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Yes, and it is very common. Nothing is FREE, if you get FREE DNS you are paying for it in your monthly bill and/or you are getting a poor service.
The better the DNS... UltraDNS provide a lot of services. Look at the Penthouse, Playboy and you will see that they pay for DNS services.
I'm at the moment talking to someone that only offers 10 FREE domains, and as a secondary DNS service, not even as a primary, but they are giving me a full gig of transit at prices which can only be attained at the 10gig mark.
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