While .com domains are getting much pricier, you can get a co.za from R75 a year – but there’s a catch
- Due to a new agreement reached by the International Corporation for the Internet for Assigned Names and Numbers (ICANN) and VeriSign, .COM domains are likely to get more expensive.
- The agreement means that the company that administers all .com domains, can increase the prices by 7% per year for the next three years.
- You can still get a .co.za for much cheaper, as some hosting companies sell these domains at or below cost price - in order to lock customers into monthly hosting packages.
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".com" domains are likely to get a lot more expensive, due to a new agreement reached by the Internet Corporation for Assigned Names and Numbers (ICANN) and VeriSign.
The agreement means that Verisign, the company that administers all .com domains, can increase the prices by 7% per year for the next three years. There will then be a two-year freeze on price increases, but between 2026 and 2029 the 7% annual increases will resume.
The intention is that this will then be an ongoing cycle that will see the wholesale price of .com domain prices rise significantly in the coming decade.
The current wholesale price of a .COM domain is $7.85, or almost R120 - which has remained unchanged for several years. But with the new changes approved by ICANN, these domains will likely increase by up to 70% over the next 10 years.
The agreement also allows for increases under extraordinary circumstances, which may result in even higher costs.
But the impact of this policy on consumers is still unclear, because the final price that consumers will pay for a .COM domain depends on whether individual registrars pass on these costs.
There has been some criticism about the increases and the process through which ICANN reached this agreement, but ICANN says the impact will not be significant for users.
“If the four standard price increases are taken in this six-year period, the maximum wholesale price for .com domain names would be $8.39 no earlier than October 26, 2020 (compared to $7.85 today), and cannot exceed $10.26 until October 2026”.
Given that most domain resale companies purchase these in bulk at the dictated prices, and then sell them on with their own margins - often by adding on superfluous products and offering a discounted first year with increasing prices over subsequent years - much of the increases will be determined by the market.
The gold standard of domains
".com" domains were one of the first top-level domains to be used at the introduction of the internet. The first was registered in 1985, and the original intention was that they would only represent websites that had commercial intent.
But over the years, .com evolved to become the unofficial top level domain of the United States, and, ultimately, the most sought-after top-level domain in the world - regardless of the website’s location or nature.
Although ICANN has introduced new top-level domains in order to create a wider pool of options to choose from, the significance of a good .com website address is still as high as ever.
Domains still relatively cheap
Even so, considering the popularity of .com domains, the cost of registering a new one - if you can find it - is still relatively low, especially compared to other business expenses.
Although the price of the domain varies according to its scarcity, popularity, and the profit taken by the registration company or domain name holder, it’s possible to register a new .COM locally for as little as R170 per year. This represents a profit of R51.80 per year for the registration company.
Compared to .co.za domains, however, this is still expensive. Most generic domains ending in .co.za cost between R75 and R100 per year, depending on the registration company.
But domain registration fees are typically one of the smallest costs associated with running a website. Website owners who want to operate a live site with their domain have to pay hosting fees that can run into the thousands per year, depending on the traffic the site sees. Because of this, some hosting companies may sell these domains at or below cost price - which the ZA Central Registry indicates is R149.50 per year - in order to lock customers into monthly hosting packages.
In some cases, domain and hosting companies offer either cheap hosting or cheap domains to lure new customers in. However, it’s not necessary to register a domain and host a website with the same company, and shopping around online for each independently can yield some good deals.
Prices to register local domain names vary widely between registration companies - even though all are simply selling the same rights to use the .co.za address.
There are dozens of domain registration companies in South Africa, and many international companies such as GoDaddy, Google Domains, and NameCheap also allow for local registration of some domains. But in most cases, it’s still cheaper and easier to use a local domain registration company to register a website address.
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