Prices in all gTLDs will go up after ICANN told registries and registrars last week that it plans to increase the fees it charges them, sometimes called its “tax”, next year.
The extra fee ICANN takes from registrars for each new domain registration and renewal will increase from $0.18 to $0.20, according to an email sent from ICANN VP Russ Weinstein to registrars Thursday evening.
This fee is typically passed on explicitly and directly to registrants in their registrar’s shopping cart.
Less-visible charges on registries will also go up. The fixed quarterly fee will go from $6,250 per quarter ($25,000 per year) to $6,450 per quarter ($25,800 per year) and the per-transaction fee will go up from $0.25 per year to $0.258 per year.
The registry fee changes will take effect January 1, but the registrar fee changes will not take effect until July 1, 2025, the start of ICANN’s next fiscal year, according to ICANN.
“After more than a decade of no changes to registry-level and registrar-level fees, ICANN would like to increase the fees it charges to both parties,” Weinstein wrote.
The two cents tax increase is big in percentage terms — about 11% — while the registry fee is more in line with US inflation at 3.20%.
The fixed registrar accreditation fee is to stay the same at $4,000 per year, while the variable accreditation fee, which is divided between registrars based on their transaction volume, is going up from a total of $3.42 million to $3.8 million per year.
The increases come as ICANN struggles to fill a $10 million hole in its budget — a situation that has already led to layoffs — and some back-of-the-envelope calculations suggest the combined fee increases are designed to raise annual revenue in that ball-park.
Due to the differences between the standard Registry Agreement and Registrar Accreditation Agreement, ICANN can push through the registry fee increases fairly quickly and unilaterally, while the registrar changes have some red tape.
The two-cent tax increase will be part of ICANN’s usual budget process, which includes a public comment period and consideration by the board of directors, while the variable fee increase will be subject to a registrar vote.
Note: an early, unfinished draft of this post was inadvertently published on Friday, for which I can only apologize.
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