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December 15, 2006

Cheap Domains Registrations : Google for $10 or Godaddy for $8.95?

posted by MR WAVETHEORY at 12/15/2006 03:18:00 PM
Google Inc. (Nasdaq GOOG) has entered the domain name registration business in partnership with GoDaddy and Enom. Based on my usage of the site, Google is basically shipping domain name orders to enom or GoDaddy using a some predetermined algorithm - may random number generator? Here are the highlights of the deal.

1) Google charges much more for their domains and you are better off just registering them directly with GoDaddy or eNom.
While GoDaddy sells domains for $8.95 and as low as $6.75 per month for power users, Google is charging $10 which is a premium price point. I don't think this will do, because registering a domain is as easy as typing in a word and pressing buy. They are selling a commodity product at a much higher than market price which makes no sense.

GoDaddy charges $8.95/year for a .com domain registration and it comes with Webmail, DNS, a basic home page. If you register with GoDaddy, then you can just point your DNS to Google and then it will work with Google Apps for your domain.

Enom charges $6.95 for volume buyers and $8.95 for high volume buyers. Same shtick here.

2) How much would Google earn per domain name registration with GoDaddy or eNom?
Enom's premier rate is $6.95 per year. Google probably gets a better rate, but let's assume it's $6.95, then Google makes $3.05 per registration. That's a great margin!

GoDaddy's bulk registration rate is $6.65 for those who register more than 101 domains at a time. That means Google makes $3.35 per registration. Also a nice margin.

My guess is that the preferred rate that Google receives is closer to $6 per domain name registration.

3) Google has no lock in on why consumers should buy domains from them.
Google Apps for Your Domain works with domains from any registrar. If Google Apps for your Domain only worked if you purchased your domain from Google, that would be a different story. However, that's not the case. So, why pay $1-3 more to Google?

4) Google announcement is bad news for Verisign, Inc. (Nasdaq VRSN).
Verisign is already under attack from every single direction. Verisign owns Network Solutions and they still charge an exorbitant $34.99 per domain name registration. I find no reason why this business doesn't get crushed by Google. We love you Network Solutions, but you really need to change with the times.

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