Nonetheless your objection was that this proposal somehow would not distribute resources in accordance with policy, I think your objection was addressed completely.
You are certainly correct that my initial objection was unclear. Specifically, I do not believe that this policy is compatible with section 4.2 of the PDP process, nor 4.3 as of this moment. Compliance with the NRPM would seem to be irrelevant since the policy proposal would change the NRPM.

You are drifting. I never made the argument you are saying I made regarding any benefit of leasing to RIPE. I said in response to Noah, and you now agree, that allowing leasing will not in fact lead to the demise of an RIR. I take it you agree that Noah's objection in this regard has been addressed.
You are the one who opened the door to the RIPE situation, although I would have certainly cited the research from my first email regardless. Although you may have addressed the extreme example brought up by Noah, you have failed to address any of the concerns I have raised about the results of the RIPE policy. If I've put words in your mouth, I apologize. However, I am asking you directly to address whether you consider the policy implementation in RIPE to have been beneficial to the Internet community, both in the region and as a whole, because I would argue the data says otherwise.

OK the waiting list is rock solid, but my wisp needs a /21, what now? My point remains, the waiting list is not appropriate for all those in need, and if there were alternatives then there would be no market for leases to begin with. I can spend all day giving examples of legitimate lessees. I think you should concede that there are legitimate business cases where leases make more sense for the recipient.

The waiting list may not be appropriate for all needs, but it certainly fills in many of the gaps you are arguing necessitate leasing. The edge cases you note may make for a compelling argument for expanding wait list eligibility, but I don't find them compelling enough to justify a RIR-wide policy change to allow leased addresses to be considered as justification, a policy which has the potential for considerable negative side effects to the community. The existence of a market for leasing does not equate to a necessity for the ARIN community to enable and subsidize the practice by changing policy in this way. I would certainly concede that legitimate business cases for leasing IPv4 do exist. Unfortunately, there is a dearth of reputable research into the leasing market, so I will refrain from making any assertions about the proportion of legitimate to non-legitimate use cases. Regardless, the existence of legitimate use cases doesn't strike me as a compelling reason to support this policy.

I believe you have conceded that my assertion is correct.

With regards to your assertions about the composition of the pool of lessors, I would agree that you are correct. I do not concede or agree in any way that your assertion supports implementation of this particular policy. I do not support the concept of LIRs acquiring new space solely to lease off-network, and I would prefer that the pool available for leasing off-network dwindles over time until as much space as possible can be brought under terms that explicitly disallow the practice. For networks smaller than /20, the waiting list provides an acceptable alternative and it appears that the current rate of revocations is approximately matched to the demand on the waiting list, for networks larger than /20, I assert that what you propose would only exacerbate the difficulty of obtaining a block at a reasonable price.

That is the current policy, to disallow justification without a circuit, so  your objection to this proposal means you prefer no leasing policy.

You are correct here, I certainly prefer a no leasing policy, specifically one that is stronger than the current policy, but I still prefer the current policy to what you propose. I do not believe it is legally or economically feasible for ARIN to retroactively reclaim resources that are currently being leased off-network, but I don't consider anything you've presented here as a compelling argument to officially sanction the practice regardless of the historical inequalities.

I consider this also a concession that what I said is true about "providing an incentive" which is as far as I went.

You're going to need to go further if you want to garner any significant community support for this proposal.

I agree with your first contention, that this policy could in fact lead to price increases on the transfer market. But the basic math you refer to is the linkage between the transfer market and the lease market. Transfer prices have doubled this year, lease rates have not doubled, they haven't risen anywhere nearly as quickly. I think the lack of ability to purchase blocks to feed the lease market in ARIN serves to loosen that coupling between the lease and transfer market. Thanks for phrasing it as "if networks choose to lease", as that is a clear understanding of the way things work currently. Lessors and lessees are choosing to engage in leasing because they both see an advantage. So let me admit my assertion that lease rates would drop with this policy is just an assumption and not an assertion.

