Today’s round-up has good and bad monopoly-related news. But I thought I’d start by discussing how current government officials are accommodating the incoming Trump administration, not in flashy or high-profile places, but in the shadows, where only monied interests are paying attention.

In June, I pointed out there are a set of companies called “economic termites,” which are “instances of monopolization big enough to make investors a huge amount of money, but not noticeable enough for most of us. An individual termite isn’t big enough to matter, but the existence of a termite is extremely bad news, because it means there are others. Add enough of them up, and you get our modern economic experience.”

One of those termites is called Verisign, and it’s the company that manages the database of .com names due to a government monopoly charter that is shortly up for renewal. When I register TheBigNewsletter.com every year, for instance, I pay around $10, and that money goes to Verisign. There are resellers so it can get a little more complex, but that’s the gist.

At 159 million domain names, that’s about a billion and a half dollars in annual revenue for Verisign, with a gross profit margin of 90%. Trump’s win has changed the calculus among certain government bureaucrats to increase that firm’s gross profit margins.

Here’s how I characterized it in June:

A few years ago, the price to renew a .com domain was $6 a year. Then $7. Then $8. Verisign has hiked prices every year, up to the maximum set by the government (until Trump removed the price cap altogether in 2018.)

Today, Verisign is the single most profitable company in the stock market, a great example of an economic termite. In 2013, its operating margins were 54.7%, by 2023 they grew to a crazy 67.1%. Verisign doesn’t invest this money; in 2023, it spent $882 million of it on stock buybacks. Its expenses are basically running a simple database, its strategy is to hike prices just below what will be noticed, and its method is to have politically connected people like Clinton Justice Department official Jamie Gorelick - who is one of Merrick Garland’s good friends - on its board.

Where did Verisign’s monopoly come from? Well, it was due to the last four administrations choosing to ‘privatize’ domain registration to a ‘multi-stakeholder group,’ the Internet Corporation for Assigned Names and Numbers (ICANN), which has a deal with Verisign to allow it to maintain the monopoly. ICAAN could at any point put the contract out on domain management for bid, and you’d see corporations come in at $2/year, certainly much less than $10.26. But they haven’t ever done that. Their contract strikes me as unlawful, a straightforward agreement in ‘restraint of trade.’ Yet, Verisign has a weird agreement with U.S. government’s National Telecommunications Information Administration (NTIA), which is widely perceived to provide the firm with legal cover for its clearly monopolistic behavior.

In less than three months, the NTIA, which is run by former Google lobbyist Alan Davidson, has a choice of whether to renew its agreement with Verisign. I don’t know what Davidson will decide.

Now, since I wrote my piece, there’s been reporting on a conflict between the NTIA and the Antitrust Division over how aggressive to be in negotiating with Verisign. According to the Capitol Forum, the NTIA had ignored its original competition mandate and was seeking to renew the contract without any limits. But the Antitrust Division put their foot down, and they were going to force Verisign to cut its price, or even rebid the contract.

The backstory is that there always had been a price cap, because the NTIA had a competition mandate it has come to ignore. But in 2018, the Trump administration signed a deal with Verisign that removed it, because the Antitrust chief, Makan Delrahim, was ideologically opposed to public price setting, and also argued that domain names were irrelevant in an age of apps. Of course that type of thinking doesn’t make sense for a government-chartered monopoly like the .COM database, but sloppy thinking is how economic termites often flourish.

Now that Trump won, allies of Verisign in the NTIA are using the election to suggest they should stop negotiating aggressively with Verisign on the contract renewal, assuming Trump will just reverse it when he takes office. Senator Elizabeth Warren and Rep. Jerry Nadler are demanding a crackdown nonetheless.

All that said, it’s not clear that the new Trump administration is going to be like the old one in terms of tolerance for this kind of government-facilitated graft. The right has done a fair amount of intellectual work on the problem of corporate power, and this monopoly, since it’s straight-up government granted and tends to benefit Democrats like Warren Buffett and Jamie Gorelick, should be in the crosshairs. But that’s not, apparently, what people at the NTIA think.

Does this particular corporation matter? Well, it’s a billion and a half dollars a year, so it’s not trivial. But more importantly, multiply this kind of thinking across every agency in a Federal government that structures a $25 trillion economy, and soon you’re talking real money.

And now, the good and bad news of the week.