22 ms·

Why ISOC sold .ORG to VCs

237 points by StuntPope 7y ago

tekacs 7y ago
Since the site seems to be struggling: http://archive.is/0aOfz http://archive.is/0aOfz
spullara 7y ago
Ethos Capital, as per their website and business model, is a private equity firm, not a VC firm. Very different things. Hard to take people seriously when they don’t know the difference.
- jessaustin 7y ago
  Are you here to argue that PE people are somehow more ethical or better at business than VC people? That's going to be a laugh line for anyone who has ever been exposed to them.
  - spullara 7y ago
    Nope. Just trying to help people distinguish the two businesses. PE companies acquire private companies and run them. VC companies invest in founders and they run the company.
    - jessaustin 7y ago
      Since we're striving for accuracy here, usually they acquire public firms and "take them private".
      - QuesnayJr 7y ago
        There are a lot of purely private transactions now -- they've already taken everybody private who wants to go private.
- zarriak 7y ago
  Calling it a VC firm is a much nicer thing to say than PE.
herodotus 7y ago
If I understand the article correctly, ISOC took a reasonable decision based on (a) they are not supposed to be a registry operator; and (b) "a bird in the hand is worth two in the bush". That is, the $75m/annum profit from .org may not last for long, but the $1.1135 billion will be a great endowment fund. The flip side is the implication (and I hope I read this correctly) is that a bunch of smart but possibly ethically challenged individuals infiltrated ISOC (a non profit) in order to create investment opportunities for themselves down the road.
- slantedview 7y ago
  Both can be true: - That ISOC was reasonably justified in taking a lump sum rather than operating a registry. - That the sale of the registry was corrupt and not in the public's best interest.
- Rebelgecko 7y ago
  Considering that the price of a .org will almost certainly be going up soon, I think that $75m/year will soon be $82million. I don't think it's sustainable to pull that amount of money every year from a 1.1 billion endowment.
  - herodotus 7y ago
    From the article (not my view): "And yet, those of us in the technology business understand viscerally that nothing lasts forever. What seems like a steady cash cow today may be obsolete sooner than anybody suspects. Personally I think even DNS will be disrupted in the future by some kind of distributed ledger technology beyond even blockchain, like hyperledger or hashgraph or some post-singularity quantum foam."
    - marcosdumay 7y ago
      Well, after that sale the odds of something disrupting DNS grew a lot.
    - donmcronald 7y ago
jacquesm 7y ago
No, that's not why they did it. They did it because they thought they could get away with it. But the charter of ISOC never was to make a mint of the .org TLD by selling it, and as far as I'm concerned this deal will be reversed at some point or we should simply set up an alternative root and a pox on both their houses.
- e2le 7y ago
  OpenNIC would be that alternative root although often are they at odds with ICANN creating new tlds that conflict with their own. It seems like the DNS system in it's current form is broken and I'm not convinced an alternative root is the solution but perhaps part of one.
  - troquerre 7y ago
    Handshake.org is trying to create an alternative root that is better (along the dimensions of security and governance) than the current system. I can see it gaining adoption especially in light of recent events.
    - e2le 7y ago
      I forgot they existed, thank you for reminding me!
    - duskwuff 7y ago
      Maybe I'm just cynical, but the fact that the first thing mentioned on their homepage is a cryptocurrency "airdrop" doesn't leave me with a confident feeling about the project's long-term viability.
      - xur17 7y ago
        That's a fair response. That said, it's worth noting: > The Project Sponsors received a minority participation (7.5%) of HNS in the interest of aligning all stakeholders, including industry. All of the 10.2MM USD collected from Project Sponsors (Funds and Individuals) will be given to Free and Open Source Software projects. The rest was all airdropped in an attempt to get wide distribution / get it in the hands of as many users as possible.
stefan_ 7y ago
The "devils advocate" first part misses that ISOC was already not operating .org, all of that was outsourced to Afilias, PIR was essentially a vehicle to pay some more graft to another set of musical chairs people that travel freely between ISOC, ICANN, PIR and Afilias.
paul7986 7y ago
TLDR: Rich get richer ICANN owner who also owns Donuts, Inc (they own all the new TLDs .donuts, etc) buys .org from former owner (ISOC) who is also now much richer.
simias 7y ago