I would agree with your assertion that the linkage between the transfer market and the leasing market is loose. I expect that there will be a corresponding increase in lease prices over time. If you have any historical data to contradict that expectation, I'd certainly be open to hearing it. If networks choose to lease when there are alternatives available, I am unconcerned if they must pay more, even significantly more in the far flung future when the leasing pool has dwindled, because that is the price they are choosing to pay for the flexibility associated with a lease.

Thanks, I think we understand that you do not support the policy but I don't think that you overcame my assertion this time. Because currently there is no "justification benefit" for accurate registration, but this policy would create one.

I don't understand what you are asserting here. There is currently a requirement to accurately report re-allocations. The only benefit I see is to networks that are currently non-compliant with that policy. If networks are failing to meet those obligations, I would argue a better policy proposal would be one to strengthen the penalties related to non-compliance with that policy, rather than rewarding non-complaint networks.

- Isaiah

On 9/21/2021 6:17 PM, Mike Burns wrote:
Hi Isaiah,

Thanks, replies inline.



---- On Tue, 21 Sep 2021 18:56:05 -0400 *Isaiah Olson <[email protected]>* wrote ----

    Hi Mike,

    Thanks for your reply. I would be happy to address each of your
    assertions.

    > That RIPE situation is an unfortunate artifact of their reserve
    pool
    > for new entrants.
    >
    > Can you share the percent of those /24s that begin with 185?
    Roughly 17% of the RIPE IP space that I have on my list comes from
    that
    block. I would hardly agree that the statistically significant
    disparity
    in transfer market abuse activity across all RIPE IP ranges is
    solely an
    artifact of this single block.

    > First you wrote “The onus is not on ARIN to sanctify practices that
    > some are already engaging in, but rather to distribute number
    > resources in accordance with community developed policy.”
    >
    > My answer is that this policy proposal continues to distribute
    number
    > resources in accordance with community developed policy.
    It will be community policy if and when it is adopted through this
    PDP,
    which seems unlikely at this point since you are the only person
    arguing
    in favor and I don't find your arguments particularly convincing
    since
    they are not backed up by any hard data. Whether the policy comports
    with the goals of the PDP itself is a different question.


    Mike-Nonetheless your objection was that this proposal somehow
    would not distribute resources in accordance with policy, I think
    your objection was addressed completely.

    > I would agree with you, but that doesn’t mean we should ignore
    > relevant data from our sister registry, and I brought up RIPE to
    deal
    > with Noah’s objection about what will happen should this policy
    pass
    What relevant data have you provided from RIPE which justifies your
    initial assertion? Certainly you may have rejected Noah's concern
    that
    the RIR would collapse, given the fact that RIPE still exists, but I
    haven't seen any compelling data cited here that shows any benefit to
    the RIPE community due to their policy and I have provided data which
    shows quite the opposite. A lack of immediate negative effects is
    hardly
    sufficient data to declare that RIPE policy hasn't caused negative
    long
    term effects, of which we may not have yet seen the full impact.


    Mike-You are drifting. I never made the argument you are saying I
    made regarding any benefit of leasing to RIPE.
    I said in response to Noah, and you now agree, that allowing
    leasing will not in fact lead to the demise of an RIR.
    I take it you agree that Noah's objection in this regard has been
    addressed.




    > Then you won’t have to worry about leasing, because you claim
    there is
    > no market for it. The waiting list is not a guaranty, and has an
    > unpredictable schedule for address delivery. I gave an example of a
    > WISP seeking to try out a new area, and why leasing addresses
    might be
    > quite attractive to that WISP for entirely legitimate reasons.
    I would not consider the current waiting list distributions
    unpredictable, in fact I would argue it's quite the opposite in
    practice. Speaking from personal experience on the waiting list
    before
    ARIN moved to quarterly distributions, I waited only four months to
    receive a block. Under the last several quarterly distributions,
    nearly
    every request on the list has been fulfilled in each distribution,
    resulting in a consistent distribution schedule of 3-6 months for the
    last several distributions. The oldest request currently on the
    list is
    from 07/01/2021. I would ask ARIN to please provide some hard data
    about
    this process for the community to consider when evaluating this
    policy,
    because I do not believe the current reality of the waiting list
    agrees
    with your assertions. If and when that changes, I would possibly
    be open
    to re-considering my position on the matter.

