What is a domain name? A domain name is a unique name, kind of like an e-mail address is unique, which is registered in a database called WHOIS through an organization called Network Solutions, Inc. (NSI). The domain name corresponds to a unique set of numbers called an IP (Internet Protocol) address. The reason we use domain names instead of IP addresses is that they are closer to our language. It would be difficult to market a site like this: “Go to 126.96.36.199 or 188.8.131.52 to search the internet!” A much easier way to do this is to say “Go to http://www.Google.com or http://www.yahoo.com to search the internet!” (Both Google and Yahoo are trade marked by Google, Inc., and Yahoo, Inc., respectively).
A domain name points to a computer called a “name server”. The name server knows that your domain name corresponds to your web hosting server’s IP address and it routes the person who typed in your domain name to your web hosting server – to your web site. That is how people anywhere in the world can see your web site by typing your domain name.
In 1992, the National Science Foundation granted an exclusive contract to NSI to be the sole registrar of top level domain names. NSI also had a cooperative agreement with United States Department of Commerce (“DoC”). With no competition, consumers were at the mercy of NSI.
In 1998, NSI and the DoC amended their cooperative agreement to allow for competing registrars. NSI was forced to provide domain name registration to the competing registrars at wholesale prices, rather than the standard $34.99 annual fee. NSI still charges $34.99 per year.
In late 1998, the DoC assigned the responsibility of overseeing the transition to a competitive market for domain names and accreditation of new registrars to a new organization called the Internet Corporation for Assigned Names and Numbers (ICANN).
In 1999, ICANN began taking applications from companies who wanted to become registrars – and then capitalism took over: companies had to compete for business. Prices came down and service improved, however some are better than others. For a more detailed history of this transition, visit http://www.icann.org/registrars/accreditation-history.htm.
Even with the positive effects of competition in the domain name marketplace, the process of internet domain name registration remains a mystery for many.
There are a lot of companies that want to charge you hundreds of dollars to do the simple task of domain name registration for you. There are some registration companies who will charge you $35 just to register a domain. And there are web site consultants who charge over $100 to do the work for you. But you can do it yourself in about 15 minutes and it can cost as little as $1.99 for a year. If you do some research, learn a little and work smart, you can save yourself some money – and some headaches.