Honestly if that analysis is correct then on one hand I concede that it does make the decision appear less like pure bribery than I initially thought but on the other it's even worse for .org users. Maybe I'm wrong to consider this a zero-sum game, but surely if ISOC made a good deal selling .org that means that Ethos Capital got the short end of the stick. That means that eventually they'll realize that they can't make as much money out of it as they had hoped. And then what will they do? Agree to continue operating the TLD at a loss? ell oh ell. It's more likely that they'll either attempt to extort more money from people who can't actually afford to migrate or "strip" the TLD for parts somehow. On the other hand if ISOC bet on the wrong horse they've lost the Goose that Laid Golden Eggs, and they'll be in a worse position to help the open web. From the point of view of people believing in the ethos (ha!) of what .org is supposed to stand for, it seems like a lose/lose situation. I still don't really think it made sense to greenlight that deal for purely monetary reasons, I think the people on that board lost track of their objective, which I think is what the author acknowledges in part in his conclusion.
- manwe150 7y ago
  > Maybe I'm wrong to consider this a zero-sum game, but surely if ISOC made a good deal selling .org that means that Ethos Capital got the short end of the stick. The field of economics, and pretty much all monetary transactions, are about demonstrating that sales (and thus wealth) are not a zero-sum game. Whether that’s true for any particular case, such as this one, can be debated forever still, just often not based simply on that assumption.
  - TeMPOraL 7y ago
    > The field of economics, and pretty much all monetary transactions, are about demonstrating that sales (and thus wealth) are not a zero-sum game. Yes, a good chunk of them are really negative-sum games, once you include all secondary stakeholders in the calculations.
    - iudqnolq 7y ago
      Care to expand on your one sentence dismissal of modern economics? Maybe a second sentence describing the means by which this happens, or an example, or even - gasp - a source?
ajkjk 7y ago
I would love for the people who did this to lose a ton of money on it.
e2le 7y ago
How often do people notice domains? I've seen many users use Google or similar to find their desired site such as facebook without typing the URL. If it were only an IPv6 address, would people even care?
- bad_user 7y ago
  I notice domains. And I don't trust domains that don't end in .com, .org or a recognizable national TLD. Besides, the point is irrelevant. When you build an online brand, you build it by having links distributed on the web, to get the Google juice going, on social media, on forums, etc. Even in business emails you add your domain there for easy reference later. Then if you have to change the domain, all of those links will be broken. As they say... Cool URIs don't change ;-) https://www.w3.org/Provider/Style/URI.html https://www.w3.org/Provider/Style/URI.html
  - e2le 7y ago
    Perhaps it was incorrect of me to claim that users don't notice domains. I suppose the issue I was getting at was users don't appear to memorize the domain and instead use Google or similar for finding the site they are looking for.
    - emn13 7y ago
      But how does google find those domains? Link juice still matters, and those links work via... domains.
      - e2le 7y ago
        Those links work with domains or addresses no matter if it's https://yourdomain.com/ https://yourdomain.com/ or https://[2001::1]/ https://[2001::1]/. Google finds those domains through a variety of means (social media, collecting other domains from the sites they index, manually submitted domains, etc). Google also indexes addresses.
        7y ago
rnhmjoj 7y ago
Can someone explain to me what actually operating a registry means? I have always assumed that it basically consists of maintaining a database replicated across a few authoritative servers and handling WOIS information but this can't possibly warrant $25M of yeary expenses.
- jessaustin 7y ago
  Administration can consume any amount of money, so long as it isn't getting in the way of the money coming in the door. Just look at universities in USA. They're not doing anything now they weren't doing in 1980, yet tuition inflation was 7% over for most of the period since then. Where did the money go? They hired more assistant administrators, to justify higher salaries for the top administrators. Also the perks are pretty nice.
  - einpoklum 7y ago
    I doubt even your numeric figure is exact; source? Anyway, supposing that it is - how do you know that's where the money went? And - how do you know the money went mostly to the same place in most universities? This sounds like a baseless generalization. PS - I'm not from the US.
    - jessaustin 7y ago
      https://www.kansascityfed.org/publications/research/er/articles/2019/1q19bundick-pollard-rise-and-fall-college-tuition-inflation https://www.kansascityfed.org/publications/research/er/artic...
      - secabeen 7y ago
        The summary here has it all laid out: >They find that supply factors such as wages in the education sector and state appropriations to higher education both play important roles in explaining changes in college tuition inflation. In contrast, they find little evidence that demand factors such as changes in the availability of student loans have a significant effect on college tuition.