    With regards to leasing, I did not assert that there is no market for
    leasing, but rather that alternatives to leasing do exist and you are
    casting them in an a light that I do not believe reflects the
    reality of
    the situation. Under current policy, your WISP example is free to
    apply
    to the waiting list for the block it needs to try out the new
    area, and
    either return or re-purpose it if services in that new area don't
    work
    out. I don't find a compelling argument here for the necessity of
    leasing addresses.


    Mike- OK the waiting list is rock solid, but my wisp needs a /21,
    what now? My point remains, the waiting list is not appropriate
    for all those in need, and if there were alternatives then there
    would be no market for leases to begin with. I can spend all day
    giving examples of legitimate lessees. I think you should concede
    that there are legitimate business cases where leases make more
    sense for the recipient.


    > Opposing this policy means the only lessors are the lucky
    incumbents.
    If the lucky incumbents choose to retain their IPv4 space and
    lease it,
    that is certainly their choice to make. However, under the current
    policy you propose to change, they may not consider leased
    addresses as
    justification for additional space. I feel the current policy
    strikes a
    perfectly appropriate balance. If a network has leased space
    available
    to reclaim when leases expire, it is inappropriate for them to seek
    additional allocations from the RIR. If they have over-leased their
    space such that they cannot operate their network until someone's
    lease
    expires, then they should not expect the ARIN community to subsidize
    their lack of foresight with additional addresses. Transfers in
    such a
    situation are a different matter and I would certainly consider this
    policy in a different light if leasing space were to be exempted as
    justification for waiting list request.


    Mike- I believe you have conceded that my assertion is correct.


    > Opposing this policy means a lack of policy is preferred,
    despite the
    > open practice of leasing.
    As I originally stated in my first e-mail, I do not prefer the
    lack of
    policy or the insufficiency of the current policy. I would instead
    prefer to see the policy explicitly strengthened to disallow
    off-network
    leasing as justification for additional requests, despite the fact
    that
    ARIN has made it clear that they consider the current policy to
    prohibit
    using such addresses as justification.


    Mike - That is the current policy, to disallow justification
    without a circuit, so  your objection to this proposal means you
    prefer no leasing policy.




    > Opposing this policy provides incentive for registry-shopping and
    > address outflow.
    I agree that RIR-shopping is a concern and there is a real chance
    that
    strict policy against leasing in the ARIN region may encourage the
    practice. However, I don't believe this should be the concern of the
    ARIN community in deciding how to allocate resources in our corner of
    the world. If other RIR communities want to make other decisions,
    they
    are endowed with that freedom under the current system. I don't think
    "everyone is jumping off the bridge so we should too" makes for a
    good
    argument. What would convince me is hard data that shows how the RIPE
    community has benefited from the elimination of the needs-test in the
    transfer process, or data that demonstrates what tangible issue your
    policy proposal would solve in the ARIN region. "Current ARIN policy
    prevents the use of leased-out addresses as evidence of utilization"
    doesn't strike me as a complete problem statement.


    Mike-I consider this also a concession that what I said is true
    about "providing an incentive" which is as far as I went.

    > Opposing this policy reduces the lessor pool and drives up lease
    rates.
    This argument cuts both ways. I would argue that supporting the
    policy
    drives up transfer market prices by increasing speculation by
    entities
    that have no stake in the shared Internet resource aside from the
    rights
    to use IPv4 addresses. Basic math tells us that higher prices in the
    transfer markets will result in higher prices in the leasing
    market, as
    well as resulting in fewer blocks available to networks who wish to
    obtain space directly from the RIR via transfers. I do not see
    this as a
    benefit to the community. As I have stated before, I am
    unmotivated by
    the impacts on lessees/lessors of keeping the current policy or
    strengthening the requirement to provision actual services on an
    operational network. If networks choose to lease, they may pay more,
    which is a similar situation for any capital-intensive resource
    that is
    subject to leasing. Developing policy to keep lease rates low is
    not the
    concern of the ARIN community or this PDP, but rather developing
    policy
    that supports efficient and technically competent administration
    of the
    region's resources.

