May 15, 2001 : VeriSign Close to Closing Domains Deal

📅 May 15, 2001 - The Department of Commerce expressed on Monday that it was confident it would grant VeriSign Inc. (verisign.com), the Internet's leading source of domain names, extended rights to manage the most popular domain names, including those with the .net and .com extensions.
On Monday, officials from the Department of Commerce, VeriSign and the oversight board for Internet names met for several hours to discuss the deal, which could mean millions of dollars in revenue for VeriSign, which now receives $6 each year for every domain name registered in its master directory.
Following the meeting, the department said that officials are pleased with the progress, and are confident that an agreement can be reached in the near term. The department did not say when it would rule, or what conditions it might attach to its approval. VeriSign said the department suggested some minor changes, but nothing that would break the deal, or fundamentally change it.
Although under the current regulations, VeriSign must give up the .org domains by next year, it would retain .net until 2006 and .com until 2007. The company would also have favorable renewal options for .com, by far the most common and popular extension, accounting for three quarters of the 28 million .com, .net and .org names in use.
VeriSign says the deal would give the company the stability to spend $200 million on research and improvements to its existing registry databases, which are touched in some way by every Internet user who visits a Web site or sends an email to an address using one of those suffixes.
While the deal will not affect the way users navigate the Internet, it could affect things like the prices of domain names. The deal has already been approved by the Internet Corporation for Assigned Names and Numbers, the organization created by the US government in 1998 to oversee Internet naming policy. Approval by the Department of Commerce was the final step.
But while the deal is meeting with regulatory approval, there is some opposition from competitors, who say the proposal is a windfall for the giant VeriSign, and claim the deal was negotiated in private, with hardly any community input. The Names Council, a subcommittee of ICANN, suggested either requiring additional conditions, or keeping the contract terms as they were, which would have forced VeriSign to sell some of its business in order to continue running the databases past 2003.
While the new arrangement leaves the fate of the .org extension in question, officials have suggested that the suffix might eventually be restricted to nonprofit organizations. They have not, however, said what would happen to .org names already registered by companies and individuals not organized as nonprofit.
No decisions are expected regarding the .org extension until next year.