Is free DNS a good deal for business?

It's been almost a year since Google announced its free DNS service known as Google Public DNS, promising a speedier, safer way to surf the Web and sparking concern that Google would become the dominant DNS provider for ISPs and other large network operators.

These worries appear unfounded.

Google has been quiet about its Public DNS Service since it was announced in December 2009, still referring to it as "an experimental launch" on its Web site. Google's silence has led some of its competitors to wonder aloud about whatever happened to the search giant's foray into DNS services.

"We don't compete with Google DNS," says David Ulevitch, founder and CEO of OpenDNS, a leading provider of free and paid DNS services for consumers and businesses. "Just another failed Google project maybe?...It got us some broader awareness during the announcement. Nothing negative at all. And nothing since."

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"We don't really come across Google," says Richard Hyatt, cofounder and CTO of BlueCat Networks, which sells DNS appliances. "Our customers are large enterprises or government agencies. They are not outsourcing their DNS traffic at the moment…Would they ever outsource their DNS to Google? I don't think so."

With Public DNS, Google entered a market already populated by other free DNS services such as OpenDNS, DynDNS and NeuStar's Ultra DNS Advantage.

Often supported by advertising, these free services handle what's called recursive DNS, which lets end users surf the Web by typing domain names into their browsers and translating them into the corresponding IP addresses.

The free services don't support external DNS, which is how a Web site publishes the latest information about its DNS and IP address changes to its customers over the Internet. Nor do they include the DNS services that companies run on their internal networks, which is an area dominated by special-purpose appliances and software.

While aimed at home and small business users, free recursive DNS services have attracted some companies and school districts.

Increasingly, however, businesses are opting for premium, paid recursive DNS services without ads and with additional security features such as Web content filtering rather than the free alternatives

Ulevitch is reporting a bigger push by corporations to purchase the paid enterprise version of his company's service, known as OpenDNS Enterprise. Since its release in October 2009, OpenDNS Enterprise has attracted nearly 1,000 enterprises including two global 50 corporations.

"Adoption of our enterprise service [is] growing dramatically," Ulevitch says, pointing out that many companies try the free version of OpenDNS and then migrate to the paid Enterprise version. He cites "an astonishing 98 per cent" renewal rate."

Ulevitch says OpenDNS is getting half of its revenues from the Enterprise version, even though it's only a year old.

"It's been far more successful than we ever imagined," he says. "That said, we will always support and grow our free version. It's our base. It's a great service, and it generates a substantial amount of revenue each year, which helps fund our operations."

OpenDNS is expanding its paid offerings. On Nov. 1, OpenDNS launched a program for managed service providers that allows them to co-brand a fully managed version of OpenDNS. "Based on the demand we see and early sales numbers, it will be a breakaway success on its own," Ulevitch predicts.

NeuStar is seeing significant growth for its free Ultra DNS Advantage service -- but among consumers, not businesses.

"We see steady usage and growth based on query volume, which means more people are continuing to use our free service," says John Crotty, senior product manager of Internet Infrastructure Services at NeuStar. "We estimate that there are over 500,000 users regularly using DNS Advantage."

NeuStar sees just as much momentum for its Ultra Internet Gateway, a paid cloud-based managed service aimed at enterprise customers. NeuStar has added the ability to block or warn users of prohibited content on their network, such as known malware or phishing domains.

"We see an increase in demand from enterprises seeking solutions to outsource their recursive DNS infrastructure and leverage our managed services solution, providing them with content filtering, fast and reliable recursive DNS," Crotty says.

Crotty says consumers are accustomed to free DNS services through their ISPs, but that they are willing to switch to an alternative service such as DNS Advantage if it is faster or more reliable. He doesn't think enterprises will move to a free model for recursive DNS because they will want added features and service-level agreements.

"Enterprises focus on quality, control, security and reliability, and may be less concerned with free, but focused on cost-effective solutions that require reduced internal costs," Crotty says.

Jeremy Hitchcock, CEOof DynDNS, says 7.5 per cent of the customers of his firm's enterprise-grade Dynect service previously used the company's free DynDNS service. DynDNS is a unicast service with minimal support that is hosted at five data centers worldwide. Dynect, on the other hand, is an anycast service with service-level agreements, load-balancing and disaster-recovery tools that is housed at 17 data centers worldwide.

"The comparison between free [and] enterprise is not really possible in an apples to apples…view," Hitchcock says.

On the horizon for free, recursive DNS services is how they will be affected by the imminent rollout of new DNS security mechanisms known as DNSSEC, which adds a layer of encryption to verify DNS look-ups.

"One of the parts of the free recursive DNS services is that if you were looking for Coca-Cola but you typed it in wrong, they send you to guide pages. They make money out of that with Google AdWords," Hyatt explains. "But with DNSSEC, you can't really do that redirection…There's a big debate about whether you want the DNSSEC response to go to the desktop or the recursive server."

NeuStar, for example, says it has beefed up its DNS Advantage service to handle DNSSEC, which is likely to take off early next year  when it is supported by VeriSign in the .com and .net domains.

Another issue is IPv6, the long-anticipated upgrade to the Internet's main communications protocol, which supports dramatically longer IP addresses: 128 bits, instead of the 32 bits used by IPv4, the current version.

"I don't think all the network operators are ready to move over to IPv6," Hyatt adds. "I don't think people have the IP address management figured out. Spreadsheets and homegrown tools won't cut it….I think that's going to be the pain point for corporations."

For now, providers of free and premium DNS services seem unfazed by Google's presence in the market.

"The best thing about Google entering the market is attention -- it greatly reinforces the vital role DNS plays in making the Internet fast," Crotty says.

Adds BlueCat's Hyatt: "The fact that you brought up Google Public DNS today is the first time it's come up for a year."

Read more about lan and wan in Network World's LAN & WAN section.

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Carolyn Duffy Marsan

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