Official assignment

ICANN (Internet Corporation for Assigned Names and Numbers) has overall responsibility for managing the DNS. It controls the root domain, delegating control over each TLD to a domain name registry. For ccTLDs, the domain registry is typically controlled by the government of that country. ICANN has a consultation role in these domain registries but is in no position to regulate the terms and conditions of how a domain name is allocated or who allocates it in each of these country-level domain registries. On the other hand, generic top-level domains (gTLDs) are governed directly under ICANN, which means all terms and conditions are defined by ICANN with the cooperation of each gTLD registry.

Domain names are often seen as being similar to real estate in that (1) domain names are virtual properties on which a website (like a house or commercial building) can be built and (2) the highest quality domain names, like sought-after real estate, tend to carry significant value, usually due to their online brand-building potential, use in advertising, search engine optimization, etc.

A few companies have offered low-cost, below-cost or even free domain registrations, with a variety of models adopted to recoup the costs to the provider. These usually require that domains be hosted on their website within a framework or portal that includes advertising wrapped around the domain holder's content, revenue from which allows the provider to recoup the costs. Domain registrations were free of charge when the DNS was new. A domain holder (often referred to as a domain owner) can generally give away or sell infinite subdomains on their domain name. For example, the owner of example.edu could provide subdomains such as foo.example.edu and foo.bar.example.edu to interested parties.