kevin_thibedeau 7y ago
If they've been rolling $75M in profit for the past 15 years, why couldn't they have built their own endowment from that? Where did that money go?
- liability 7y ago
  It went up their noses.
pge 7y ago
FWIW, the economics of .org are easy to look up in the PIR 990, as of 2017. The 990 shows ~90m in revenue with ~75m in profit - which was split 40m to ISOC and 35m to ISOC foundation (a subsidiary of ISOC).
emn13 7y ago
This analysis is highly suspect. It's a great sales pitch sure - but it's false. So first of all: the overhead for running the registry is unreasonably high. You'd expect there to be considerable room for reducing costs, so the 75M$ per year is artificially low; revenue is around 100M. Secondly, that revenue is artificially (but reasonably!) low because the price is capped. But guess what? That price cap was just removed; so the actual price may rise considerably; certainly it is not reasonable to assume that under the terms specifically changed for the deal the revenue will stay at just 100M a year. Thirdly, the risk of .org evaporating is pretty absurd. The cost of a domain is (and should be) pretty trivial compared to the value most people can extract from it; the fact that this is a for-profit business at all is highly questionable - it's as if your street address were owned by a third party, and you can't have anything shipped their at your cost without the acquiescence of a third party. I'm not sure anybody is seriously buying this story of .org becoming irrelevant to the point that people won't pay 10$ (+margin above wholesale) for a domain. But even if you're unsure - the very fact that a private party snapped this up is evidence to the contrary. Fourthly, it's entirely unreasonable for ISOC to earn even a penny off of this deal. What exactly did they do to earn the right to profit of other people's valuable contributions? Right, nothing - they were just there are the right time. There's no reason they should even be an exclusive party at all, let alone one that operates with a profit motive. Fifthly, the people involved, and the timing, stinks. If this were all above-board, it should have been public and not have been bought out by insiders almost immediately after those same people are involved in enabling the deal. It's not at all transparent what those insiders were doing, but if it's not plain old highway robbery again, perhaps some transparency would have helped. Frankly, the whole cartel (DNS, not merely .org) should simply be dumped; there's just no reason this is private to start with, and most certainly not run with a profit motive; that's just asking to reasons to distort the far more important markets with rent-seeking behavior here. If chrome+safari were to sponsor an alternative to DNS, I'm sure the rest of the browsers would follow; e.g. by using a different protocol (not http(s)) to disambiguate, and by forking the existing (as of some fixed date) DNS domains. Good riddance to those leaches.
- commandersaki 7y ago
  Pretty sure PIR outsources their DNS management to afilas or something, and they even negotiated a cut of the fees by 50% in a recent bid.
ulkesh 7y ago
The real loser in this deal is us. Not only is trust lost (or already has been from other past DNS goings-on), but we, the registrants, end up paying more, financially and otherwise. Generally speaking, the underpinnings of the Internet (protocols, certain levels of infrastructure) should always and forever be public, not-for-profit, "open-source", and not patentable, in order to protect the integrity of the system. I'm no expert, so maybe a lot of it is this way already, but DNS seems to be a bastion of for-profit greed. All of this walks hand in hand with Net Neutrality, in my view -- governance to protect what is a fundamental human right, the free (as in freedom, and to some degree, as in beer) flow of information. And in an ideal world, objectively factual information.
- troquerre 7y ago
  Agreed. IMO no organization should be able to collect rent on what’s basically public infrastructure at this point.
colorincorrect 7y ago
dumb question, but if VCs decided that the venture is profitable under a certain model (aka: no limits pricing), then why doesn't the domain registry just do so themselves?
jariel 7y ago
Issue #1 is 'whether to sell it', issue #2 is the self-dealing and lack of transparency around the sale. Where was the public information? Where was the bidding process? Where was the attempt to get a publicly acceptable valuation? Why are the 'buyers' of the asset related to those on the inside? There are serious problems here, it's entirely possible they sold an asset for a fraction of it's value, amounting to a direct transfer of wealth.
IshKebab 7y ago
> But hey: if somebody offers you 11X revenues. You’re going to take it. I know I would. Not if it's only 15x profits!! And those profits are more or less guaranteed.
nikolay 7y ago
