AT-LARGE GATEWAY

At-Large Website

ALAC

RALOs

At-Large Regional Policy Engagement Program (ARPEP)

At-Large Governance

At-Large Reports

Policy Comments & Advice

Working Groups

ICANN Meetings

At-Large Summit (ATLAS III)

At-Large Review Implementation Plan Development

ALAC and RALO Elections, Selections, and Appointments

At-Large Priority Activities - 2021

Comment Close
Date		Statement
Name 

Status

Assignee(s)

Call for
Comments Open		Call for
Comments
Close 		Vote OpenVote CloseDate of SubmissionStaff Contact and EmailStatement Number
 Phase 1 Assessment of the Competitive Effects Associated with the New gTLD ProgramNo Statementn/an/an/an/an/an/a
Eleeza Agopian
eleeza.agopian@icann.org
n/a

For information about this Public Comment, please click here 

Brief Overview

Purpose: The Phase 1 Assessment of the Competitive Effects Associated with the New gTLDProgram is one input to be considered by the Competition, Consumer Trust and Consumer Choice Review Team, to be convened in accordance with section 9.3 of the Affirmation of Commitments. The report establishes a baseline assessment of the competitive marketplace in the domain name system and will be used as a point of comparison in a year’s time when the Phase 2 Assessment is conducted. That assessment will further consider how the New gTLDProgram has impacted competition in the DNS.

Current Status: The Phase 1 Assessment is published to help establish a baseline of competitive forces in the domain name marketplace both prior to and in the initial months of the New gTLD Program, beginning with the first new gTLD to be delegated as part of the New gTLDProgram in October 2013. This report considers pricing and registration volume data from a sample of legacy gTLDs (those that existed prior to expansion), new gTLDs and ccTLDs.

Next Steps: Public comments received on this report will be summarized and analyzed, and will help inform the design for the Phase 2 Assessment.  The input received on the report will also be provided to the Competition, Consumer Trust and Consumer Choice Review Team along with the report.

Section I: Description, Explanation, and Purpose

The study, conducted by Analysis Group, is in response to three recommended metrics that theICANN Board adopted in support of the Competition, Consumer Choice and Consumer Trust review of the New gTLD Program, as mandated by the Affirmation of Commitments. 
Analysis Group reports several key findings:

  • Wholesale price dispersion is greater in new gTLDs than among gTLDs that existed prior to the New gTLD Program’s expansion of the domain name system.
  • When add-on products offered by registrars are considered (such as email and web hosting), the cost of registering a domain name is a relatively small part of the total cost of creating a website.
  • Among add-on products, some display very little price dispersion across registrars (e.g., forwarding services) while others have much more variation (e.g., services designed to assist customers in building websites).

The report includes several major analyses of pricing, including in the wholesale and retail markets, as well as Sunrise period pricing. To establish a baseline, Analysis Group has used the following analyses:

  • Price dispersion: These evaluations explored dispersion among several dimensions – Sunrise period prices, wholesale prices, retail prices, mark-ups, and add-on pricing.
  • Price index: Average prices from a sample of TLDs were used to create a price index, both weighted and unweighted, which allows for broader comparisons across TLDs.
  • Registration distributions: Exploring trends in registration volumes allows for insights into the impact pricing has on consumers’ buying decisions.

ICANN invites public comments on the report. The comments will be used to guide Phase 2, which will be conducted in a year’s time to determine if there are changes or trends in the marketplace.

Section II: Background

As part of the upcoming Competition, Consumer Trust and Consumer Choice (CCT) review of the New gTLD Program, the ICANN Board adopted 66 recommended metrics from an Implementation Advisory Group made up of members from several stakeholder groups. Among the 66 metrics were a subset of three identified as best being measured by an independent economic study.

The ICANN Board adopted this recommendation to commission an economic study in March 2014 at the ICANN 51 meeting in Singapore to establish a baseline of competitive effects in the domain name marketplace as soon as possible, in advance of the expected start for the CCTreview. A second phase study is planned in a year’s time to allow for comparisons.

Section III: Relevant Resources

Section IV: Additional Information

Section V: Reports

Staff Contact

Eleeza Agopian
eleeza.agopian@icann.org

 

FINAL VERSION TO BE SUBMITTED IF RATIFIED

The final version to be submitted, if the draft is ratified, will be placed here by upon completion of the vote. 


FINAL DRAFT VERSION TO BE VOTED UPON BY THE ALAC

The final draft version to be voted upon by the ALAC will be placed here before the vote is to begin.

 

FIRST DRAFT SUBMITTED

The first draft submitted will be placed here before the call for comments begins.

  • No labels

1 Comment

  1. Ariel Liang

    Analysis by Maureen Hilyard

    ==

    Summary of the report on the Phase 1 Assessment of the Competitive Effects Associated with the New gTLD Programme.

     

    The purpose of this initial Phase 1 Assessment report was to establish a baseline description of metrics that can be used to assess the competitive conditions in the marketplace for domain names.  A subsequent Phase II Assessment will provide a deeper analysis of the competitive effects associated with the new gTLD programme.

    The report compared the progress of the 428 new gTLDs with the 22 legacy TLDs in existence, 18 months following the date of the delegation of the first new gTLDs. In brief it was found that legacy TLDs, despite having historical restrictions on pricing whereas new gTLDs don’t, still account for the majority of domain names. Some operators are marketing new gTLDs on the assumption that they will be valued more than legacy TLDs so that there is a greater dispersion of their wholesale prices. The main competition comes about due to the add-on services provided by registrars such as email and web-hosting as well as the cost of registering a domain name. There is quite some variation among registrars as to the cost of these services. 

    While the expansion of new gTLDS has created a market with hundreds of TLD options for consumers, these TLDs vary substantially in priced. Analyses of the findings revealed:

    • The majority of domain name registrations are currently accounted for by legacy TLDs.
    • The top 4 legacy registries were responsible for 97.3% of legacy registrations whereas registration shares for new gTLDs are more dispersed
    • Regional distribution of new gTLDs show a greater number of registries in Europe, North America and Asia Pacific (65, 46 and 26) as opposed to Latin America (4) and Africa (2).
    • All gTLDs must have a sunrise period which enables trademark holders time to register domain names in the new gTLD prior to others, but a concern has been raised about some registries exploiting trademark holders so that prices of new gTLDs  can vary during this sunrise period from $0 to nearly $3000.
    • Historical pricing restricts registration of legacy TLDs from $5 to $100.
    • Wholesale and retail prices show a similar trend for this wide range of pricing among gTLDs but a full analysis of why price dispersion exists was not available in this study.
    • Registrars compete not only on the prices of the TLDs offered but also on the non-product dimensions such as delivery, customer service, customer loyalty programmes and other factors, for example, website services.  Further information from registrars is required to assess the full value of these add-on services.
    • Registrars with higher prices have higher registration volumes.

    Comment:  While this report gives an interesting initial overview of the first 18 months of the competitive environment of the new gTLD programme, a further year or two will give a better indication of registration trends and prices especially with regards to the historical restriction on pricing of legacy TLDs, and to further assess public demand and its impact on pricing.