Why aren’t domains free?

Many people are curious, why domain names are not free. What do we need to pay for when the Internet is a free network with no bounds? The fact of necessary yearly payments is even more depressing. In this article we will try to explain, why owners should pay for their domains and reveal astonishing fact that paying for a domain, you do not actually become its owner.

What is a domain name? Simply saying, domain is the address of your website. Imagine that your website is an apartment where you live. The content of your website is your furniture and other belongings, and a domain is just an address pointer that tells your friends where they can find you. Let us see now how this system appeared.

Historical aspects of domains

Everything started back in 1969, when Department of Defense of the United States funded creation of the first computer network that was named ARPANET. It was created for internal purposes of the militaries and used TCP/IP protocols that were specially developed for this occasion by two computer scientist, Vinton Cerf and Robert Kahn. Every computer in the network had some numerical address that, of course, was hard to remember. That is why hosts.txt file was created. It contained a list of intelligible names where each name was assigned to some numerical name of a networked computer.

Host.txt file was maintained by Stanford Research Institute that took part in the project. They transmitted the file to every computer in the ARPANET, which finally evolved to the modern Internet we know. Year by year the Internet was growing rapidly and it became too hard to maintain one simple file with all the network addresses.

As a result Domain Name System was invented. This special automated system acquired functions of hosts.txt file; it mapped understandable domain names to their numerical addresses. The DNS system is crucial, without it domains would lead nowhere. This mostly explains why people should pay for domains; basically you do not pay for any particular domain, you pay for the maintenance of the existing infrastructure, you pay for the servers where DNS and other systems are located. This is the ideal picture of what is going on in the real world, but why prices differ so much? To understand it you need to get familiar with the whole system.

ICANN is in charge of everything

ICANN, the Internet Corporation for Assigned Names and Numbers, was created in 1998 to manage the system of domain names in the expanding Internet. ICANN is a regulatory body that supervises all the market players listed below.

The Registry is a special entity that manages some Top Level Domain (TLD). For example, such TLDs as. com and .net are maintained by VeriSign Inc; Public Interest Registry is in charge for .org TLD; Afilias Limited manages .info TLD. There are also a lot of other registries; the full list of them can be found at ICANN  web site. We just mentioned only generic top-level domains here, but there are also sponsored top-level domains (e.g. .asia, .edu, .gov, .sex, .xxx) and country-code top-level domains (e.g. .us, .uk, .fr, etc.). Every TLD has a registry that manages it and is responsible for the servers required for stable work of all domains of this TLD. All registries should be accredited by ICANN to be able to sell domains of different TLDs. But you can’t actually buy a domain from a registry and we will explain why later in the text.

The registrant is a person or an organization that registers a domain for a particular period of time (1 – 10 years). Registration period is fixed; you cannot register a domain for more than 10 years at one time. This means that you do not actually own a domain; you just rent it from a registry that already owns all domains with such TLD. But the good news is you can always extend your contract and nothing can prevent you from doing it. You can do it forever, so it looks like that you actually own a domain. You can also sell your contract to anyone else, but if you forget to renew, you will actually lose your domain and it will become available for registration again.

The registrar is a company that buys domains from registries and resells them to registrants. Different registrars may have different prices for the same domain names. It happens because a registrar can decide what amount to charge for a domain. Price may also vary because almost all registrars offer also a big variety of extra services that usually come with domains. These services can be email forwarding, simple parking page, WHOIS protection, URL forwarding, etc. By the way, all these services are included when you buy a domain from DomainName.com, and you do not have to pay any extra fee for them. You can see detailed information of what people get with domains in our FAQ section.

Registrars can cooperate with many registries and offer as many TLDs as they want. You can buy a popular domain only from some registrar, because big registries do not deal with registrants directly. But you can actually get such domains as .co and .ws omitting the registrars. Of course, the fact that you can’t communicate with the registry directly increases the final price.

So whom are people actually paying to?

As you understood from the article, the sum you pay gets divided between all the participants of domain market. Some of your money goes to support ICANN, which is a non-profit and regulatory organization. Another part goes to the registry of a chosen TLD. And, of course, probably the biggest part goes to your registrar, because registrar is the only organization where you can get a domain.

When you buy a hosting account, you pay for the uptime guarantee of your server, no matter if you have any content there or not. The same for domain names; you pay for a domain ability to lead to some address you choose, and it also does not matter, whether it is valid or not.  Registries play big roles, but the only way to communicate with the registry is finding a reputable registrar that suits you best.

Unfortunately, we can’t offer you free domains, but we can assure you that you will receive reliable service and caring customer support in DomainName company. Do not hesitate and find your perfect domain now.

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  • josh

    It is very difficult to find a cool domain name for your company as most of them are already taken

    • https://www.domainname.com/ Tarnman

      Hello Josh, thanks for your feedback.

      Feel free to read our upcoming article about creating and registering a nice and sound .com domain name. You are always welcome!

  • BA

    You contradicted yourself explaining this. You said that you can not OWN a domain name, that you just rent it, but you also said that you are renting if from the REGISTRY that OWNS it. Why do they get to own domains ? You just said nobody can own one. Why can’t I be a registry or registrar ? Where do they buy them, or do they just “rent” them. Is everyone just renting? Your explanation does not make sense.

    • DomainNameCom

      Thank you for your comment. We just wanted to say that you own a domain as long as you pay for it.

      When a domain name expires, it becomes available for registration again and can be acquired by anybody through any registrar that offers this particular TLD.

      This article explains how one can become a Registrar:

      https://www.icann.org/resources/pages/accreditation-2012-02-25-en

  • Syed Shabir Jan

    For a domain $3/year mean every month or once in a year?