I haven't yet heard the point that if .org prices go up too much, nonprofits could abandon it and switch to .ngo, which is better anyway. Many will keep their .orgs even if prices go up 10-fold or more, but what percentage is that from all .orgs?
- walrus01 7y ago
  Why should organizations be forced to change their business cards, website address, all email addresses, letterhead, signage and such because the new venture capitalist vulture owners of .org are a pack of shady rent seekers? To quote Michael Bolton from Office Space: Samir: Hmm… well why don't you just go by Mike instead of Michael? Michael: No way. Why should I change? He's the one who sucks.
  - hjkhtroeiupwq 7y ago
    For once, .ngo is more credible. From wikipedia: > Unlike the more prevalent .org domain, which is also managed by the Public Interest Registry, .ngo will require validation of the registrant's non-governmental status
    - cupofsludge 7y ago
      It's more credible on paper, but the common internet user is more likely to know and trust .org domains then any of the new TLDs.
      - dane-pgp 7y ago
        Yes, and it is slightly amusing to think that an ordinary internet user is going to make a decision about whether to trust .org more than .ngo domains by checking Wikipedia. That's wikipedia dot org...
  - nikolay 7y ago
    We've witnessed many companies abandon .ly and .io with time. Plus, .org means "organization". Commercial entities are also organizations, so, not sure why it was chosen for nonprofits. NPO and NGO are way more meaningful abbreviations anyway.
hosh 7y ago
Isn't the ISOC the same group that initially sponsored the Lets Encrypt program?
joveian 7y ago
If the mission of the Internet Societies is to connect people to the Internet, one question is why they want to connect people to the Internet. The .org sale communicates that the reason is to extract as much money from them as possible. What they really have a problem with is the people extracting money paying to develop standards, so they strive to extract as much free labor as possible from people as their money is extracted.
samstave 7y ago
TLDs are interesting, intriguing and hard. TLDs serve as a classification structure for various aspects of human interest, knowledge, creativity and commerce... Where should the canonical for TLDs come from? Should a particular interest have its own TLD, regardless of topic - how to measure when to provide a TLD -- is it scale of interested people? is it ideologically based? As such, should there be a .dem and a .gop? if so, then should them be a .socialist? .nazi? .zionist? etc? Some of the current TLDs are silly, to me, but what is the barrier to entry and what is the criteria for approval? And most importantly, WHO APPROVES? Like literally - the names of the people who actually make TLDs happen?
gambler 7y ago
I don't want to be aware of relationships between zillion different companies and organization just to be able to understand how much it will cost to map a string to a number and what BS hoops I will have to jump through to keep that mapping "operational". It's totally absurd. DNS is a rotten system. It's rotten technically, politically and administratively. It has to be replaced by something distributed. Step #1 is to collectively admit this.
lllr_finger 7y ago
If you're a .org owner for personal use and aren't happy with this change - what are the feasible alternatives that others have settled on?
Animats 7y ago
The whole concept that the registry owner has an ownership interest in domains is just wrong. Registrars have gotten uppity. Here are the current terms from Network Solutions: "Web.com expressly reserves the right to deny, cancel, terminate, suspend, lock, or modify access to (or control of) any goods or services (including the right to cancel or transfer any domain name registration) for any reason (as determined by Web.com in its sole and absolute discretion."[1] You don't have to put up with that overreach. Compare Gandi: "You are the owner of the domain name, i.e. the individual or legal person who is declared as the owner as soon as the domain name is registered and visible as such in the "Whois" domain name directory"[2] [1] https://assets.web.com/legal/English/TermsOfUse.pdf https://assets.web.com/legal/English/TermsOfUse.pdf [2] https://contract.gandi.net/v5/contracts/18056/DomainNameConditions_FR_3.0_fr.pdf https://contract.gandi.net/v5/contracts/18056/DomainNameCond...
- jtl999 7y ago
  Gandi has had a "moral clause" in their ToS in the past. Don't know if it's ever been enforced or not.
ksec 7y ago
Adding an additional pieces of Information to the mix. Donuts, Inc, was bidding for .Web in 2016, and lost to Nu Dot. Nu Dot then sold the name to Verizon. Somehow this was unfair and they decide to sue them. ( What ? ) Had Donut got .Web, they would have floated the company and make a return of Investment. Since they lost, they figure out their next step / solution was .ORG. And the timeline in 2017 and 2018 seems to confirm that.
rdlecler1 7y ago
It would be nice if the author knew the difference between VC and PE.

