In an article by stock analysis site, Trefis, which bills itself as a site that “helps you understand how company’s products impact its stock price“, said today that VeriSign “is on the verge of losing an antitrust lawsuit filed by Coalition For ICANN Transparency (CFIT), a non-profit organization that represents website owners.”
“A CFIT victory would attract new players to the market, creating competition and forcing domain name prices down. While good for domain name owners, this scenario would pummel Verisign’s stock value.”
“”We estimate that the .com and .net registry business contributes around 55% of $36 Trefis price estimate for Verisign’s stock. Verisign’s average fee for domain name registration has increased from around $5.20 in 2006 to $6.40 in 2009. If Verisign maintains its monopoly position, we would expect the average registration fee to reach $8.50 by the end of the Trefis forecast period.””
“However, if VeriSign loses the case against the CFIT, competitors will enter the market and drive registration prices down.”
“There could be a downside of around 20% to the $36 Trefis price estimate for Verisign’s stock if domain registration prices remain constant rather than increasing as we forecast.”
Good news ahead for domain owners. If the CFIT case is successful Wall Street agrees that prices on domain registrations and renewals will have to come down.