Surprising nobody, Verisign to raise .com prices again
Verisign has announced its second consecutive annual price increase for .com domain names.
The wholesale registry fee for .com names will rise from $8.39 to $8.97 on September 1 this year, an extra $0.58 for every new or renewing domain, of which there are currently over 160 million.
Verisign announced the move, which was expected, as it announced a 2021 profit of $785 million and a 65.3% operating margin.
CEO Jim Bidzos, speaking to analysts, played down the impact of the increases on .com registrants, pointing out that .com prices were frozen under the Obama administration and have only gone up once before, last year, since 2012.
“This is the second wholesale price increase for COM since January of 2012,” he said. “So, if you look back over the last 10 years, that translates into a cost increase of only 1.3% CAGR over the last ten and a half years actually.”
The current .com contract, signed off by the Trump administration and ICANN, allows for two more 7% annual price increases, excluding the just-announced one, but Bidzos would not say whether Verisign plans to exercise those options.
If it does (and it almost certainly will) it would raise the price to $10.26, where it would stay until at least October 2026, he said.
“We believe .com continues to be positioned competitively,” he said.
It’s still basically free money for Verisign, which saw strong fourth-quarter and full-year 2021 results.
The company yesterday reported revenue of $1.33 billion for 2021, up 4.9%, with net income of $785 million, down from $815 million. The operating margin was 65.3%, compared to 65.2%.
For the fourth quarter, revenue was up 6.3% to $340 million, with net income of $330 million compared to $157 million. Operating margin was 65.3%, compared to 63.9%.
For 2022, the company is guiding for revenue of between $1.42 billion and $1.44 billion, based on the price increases and predicted unit growth of between 2.5% and 4.5%. The operating margin is expected to be between 64.5% and 65.5%.
Bidzos also addressed the controversial .web gTLD, which it won at auction but has been unable to launch due to legal action pursued by rival bidder Afilias/Altanovo.
An Independent Review Process panel recently threw a decision about .web back at ICANN, which is now considering Afilias’ allegations of wrongdoing at the board level.
“ICANN looks to be moving forward with making the decision on the delegation of .web, and we will be monitoring their process,” Bidzos said. He said that Verisign has not budgeted for any revenue or costs from .web in 2022.
That’s probably wise. Afilias recently told us that it has not stopped fighting against Verisign’s .web win.
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Is it legal rights to increase the prices for .com only once per year for 7% because there is some kind of USA law for such kind of intellectual properties that is owned in monopoly mode?