    Mike- I agree with your first contention, that this policy could
    in fact lead to price increases on the transfer market.
    But the basic math you refer to is the linkage between the
    transfer market and the lease market.
    Transfer prices have doubled this year, lease rates have not
    doubled, they haven't risen anywhere nearly as quickly.
    I think the lack of ability to purchase blocks to feed the lease
    market in ARIN serves to loosen that coupling between the lease
    and transfer market.
    Thanks for phrasing it as "if networks choose to lease", as that
    is a clear understanding of the way things work currently.
    Lessors and lessees are choosing to engage in leasing because they
    both see an advantage.
    So let me admit my assertion that lease rates would drop with this
    policy is just an assumption and not an assertion.




    > Opposing this policy dis-incentivizes accurate registration
    If networks choose to report inaccurate or fraudulent SWIP data in
    order
    to evade the requirements of the current policy, then they are not
    allocating addresses in accordance with ARIN policy and could be
    subject
    to enforcement actions from ARIN. Although I wish ARIN was more
    aggressive in maintaining an accurate WHOIS database and abuse
    contacts,
    I would argue that the current situation in the ARIN region is quite
    good compared to other RIRs in this respect, since there has been a
    regular review process to ensure database accuracy for many years.
    Either way, this policy proposal doesn't fundamentally change
    reporting
    requirements, but simply blesses networks who currently have
    "something
    to hide" to report their usage accurately. Certainly, I can see
    how the
    policy benefits the community in this limited sense. Still, I am
    unconvinced that the net effects would be positive and I do not
    support
    the policy.

    Mike - Thanks, I think we understand that you do not support the
    policy but I don't think that you overcame my assertion this time.
    Because currently there is no "justification benefit" for accurate
    registration, but this policy would create one.



Regards,
Mike





    - Isaiah

    On 9/21/2021 4:29 PM, Mike Burns wrote:
    >
    > Hi Isaiah,
    >
    > That RIPE situation is an unfortunate artifact of their reserve
    pool
    > for new entrants.
    >
    > Can you share the percent of those /24s that begin with 185?
    >
    > You didn’t support Noah’s theory that this policy proposal would
    lead
    > to the demise of RIRs, so let’s address your particular objections.
    >
    > First you wrote “The onus is not on ARIN to sanctify practices that
    > some are already engaging in, but rather to distribute number
    > resources in accordance with community developed policy.”
    >
    > My answer is that this policy proposal continues to distribute
    number
    > resources in accordance with community developed policy.
    >
    > Second you wrote:” If other RIR communities choose to make other
    > decisions, that doesn't make it the correct decision for the
    ARIN region.”
    >
    > I would agree with you, but that doesn’t mean we should ignore
    > relevant data from our sister registry, and I brought up RIPE to
    deal
    > with Noah’s objection about what will happen should this policy
    pass”
    >
    > Third you wrote “There is a waiting list available for
    legitimate new
    > entrants, and I don't buy the argument that networks with
    greater than
    > a /20 cannot afford the capital outlay to purchase a block.”
    >
    > Then you won’t have to worry about leasing, because you claim
    there is
    > no market for it. The waiting list is not a guaranty, and has an
    > unpredictable schedule for address delivery. I gave an example of a
    > WISP seeking to try out a new area, and why leasing addresses
    might be
    > quite attractive to that WISP for entirely legitimate reasons.
    >
    > I feel I have addressed what I see as the objections you have
    noted.
    >
    > Now, why not try to actually address even one of my assertions and
    > tell me where it fails?
    >
    > “Opposing this policy means the only lessors are the lucky
    incumbents.
    >
    > Opposing this policy means a lack of policy is preferred,
    despite the
    > open practice of leasing.
    >
    > Opposing this policy provides incentive for registry-shopping and
    > address outflow.
    >
    > Opposing this policy reduces the lessor pool and drives up lease
    rates.
    >
    > Opposing this policy dis-incentivizes accurate registration”
    >
    > Regards,
    > Mike
    >
    > *From:* Isaiah Olson <[email protected]
    <mailto:[email protected]>>
    > *Sent:* Tuesday, September 21, 2021 5:07 PM
    > *To:* Mike Burns <[email protected]
    <mailto:[email protected]>>; 'Noah' <[email protected]
    <mailto:[email protected]>>
    > *Cc:* 'ARIN-PPML List' <[email protected]
    <mailto:[email protected]>>
    > *Subject:* Draft Policy ARIN-2021-6: Remove Circuit Requirement
    >
    > Mike,
    >
    > I would hardly say it's time for a funeral in RIPE, but I would
    ask,
    > do you think it's a coincidence that roughly 75% of the /24 blocks
    > that I have blackholed on my network for spamming my email
    server are
    > registered to anonymous hosting companies in the RIPE region? I
    don't
    > agree that the results of the RIPE policy speak for themselves,
    and I
    > would love to see more data aggregated by some of the more talented
    > internet sleuths on here regarding the proportion of abuse activity
    > split up by RIR. I also disagree with all five of your assumptions
    > about opposing this policy. The onus is not on ARIN to sanctify
    > practices that some are already engaging in, but rather to
    distribute
    > number resources in accordance with community developed policy. If
    > other RIR communities choose to make other decisions, that doesn't
    > make it the correct decision for the ARIN region. I don't
    support any
    > policy that amplifies the practice of leasing because I reject your
    > arguments about the necessity of the practice. There is a
    waiting list
    > available for legitimate new entrants, and I don't buy the argument
    > that networks with greater than a /20 cannot afford the capital
    outlay
    > to purchase a block. Please feel free to provide any data you
    can to
    > back up your five assertions. For my assertion, please consider the
    > following:
    >
    > Prefixes exchanged within the RIPE region as sales originate have
    > the highest fraction of blacklisted IPs, which is statistically
    > significant.
    >
    > Source:
    >
    
