Network Solutions Inc has published the details of the contractual agreement it is going to require all new registrars to sign. From late April five companies, handpicked by the Internet Corporation for Assigned Names and Numbers (ICANN) will begin using NSI’s shared registry system to register domain names in the .com, .net and .org name spaces.
Since 1993, NSI has had the US government-sanctioned monopoly on not only registering the names with users and companies, but also controlling the database of the names and its propagation throughout the internet – what is known as the registry business. These five companies and those that follow will not have the ability to update the database – NSI has the registry contract until at least September 2000 – but they will be able to solicit business from those wanting new domain names with a workable profit margin. At present NSI has about 150 resellers around the world that take the orders for new names, but have to pass on most of the registration fee to NSI.
Once the two-month testing phase is over, ICANN will begin accepting applications for other companies wishing to become a registrar, but they must meet ICANN’s accreditation guidelines, which include a minimum liquid capital requirement. Those guidelines were agreed by the ICANN board last week, but are yet to published. It is thought that major telecommunications companies will dominate the group of five because of the capital requirements and risks involved.
NSI has published its registry-registrar contract as part of its obligations under its cooperative agreement with the US government, which was amended in October 1998. The company says it produced the contract by itself, without input from the government or ICANN. NSI is asking for each registrar to pay a one-time fee of $10,000 for the protocols and software it has written, and $16 for each domain name they register for one year, or $32 for two years. NSI as a combined registry an registrar, currently charges $70 per name for two years. The company says the $16/$32 figure is a best estimate at present and it might change. In addition, the contract says that NSI reserves the right to increase that charge from October 1, 2000. NSI will provide basic technical support to the registrars, but additional support will be charged at whatever its standard hourly rate is. The registrars also must adhere to NSI’s policies that restrict the use of certain domain names that NSI believes to be obscene, which could prove to be a controversial point.
NSI’s own registrar business, called WorldNic, will be free to compete with the new registrars, but there must be a strict division between its registry and registrar so it does not gain an advantage from having access to the database. The main advantage WorldNic will have, however, is that it will inherit all of NSI’s current customers. The contract does not describe the software in any way, which is confidential proprietary NSI information. The company has started a review process of its software with an advisory committee, but at its first meeting in late January, only two committee members showed up.