237 points by StuntPope 7y ago

Since the site seems to be struggling: http://archive.is/0aOfz http://archive.is/0aOfz

Ethos Capital, as per their website and business model, is a private equity firm, not a VC firm. Very different things. Hard to take people seriously when they don’t know the difference.

jessaustin 7y ago
Are you here to argue that PE people are somehow more ethical or better at business than VC people? That's going to be a laugh line for anyone who has ever been exposed to them.
- spullara 7y ago
  Nope. Just trying to help people distinguish the two businesses. PE companies acquire private companies and run them. VC companies invest in founders and they run the company.
  - jessaustin 7y ago
    Since we're striving for accuracy here, usually they acquire public firms and "take them private".
    - QuesnayJr 7y ago
      There are a lot of purely private transactions now -- they've already taken everybody private who wants to go private.
zarriak 7y ago
Calling it a VC firm is a much nicer thing to say than PE.

herodotus 7y ago

If I understand the article correctly, ISOC took a reasonable decision based on (a) they are not supposed to be a registry operator; and (b) "a bird in the hand is worth two in the bush". That is, the $75m/annum profit from .org may not last for long, but the $1.1135 billion will be a great endowment fund. The flip side is the implication (and I hope I read this correctly) is that a bunch of smart but possibly ethically challenged individuals infiltrated ISOC (a non profit) in order to create investment opportunities for themselves down the road.

slantedview 7y ago
Both can be true: - That ISOC was reasonably justified in taking a lump sum rather than operating a registry. - That the sale of the registry was corrupt and not in the public's best interest.
Rebelgecko 7y ago
Considering that the price of a .org will almost certainly be going up soon, I think that $75m/year will soon be $82million. I don't think it's sustainable to pull that amount of money every year from a 1.1 billion endowment.
- herodotus 7y ago
  From the article (not my view): "And yet, those of us in the technology business understand viscerally that nothing lasts forever. What seems like a steady cash cow today may be obsolete sooner than anybody suspects. Personally I think even DNS will be disrupted in the future by some kind of distributed ledger technology beyond even blockchain, like hyperledger or hashgraph or some post-singularity quantum foam."
  - marcosdumay 7y ago
    Well, after that sale the odds of something disrupting DNS grew a lot.
  - donmcronald 7y ago

jacquesm 7y ago

No, that's not why they did it. They did it because they thought they could get away with it. But the charter of ISOC never was to make a mint of the .org TLD by selling it, and as far as I'm concerned this deal will be reversed at some point or we should simply set up an alternative root and a pox on both their houses.

e2le 7y ago
OpenNIC would be that alternative root although often are they at odds with ICANN creating new tlds that conflict with their own. It seems like the DNS system in it's current form is broken and I'm not convinced an alternative root is the solution but perhaps part of one.
- troquerre 7y ago
  Handshake.org is trying to create an alternative root that is better (along the dimensions of security and governance) than the current system. I can see it gaining adoption especially in light of recent events.
  - e2le 7y ago
    I forgot they existed, thank you for reminding me!
  - duskwuff 7y ago
    Maybe I'm just cynical, but the fact that the first thing mentioned on their homepage is a cryptocurrency "airdrop" doesn't leave me with a confident feeling about the project's long-term viability.
    - xur17 7y ago
      That's a fair response. That said, it's worth noting: > The Project Sponsors received a minority participation (7.5%) of HNS in the interest of aligning all stakeholders, including industry. All of the 10.2MM USD collected from Project Sponsors (Funds and Individuals) will be given to Free and Open Source Software projects. The rest was all airdropped in an attempt to get wide distribution / get it in the hands of as many users as possible.

stefan_ 7y ago

The "devils advocate" first part misses that ISOC was already not operating .org, all of that was outsourced to Afilias, PIR was essentially a vehicle to pay some more graft to another set of musical chairs people that travel freely between ISOC, ICANN, PIR and Afilias.

paul7986 7y ago

TLDR: Rich get richer ICANN owner who also owns Donuts, Inc (they own all the new TLDs .donuts, etc) buys .org from former owner (ISOC) who is also now much richer.

