power and raise prices for Internet addresses.

Specifically, the challenging registrars argue the contract would give VeriSign the right to increase prices by seven percent annually without providing a cost justification and also would essentially strip away safeguards to keep VeriSign from gaining a monopoly over “.com” address registrations.

“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,” continues the letter. “[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 letter also calls into question a $200 million investment officials at VeriSign claim was spent on the company’s .com infrastructure as part of its contract with ICANN. Though Cert has said he is satisfied that VeriSign did in fact invest that much money, many in the online community doubt the investment was so high.

“[We request] third party verification of the $200 million investments in the .com infrastructure required of VeriSign under the current contract,” the letter states.

ICANN has not yet published a response to the letter.

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