Money & Business

Associations Raise Concerns Over Sale of .Org Domain to Private Equity Firm

By / Nov 22, 2019 (elinedesignservices/iStock/Getty Images Plus)

The nonprofit sector is urging the Internet Society to stop the sale of the .org domain to Ethos Capital LLC, citing fears of significantly higher domain-name renewal fees in the future.

Associations and other nonprofit organizations are concerned about increased online costs after the recent sale of the .org domain to the private equity firm Ethos Capital LLC.

Last week, Public Interest Registry—a nonprofit entity established by the Internet Society that has managed the .org domain registry since 2002—said it had reached an agreement to be acquired by Ethos for an undisclosed price. The deal is expected to close early next year.

There are roughly 10 million .org domains in operation, including most web addresses used by associations.

The concern is that Ethos will substantially raise the fee to renew domain names after the Internet Corporation for Assigned Names and Numbers (ICANN), a global entity that manages the internet’s address system, took steps in June to remove the longstanding price cap of 10 percent on renewals. ASAE submitted comments to ICANN earlier this year, arguing that removing the price cap would expose the vast association and tax-exempt sector to exploitative pricing in the years ahead.

ICANN reasoned that competition will keep prices in check, but associations with established web addresses will not risk changing their web address and losing their online identity, ASAE argued.

“Stating that nonprofit organizations can easily switch from one domain name to another if they don’t like the pricing structure ignores the reality that established nonprofits have a longstanding internet presence built on a .org domain name—a name and online reputation that the organization (not the registry operator) has spent decades cultivating,” ASAE said in its comments.

The ICANN contract allows existing registrants to renew their domain names for up to 10 years at current prices before price hikes take effect, but opponents of the sale believe this only delays the inevitable pricing instability to come.

A spokesperson for Ethos told the Wall Street Journal that the firm is committed to reasonable pricing for domain name renewals. But a coalition of organizations, including ASAE, sent a letter this week urging the Internet Society to stop the sale of Public Interest Registry to Ethos.

“A registry could abuse these powers to do significant harm to the global [nongovernmental organizations] sector,” the letter states. “We cannot afford to put them into the hands of a private equity firm that has not earned the trust of the NGO community. .Org must be managed by a leader that puts the needs of NGOs over profits.”

Chris Vest, CAE

Chris Vest, CAE is director of public policy at ASAE. More »

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