simias 7y ago

Honestly if that analysis is correct then on one hand I concede that it does make the decision appear less like pure bribery than I initially thought but on the other it's even worse for .org users. Maybe I'm wrong to consider this a zero-sum game, but surely if ISOC made a good deal selling .org that means that Ethos Capital got the short end of the stick. That means that eventually they'll realize that they can't make as much money out of it as they had hoped. And then what will they do? Agree to continue operating the TLD at a loss? ell oh ell. It's more likely that they'll either attempt to extort more money from people who can't actually afford to migrate or "strip" the TLD for parts somehow. On the other hand if ISOC bet on the wrong horse they've lost the Goose that Laid Golden Eggs, and they'll be in a worse position to help the open web. From the point of view of people believing in the ethos (ha!) of what .org is supposed to stand for, it seems like a lose/lose situation. I still don't really think it made sense to greenlight that deal for purely monetary reasons, I think the people on that board lost track of their objective, which I think is what the author acknowledges in part in his conclusion.

manwe150 7y ago
> Maybe I'm wrong to consider this a zero-sum game, but surely if ISOC made a good deal selling .org that means that Ethos Capital got the short end of the stick. The field of economics, and pretty much all monetary transactions, are about demonstrating that sales (and thus wealth) are not a zero-sum game. Whether that’s true for any particular case, such as this one, can be debated forever still, just often not based simply on that assumption.
- TeMPOraL 7y ago
  > The field of economics, and pretty much all monetary transactions, are about demonstrating that sales (and thus wealth) are not a zero-sum game. Yes, a good chunk of them are really negative-sum games, once you include all secondary stakeholders in the calculations.
  - iudqnolq 7y ago
    Care to expand on your one sentence dismissal of modern economics? Maybe a second sentence describing the means by which this happens, or an example, or even - gasp - a source?

ajkjk 7y ago

I would love for the people who did this to lose a ton of money on it.

e2le 7y ago

How often do people notice domains? I've seen many users use Google or similar to find their desired site such as facebook without typing the URL. If it were only an IPv6 address, would people even care?

bad_user 7y ago
I notice domains. And I don't trust domains that don't end in .com, .org or a recognizable national TLD. Besides, the point is irrelevant. When you build an online brand, you build it by having links distributed on the web, to get the Google juice going, on social media, on forums, etc. Even in business emails you add your domain there for easy reference later. Then if you have to change the domain, all of those links will be broken. As they say... Cool URIs don't change ;-) https://www.w3.org/Provider/Style/URI.html https://www.w3.org/Provider/Style/URI.html
- e2le 7y ago
  Perhaps it was incorrect of me to claim that users don't notice domains. I suppose the issue I was getting at was users don't appear to memorize the domain and instead use Google or similar for finding the site they are looking for.
  - emn13 7y ago
    But how does google find those domains? Link juice still matters, and those links work via... domains.
    - e2le 7y ago
      Those links work with domains or addresses no matter if it's https://yourdomain.com/ https://yourdomain.com/ or https://[2001::1]/ https://[2001::1]/. Google finds those domains through a variety of means (social media, collecting other domains from the sites they index, manually submitted domains, etc). Google also indexes addresses.
      - 7y ago

rnhmjoj 7y ago

Can someone explain to me what actually operating a registry means? I have always assumed that it basically consists of maintaining a database replicated across a few authoritative servers and handling WOIS information but this can't possibly warrant $25M of yeary expenses.

jessaustin 7y ago
Administration can consume any amount of money, so long as it isn't getting in the way of the money coming in the door. Just look at universities in USA. They're not doing anything now they weren't doing in 1980, yet tuition inflation was 7% over for most of the period since then. Where did the money go? They hired more assistant administrators, to justify higher salaries for the top administrators. Also the perks are pretty nice.
- einpoklum 7y ago
  I doubt even your numeric figure is exact; source? Anyway, supposing that it is - how do you know that's where the money went? And - how do you know the money went mostly to the same place in most universities? This sounds like a baseless generalization. PS - I'm not from the US.
  - jessaustin 7y ago
    https://www.kansascityfed.org/publications/research/er/articles/2019/1q19bundick-pollard-rise-and-fall-college-tuition-inflation https://www.kansascityfed.org/publications/research/er/artic...
    - secabeen 7y ago
      The summary here has it all laid out: >They find that supply factors such as wages in the education sector and state appropriations to higher education both play important roles in explaining changes in college tuition inflation. In contrast, they find little evidence that demand factors such as changes in the availability of student loans have a significant effect on college tuition.

