Donuts’ new pricing model, recently announced, has already provoked confusion among the registrants. The company’s strategy is to increase its complete fee by 50% for fresh registrations in .dog, .glass, .kitchen, .camera, .camp, shoes, .solar, .cleaning, .plumbing, and .toys.
It seems that Donuts is focused more on profitability and not on volume, considering that these domains usually retail between $25 and $40. A good news for the users in this increasing prices period is that it doesn’t apply to renewals of actual registrations.
This notion of changeable renewal pricing for non-premium domains inserts an unknown pricing model to the domains industry.
Imagine that you register today example.toys or even before October 1st, the full renewal fee for the respective domain names would be, let’s say $10 for how long you want. If you own it for 20 years, the renewal fees will still be $10 a year.
Instead if you want to register this domain name after October 1st, Donuts will ask you $15 a year in renewal fees.
The only way fees will grow is if an already registered domain in one of the gTLD exposed above would be removed and re-registered. But if you transfer or sell your domain name to another registrar the fees remain the same.
Registrars have also a critical role in the growth or decrease of the renewal fees. Actually, they are more likely to apply a constant renewal price. For example, existing .dog domains would be 50% more convenient than domains registered after October 1st.
Regarded by one registrar as a “pain” , the new pricing model makes systems update to their account and convey data about renewal tiers between each other when domains are relegated.
Variable pricing is more known than it seems, and is set to an extent by ICANN.
The standard RA denies registries from requesting some registrants higher renewal fees than others, but there are as well some exceptions. It’s all legit when the registrant accepts the renewal fee at the point of registration.
The standard RA intends to “prohibit abusive and/or discriminatory Renewal Pricing practices”.
In this way it prevents registries to enforce higher fees But there are exceptions. If the registrant explicitly agrees to the renewal fee at the point of registration, it’s legit. Donuts and others already use this exception in order to charge higher prices for premium name renewals.
The purpose of that part of the contract “is to prohibit abusive and/or discriminatory Renewal Pricing practices”, preventing registries imposing higher fees on customers that are using domains very profitability, for example.