ICANN acts to end domain tasting

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Filed under: ICANN — David Goldstein at 1:32 pm on Wednesday, January 30, 2008

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Following the recent announcement from Google that they will no longer allow monetising of domain names less than five days old, ICANN have taken their own steps to end the practice. ICANN are looking at a proposal to start charging the annual ICANN fee on registrar domain registrations.

“Domain tasting has been an issue for the Internet community and ICANN is offering this proposal as a way to stop tasting,” said Dr Paul Twomey, ICANN’s President and CEO. “Charging the ICANN fee as soon as a domain name is registered would close the loophole used by tasters to test a domain name’s profitability for free.”

Domain tasting is the use of the Add Grace Period to test the profitability of a domain name registration. The AGP is a five-day period following the initial registration of a domain name when the registration may be deleted and a credit can be issued to a registrar.

As ICANN acknowledge, tasting has been a serious challenge for the Internet community and has grown exponentially since 2004. In January 2007 the top 10 domain tasters accounted for 95% of all deleted .com and .net domain names — or 45,450,897 domain names out of 47,824,131 total deletes.

The proposal will be part of the ICANN budget process for the fiscal year starting 1 July 2008, which one would assume is the date on which the new practice will commence. The early draft version of that budget will be released for and discussed at ICANN’s New Delhi meeting later this month. After public discussions of this proposal and other budget issues, the proposed budget will be released for addition discussions by 17 May 2008 and be voted on at the board meeting to be held during the ICANN meeting in Paris in June. ICANN accredited registrars representing two-thirds of fees collected will be asked to approve the proposal.

ICANN staff presented three proposals to the board on domain tasting at the board meeting on 23 January (the minutes of which are available here). In short, these three options were (1) ICANN could revise its registrar-level transaction fee (the current rate is US$0.20, which is subject to raise as the contracted rate is US$0.25) to cover all new registrations and discontinue the exemption for “tasted” domains, (2) registries could impose a “restocking” fee for disproportionate domain deletions, or (3) ICANN could establish a new “policy” effectively deleting the add grace period policy in the registry agreements. A vote was taken, approved 13-0, “to encourage ICANN’s budgetary process to include fees for all domains added, including domains added during the AGP, and encourages community discussion involved in developing the ICANN budget, subject to both Board approval and registrar approval of this fee.”