kevin_thibedeau 7y ago

If they've been rolling $75M in profit for the past 15 years, why couldn't they have built their own endowment from that? Where did that money go?

liability 7y ago
It went up their noses.

pge 7y ago

FWIW, the economics of .org are easy to look up in the PIR 990, as of 2017. The 990 shows ~90m in revenue with ~75m in profit - which was split 40m to ISOC and 35m to ISOC foundation (a subsidiary of ISOC).

emn13 7y ago

This analysis is highly suspect. It's a great sales pitch sure - but it's false. So first of all: the overhead for running the registry is unreasonably high. You'd expect there to be considerable room for reducing costs, so the 75M$ per year is artificially low; revenue is around 100M. Secondly, that revenue is artificially (but reasonably!) low because the price is capped. But guess what? That price cap was just removed; so the actual price may rise considerably; certainly it is not reasonable to assume that under the terms specifically changed for the deal the revenue will stay at just 100M a year. Thirdly, the risk of .org evaporating is pretty absurd. The cost of a domain is (and should be) pretty trivial compared to the value most people can extract from it; the fact that this is a for-profit business at all is highly questionable - it's as if your street address were owned by a third party, and you can't have anything shipped their at your cost without the acquiescence of a third party. I'm not sure anybody is seriously buying this story of .org becoming irrelevant to the point that people won't pay 10$ (+margin above wholesale) for a domain. But even if you're unsure - the very fact that a private party snapped this up is evidence to the contrary. Fourthly, it's entirely unreasonable for ISOC to earn even a penny off of this deal. What exactly did they do to earn the right to profit of other people's valuable contributions? Right, nothing - they were just there are the right time. There's no reason they should even be an exclusive party at all, let alone one that operates with a profit motive. Fifthly, the people involved, and the timing, stinks. If this were all above-board, it should have been public and not have been bought out by insiders almost immediately after those same people are involved in enabling the deal. It's not at all transparent what those insiders were doing, but if it's not plain old highway robbery again, perhaps some transparency would have helped. Frankly, the whole cartel (DNS, not merely .org) should simply be dumped; there's just no reason this is private to start with, and most certainly not run with a profit motive; that's just asking to reasons to distort the far more important markets with rent-seeking behavior here. If chrome+safari were to sponsor an alternative to DNS, I'm sure the rest of the browsers would follow; e.g. by using a different protocol (not http(s)) to disambiguate, and by forking the existing (as of some fixed date) DNS domains. Good riddance to those leaches.

commandersaki 7y ago
Pretty sure PIR outsources their DNS management to afilas or something, and they even negotiated a cut of the fees by 50% in a recent bid.

ulkesh 7y ago

The real loser in this deal is us. Not only is trust lost (or already has been from other past DNS goings-on), but we, the registrants, end up paying more, financially and otherwise. Generally speaking, the underpinnings of the Internet (protocols, certain levels of infrastructure) should always and forever be public, not-for-profit, "open-source", and not patentable, in order to protect the integrity of the system. I'm no expert, so maybe a lot of it is this way already, but DNS seems to be a bastion of for-profit greed. All of this walks hand in hand with Net Neutrality, in my view -- governance to protect what is a fundamental human right, the free (as in freedom, and to some degree, as in beer) flow of information. And in an ideal world, objectively factual information.

troquerre 7y ago
Agreed. IMO no organization should be able to collect rent on what’s basically public infrastructure at this point.

colorincorrect 7y ago

dumb question, but if VCs decided that the venture is profitable under a certain model (aka: no limits pricing), then why doesn't the domain registry just do so themselves?

jariel 7y ago

Issue #1 is 'whether to sell it', issue #2 is the self-dealing and lack of transparency around the sale. Where was the public information? Where was the bidding process? Where was the attempt to get a publicly acceptable valuation? Why are the 'buyers' of the asset related to those on the inside? There are serious problems here, it's entirely possible they sold an asset for a fraction of it's value, amounting to a direct transfer of wealth.

