Question to Japan Registry Services Co., Ltd. (JPRS)

Hello Everyone.

I am writing today as I have strong doubts about the recent decisions rendered by JPRS – the entity with the exclusive rights to manage “.JP”.

I can not help but feel that the current wholesale price together with their newly planned actions will bring negative consequences on the future of Internet in Japan.


Your consideration of this issue would be appreciated.

Cumulatively there are 1.18 million “.JP” domains. New registrations and renewals generate a yearly revenue of 3.5 billion yen. After tax profit is around 300 million yen and earned surplus is now over 2 billion yen. JPRS pays 10% as dividends to stockholders (we hold a minor share) including the managing board. They also have an office in a beautiful building in the city.

Incidentally, “.JP” is over 5 times as expensive as the most popular ccTLD.

When a company with an 8 digit profit chooses to give back only to its stockholders through dividends, but not to its users through cheaper prices, I have difficulty understanding their mentality.

It raises a question; are we buying expensive domains because of monopolies like JPRS whose pricing strategy is aimed at benefitting certain individuals?

We at GMO have sold more domains in Japan than anyone else.
We know the effect that price has on number of registrations.

In short, from our experience, expensive domains simply do not sell well.

Let me give you an example; “.DE” (ccTLD for Germany) has over 14 million registrations, or 10 times that of Japan. In terms of the number of domains registered, “.JP” is only 16th amongst all ccTLDs. In relation to the population or the size of the economy, the figure is very low.

As I always say, Number of Domains = Number of Websites = Amount of Data on the Internet.

In other words, I am sincerely concerned that the high price of “.JP” domains will hinder the growth and expansion of the Internet in Japan.

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But that’s not all.
What JPRS is trying to do, is use its authoritative position against businesses like us who have competed fairly in the market and supported the growth of “.JP” for all these years.

I personally do not enjoy getting in the way of others’ decisions, let alone writing about them on my blog.

However, though I have tried numerous times to get a hold of the president of JPRS, Mr. Higashida, I have been told that he is “too busy” and hence will not be able to take any calls for the next 2 weeks.

Therefore, as a man who worries about the future of the Internet in Japan, I have no choice, but
to ask in the form of an open question to JPRS and the public the following:

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Since its establishment in December 2000, Japan Registry Services, Co., Ltd. (JPRS) has managed “.JP” as appointed by JPNIC. In 2002, with the official endorsement of the government, JPRS signed a registry agreement with ICANN for the management of “.JP” which is sold by hundreds of designated businesses, including JP Direct, the entity through which JPRS sells domains directly to users.

Becoming the registry for a ccTLD uniquely allocated to a country, means bearing the responsibility of managing a common asset, while being granted the exclusive rights to operate and manage the domain.

During the designated sellers meeting held on October 19, JPRS announced plans to start selling gTLDs such as “.com” and “.net”. Registrars who wish to sell gTLDs are required to attain ICANN accreditation. In Japan, there are over 10 businesses that have been accredited to sell gTLDs.

Here are the issues I would like to point out regarding the actions of JPRS:

・JPRS is trying to use its position as exclusive provider of “.JP”, a common asset of the people of Japan to sell gTLDs.

・By becoming a registrar of gTLDs, JPRS not only deviates from its purpose of incorporation which is to “give back to the community through JP domains and DNS technology”, but becomes a competitor against entities that have worked to support the growth of ”.JP”.

・Selling gTLDs is an act that would be counterproductive to the growth of “.JP”.

In a letter sent to IANA by The Ministry of Posts when JPRS was appointed the managing body of “.JP”, it says that ”JPRS has been established against a backdrop of sweeping changes to the environment surrounding the ”.JP” top level domain such as rapid Internet development and the intensification of competition within Japan between the “.JP” top level domain and gTLDs such” In other words, JPRS recognizes in the letter that gTLDs are competitors of “.JP,” and that JPRS was established in order to promote growth of “.JP”.

・JPRS did not consult with major partners, nor reveal to them when they earned ICANN accreditation.

When JPRS was accredited by ICANN in November 2009, they did not reveal this fact at all. In fact, when they were asked of their intentions after some found out through ICANN, their response was that “JPRS became an ICANN accredited registrar in order to study the systems and policies of other domains, but has no intention whatsoever of selling gTLDs in the future.”

I myself also heard from President Higashida when he visited our office on March 5, that it was for “research” purposes, and that they had no intentions or plans to provide gTLDs to its customers.

On top of this, there is no record that there were prior meetings regarding the matter at the JP Domain Name Advisory Committee which was formed to maintain equality and neutrality of “.JP”. From what I understand, there are no records of meetings held at JPNIC either.

In the letter between the Japanese Government and ICANN at the time of agreement between ICANN and JPRS, it states that the government and JPNIC will work together to keep “.JP” a public interest. Can we assume therefore that the recent actions taken by JPRS have indeed been reported as well as acknowledged by the government and JPNIC?

Currently, there are no ICANN rules that prohibit the sale of gTLDs by the registry of a ccTLD. However the way in which JPRS has decided to “take advantage” of its position to sell gTLDs against businesses that have supported the growth of “.JP”, is something that worries me.

I hope that the managing board of JPRS will take this into serious consideration, and render the proper decision for the growth of Japanese domains (which impacts the growth of Internet in Japan). Having said all that, I ask the board of JPRS to share their thoughts on how they regard this matter as members of the management.