Seriously? A mini-rush to save a bloody dime?
That said, it seems nearly suicidal for a registrar to be raising prices at _all_ when there's enormous competition in the industry and so much downward pricing preasure. Tucows service has been nice, but I think we'll be moving on to a new registrar where we can save some real money. A 30 to 50% difference in cost is something we can no longer ignore.
----- Original Message ----- From: "George Kirikos" <[EMAIL PROTECTED]>
To: <[EMAIL PROTECTED]>
Sent: Tuesday, November 23, 2004 1:05 PM
Subject: Re: wholesale pricing impacts
Hello,
Since the price increase doesn't take effect for a few days, and we're allowed to renew domains early, we should see a mini-rush of renewals on the day before the price increases by smart investors. It's kind of like when the TTC (Toronto public transit system) announces a price increase for tokens -- it makes sense to invest in them before the price increase.
The size of the increase is 1%. If your opportunity costs (alternative similiar risk-free investments) are 2% per year (realistic under current interest rates in Canada/US), for example, then it takes 6 months to earn 1% of your original investments. Thus, you should renew 6 months' worth of domains early (assuming simple linear interest, no compounding).
Roughly speaking, mathematically, if your opportunity cost of funds is C (e.g. C = 0.02 for 2%, 0.05 for 5%, etc.), then you should renew:
0.01/C * years in advance.
C = 1% ---> a full year of renewals in advance C = 2% ---> 1/2 years worth of renewals in advance C = 4% ---> 3 months worth of renewals in advance
Since it's only a 1% price increase, TTC tokens might be the better investment (those often go up 4 or 5%!). ;)
Sincerely,
George Kirikos
http://www.kirikos.com/