IshKebab 7y ago

> But hey: if somebody offers you 11X revenues. You’re going to take it. I know I would. Not if it's only 15x profits!! And those profits are more or less guaranteed.

nikolay 7y ago

I haven't yet heard the point that if .org prices go up too much, nonprofits could abandon it and switch to .ngo, which is better anyway. Many will keep their .orgs even if prices go up 10-fold or more, but what percentage is that from all .orgs?

walrus01 7y ago
Why should organizations be forced to change their business cards, website address, all email addresses, letterhead, signage and such because the new venture capitalist vulture owners of .org are a pack of shady rent seekers? To quote Michael Bolton from Office Space: Samir: Hmm… well why don't you just go by Mike instead of Michael? Michael: No way. Why should I change? He's the one who sucks.
- hjkhtroeiupwq 7y ago
  For once, .ngo is more credible. From wikipedia: > Unlike the more prevalent .org domain, which is also managed by the Public Interest Registry, .ngo will require validation of the registrant's non-governmental status
  - cupofsludge 7y ago
    It's more credible on paper, but the common internet user is more likely to know and trust .org domains then any of the new TLDs.
    - dane-pgp 7y ago
      Yes, and it is slightly amusing to think that an ordinary internet user is going to make a decision about whether to trust .org more than .ngo domains by checking Wikipedia. That's wikipedia dot org...
- nikolay 7y ago
  We've witnessed many companies abandon .ly and .io with time. Plus, .org means "organization". Commercial entities are also organizations, so, not sure why it was chosen for nonprofits. NPO and NGO are way more meaningful abbreviations anyway.

hosh 7y ago

Isn't the ISOC the same group that initially sponsored the Lets Encrypt program?

joveian 7y ago

If the mission of the Internet Societies is to connect people to the Internet, one question is why they want to connect people to the Internet. The .org sale communicates that the reason is to extract as much money from them as possible. What they really have a problem with is the people extracting money paying to develop standards, so they strive to extract as much free labor as possible from people as their money is extracted.

samstave 7y ago

TLDs are interesting, intriguing and hard. TLDs serve as a classification structure for various aspects of human interest, knowledge, creativity and commerce... Where should the canonical for TLDs come from? Should a particular interest have its own TLD, regardless of topic - how to measure when to provide a TLD -- is it scale of interested people? is it ideologically based? As such, should there be a .dem and a .gop? if so, then should them be a .socialist? .nazi? .zionist? etc? Some of the current TLDs are silly, to me, but what is the barrier to entry and what is the criteria for approval? And most importantly, WHO APPROVES? Like literally - the names of the people who actually make TLDs happen?

gambler 7y ago

I don't want to be aware of relationships between zillion different companies and organization just to be able to understand how much it will cost to map a string to a number and what BS hoops I will have to jump through to keep that mapping "operational". It's totally absurd. DNS is a rotten system. It's rotten technically, politically and administratively. It has to be replaced by something distributed. Step #1 is to collectively admit this.

lllr_finger 7y ago

If you're a .org owner for personal use and aren't happy with this change - what are the feasible alternatives that others have settled on?

Animats 7y ago

The whole concept that the registry owner has an ownership interest in domains is just wrong. Registrars have gotten uppity. Here are the current terms from Network Solutions: "Web.com expressly reserves the right to deny, cancel, terminate, suspend, lock, or modify access to (or control of) any goods or services (including the right to cancel or transfer any domain name registration) for any reason (as determined by Web.com in its sole and absolute discretion."[1] You don't have to put up with that overreach. Compare Gandi: "You are the owner of the domain name, i.e. the individual or legal person who is declared as the owner as soon as the domain name is registered and visible as such in the "Whois" domain name directory"[2] [1] https://assets.web.com/legal/English/TermsOfUse.pdf https://assets.web.com/legal/English/TermsOfUse.pdf [2] https://contract.gandi.net/v5/contracts/18056/DomainNameConditions_FR_3.0_fr.pdf https://contract.gandi.net/v5/contracts/18056/DomainNameCond...

jtl999 7y ago
Gandi has had a "moral clause" in their ToS in the past. Don't know if it's ever been enforced or not.

ksec 7y ago

Adding an additional pieces of Information to the mix. Donuts, Inc, was bidding for .Web in 2016, and lost to Nu Dot. Nu Dot then sold the name to Verizon. Somehow this was unfair and they decide to sue them. ( What ? ) Had Donut got .Web, they would have floated the company and make a return of Investment. Since they lost, they figure out their next step / solution was .ORG. And the timeline in 2017 and 2018 seems to confirm that.

rdlecler1 7y ago

It would be nice if the author knew the difference between VC and PE.