I like the idea of namecoin -- uncensorability is pretty cool from a technological standpoint -- however the other flaws of bitcoin make me wary of basing any sort of serious DNS replacement on it. Given that there's no plans to increase the number of namecoins in circulation, and that creating a domain by its very definition destroys namecoins, that 50nmc cost to buy a domain becomes increasingly expensive over time as people buy namecoins, peoples' wallets get lost, fraud occurs, etc. I'd be more interested if they did something like dogecoin and reated some sort of inflationary method to counteract this, so that we don't end up with the same mess DNS is in, only with slightly different bad actors.
There are a whole host of problems introduced by price-fixing which go way beyond running out of supply. We definitely need DNS on a blockchain, but Namecoin won't do it.
Namecoin is not controlled by anyone in particular. If it grows in demand and people want the inflationary feature (or anything else), it will be implemented by the network.
If the money supply is fixed, then people will have a harder time acquiring namecoin after all the namecoin is generated. People will have to buy it, and since it's a scarce resource, it may become extremely expensive. Especially if namecoin exploded in popularity.
I suppose if it becomes expensive then the namecoin admins could lower the cost of database inserts/updates. But it seems like that would prompt the price per namecoin to rise accordingly, because the value of namecoin is a single database insert or update.
It's only 0.01 NMC to buy a domain (plus a 0.005 transaction fee). The easy solution to the fixed-supply issue is that this registration fee could change by blockchain consensus if NMC started to become too scarce.
That said, I actually think the BitShares Domains model is a better fit for name registration: treat each domain like real estate, putting it up to the highest bidder (which makes squatting expensive). However, BTS Domains is probably a year away at least.
In either case, the most significant bit is browser/OS adoption. At the moment, not a single browser (even Firefox) supports .bit domains, except through plugins.
My understanding is that BTS domains are owned for life (like .bit domains, which must be renewed, but at no cost), but it is up for auction for a fixed window of time after the first bid starts.
However, at the moment it's purely in the planning stages.
