The costs are known, the competition is high, the margins are low. You still have to deal with support/abuse. There is no real “high volume customer”.

There’s a lot of contractual obligations and edge cases in domain names, and a lot of potential for fraud and disputes. It’s a business with high legal fees.

Also how domains should be managed evolves with time. For example GDPR has a huge impact on WHOIS, especially since the ICANN took so much time to acknowledge that in their specs, so there was a time where it was impossible for a registrar to be compliant with GDPR and ICANN rules. It’s still not 100% clear how it’ll be handled by RDAP (future successor of WHOIS)

And last but not least, some registries for ccTLDs are real pains in the ass to work with, and won’t hesitate to slap you with big fines if you make any mistake.