https://eprints.lancs.ac.uk/id/eprint/139789/1/VGiotsas_PAM2020_IPv4_Transfers_abuse.pdf
    
<https://eprints.lancs.ac.uk/id/eprint/139789/1/VGiotsas_PAM2020_IPv4_Transfers_abuse.pdf>

    >
    
<https://eprints.lancs.ac.uk/id/eprint/139789/1/VGiotsas_PAM2020_IPv4_Transfers_abuse.pdf
    
<https://eprints.lancs.ac.uk/id/eprint/139789/1/VGiotsas_PAM2020_IPv4_Transfers_abuse.pdf>>

    >
    > - Isaiah
    >
    > On 9/21/2021 3:24 PM, Mike Burns wrote:
    >
    > I am in total agreement with your sentiment and the requirement
    > for a circuit should continue to stand.
    >
    > Any policy that removes such a requirement would render the
    > management of Internet Number Resources by the registry useless
    > and thereby essentially lead to no need for the registry after all.
    >
    > Noah
    >
    > Hi Noah,
    >
    > Are you aware that there has been no needs-test for RIPE transfers
    > for many years and the RIR system hasn’t collapsed?
    >
    > To make it clear, in RIPE you can purchase address space with the
    > sole purpose of leasing it out. And you have been able to do that
    > for many years now.  Plainly, openly, within all policy. So please
    > let us know where to send the flowers for RIPE’s funeral. That
    > goes for others who predict that bad things will follow from
    > adopting this policy, please keep RIPE’s example in mind to
    > provide a reality check. The experiment has already been performed.
    >
    > Owen has already pointed out the futility of the circuit
    > requirement in practice,  yet you think that’s what keeps the RIR
    > system functional?
    >
    > Opposing this policy means the only lessors are the lucky
    incumbents.
    >
    > Opposing this policy means a lack of policy is preferred, despite
    > the open practice of leasing.
    >
    > Opposing this policy provides incentive for registry-shopping and
    > address outflow.
    >
    > Opposing this policy reduces the lessor pool and drives up lease
    > rates.
    >
    > Opposing this policy dis-incentivizes accurate registration.
    >
    > Let me know if any of these assertions require amplification, I
    > guess some may not be clear but this is already too long.
    >
    > Regards,
    > Mike
    >



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