+1 to both Owen and David Farmer's comments. Leasing IPv4 space is
likely the best solution for some networks that need those addresses
to operate their network. If an organization wants to acquire and
lease out IPv4 space without providing bundled IPv4 transit, that
should be allowed by policy. It might be useful for ARIN policy to try
to slightly dampen speculation by requiring that organizations seeking
to acquire large blocks of IPv4 space demonstrate that their current
holdings are being efficiently used by the organization they're
registered to in whois. I am not sure if this policy proposal does
that to my satisfaction, but once we ensure it does so, I would likely
support it.
-Scott
On Thu, Mar 17, 2022 at 1:33 PM Owen DeLong via ARIN-PPML
<[email protected]> wrote:
On Mar 16, 2022, at 15:22 , Fernando Frediani
<[email protected]> wrote:
Hi David
If I understand correctly you seem to have a view that there
should be a ARIN policy to permit IPv4 leasing just because it is
a reality and we kind of have to accept it in our days. No we
don't, and that's for many different reasons.
Well, of course, you are free to deny reality as much as you want.
Many people do. It’s not particularly helpful in the discussion,
however.
I am used to see people saying the brokers are doing a good thing
for the community by facilitating the things which in reality is
the opposite. It may look like a good things, but the real
beneficiaries are only them who profit from it without much
concern of what is fair or not to most organizations involved.
You are actually mistaken here. I used to think as you do,
actually. I was very resistant to the first “specified transfer”
policies because of some of the reasons you describe. However,
what you are failing to recognize is that:
+Brokers and specified transfers were going to happen with or
without the RIRs. If they happened without the RIRs,
there’d be no accurate record of who was using which address space
and the provenance of addresses would be
very difficult to support or defend.
*Benefit to the community from brokers: (ethical) brokers are
familiar with the rules in the RIRs in which
they operate and can assist their customers in accurate and
compliant registration updates and
aid in keeping the allocation database(s) accurate.
+With the economic realities of IPv4 addresses becoming
progressively more and more expensive and the advent
of ISPs with limited IPv4 resources available, it is inevitable
that more and more IP service providers will be
doing one or more of the following:
+Separate surcharges for IPv4 addresses
+Expecting customers to supply their own IPv4 addresses
+Surcharges for IPv4 services
+IPv4 “installation charges” large enough to cover the procurement
of addresses
*Brokers assist ISPs and customers in many of the above circumstances.
+With a variety of organizations holding IPv4 addresses that may
or may not even known they have them and whose
IPv4 resources may vastly exceed their needs, it is (arguably)
desirable to have those addresses be transferred to parties
that have current need for IPv4 addresses.
*Brokers provide a valuable service to the community identifying
and marketing these resources
*Paid transfers provide an incentive for entities to make more
efficient use of the resources they have in order
to monetize the resources they no longer need. Brokers are
frequently able to assist in this process.
+With the high cost of acquisition, IPv4 addresses have become a
capital intensive part of any network-dependent
business model that must support IPv4. Further, there is some risk
that this capital outlay may be fore a resource
which will abruptly and quickly lose its value and no longer be
needed well before it can be amortized as a capital
expenditure. As such, it may make sense for some entities to
transfer that risk to another organization by using
a lease structure instead of purchasing the addresses outright.
*Brokers that provide IPv4 leasing in an ethical and policy
compliant way provide a valuable service
to these businesses. Yes, their price per address may eventually
be more than it would have cost
them to purchase the addresses, but the same is true of virtually
any rental situation. On the other hand,
that excess helps offset the risk that the lessor is taking by
owning a resource that may or may not remain
valuable and may or may not continue to produce revenue.
IP Leasing is very different from IP Transfer which I see not
problem they continue doing it. IP Transfer at least we have some
guarantees that the directly receiving organization really
justify for them and that is a quiet important (I would say
fundamental) point to look at, because that is fairer to everyone
involved. What guarantees we have when a IP Leasing is done in
that sense, that fairness start to lack here.
If we set the policies up correctly, we should have the same exact
guarantees on a lease.
If $ISP acquires a /10 through transfer and then issues various
subordinate prefixes to their customer, the only guarantee
you have that $ISP’s customers who receive the addresses really
justify them is that $ISP says so. We generally trust $ISP
to act in good faith.
If $LESSOR acquires a /10 through transfer and then leases various
subordinate prefixes to their customers, we have pretty
much the same guarantee with the additional bit that $CUSTOMER is
at least willing to pay enough for the addresses to $LESSOR
to make the lease make sense. In general, I think it is somewhat
safe to assume that $CUSTOMER is not going to make a
monthly recurring payment to $LESSOR for something they don’t
intend to use. If one’s intent is to deprive the market and
inflate the price, then the risk profile for such a transaction is
vastly more favorable if you purchase rather than lease.
Sure, there could be lessors that don’t get reasonable
justification for allocations from their customers, but there are most
certainly ISPs in that category as well. Either way, you’ve got
very little assurance. A lessor can provide just as much
justification to an RIR for the addresses they will allocate to
leases as an ISP can for addresses they will lease to their
customers. The only difference is a lease with connectivity from
the same company or a lease from a company other than
the one(s) providing connectivity.
People see the brokers are doing a favor to organizations in
general by facilitating they get some chunks of IPv4, but that in
reality makes the cost of IPv4 for both leasing and transfer more
and more expensive as it makes organization even more dependent
from these those crumbs that seem to be offered with good
intention but in reality it is feeding a system that is contrary
the interests to most organizations involved.
Just as you are free to mount, balance, and rotate your own tires,
or, you can go to a tire store and have them perform that service
for a fee, brokers provide a service for a fee. If you want to
obtain addresses in the transfer market without a broker, you’re
still free to do that. Brokers are not driving the cost of IPv4…
The scarcity and difficulty of operating with IPv4 is driving the
cost of IPv4. Brokers are along for the ride providing a service
and collecting a fee for that service. Whether that fee is
reasonable or not is (and should be) entirely in the eye of the
customer. Customers are always free to walk away and find a
different supplier or look for their addresses independently.
It may sound a cliche but IPv4 is over and organizations must
learn how to survive with what they have, reinvent themselves and
make better used of their IPv4 resources, deploy a proper CGNAT,
deploy IPv6 either they like it or not, etc. If an organization
have so little or none and need some minimal amount is fine they
seek for a Transfer of a minimal amount with the help of brokers.
I agree. However, the increasing cost of IPv4 is a natural and
organic part of that process and sticking our heads in the sand
and pretending that it is not the economic reality of how the
current world works will not help anyone. Not the community, not
organizations that are short on IPv4 resources, and not the RIRs
who are only useful so long as their databases provide a
reasonably accurate reflection of the actual utilization of the
address space and who controls it.
A broker is an LIR just like an ISP. Since ISPs are now charging
for addresses independent of connectivity and bandwidth, it only
makes sense that customers can shop for them separately from
different suppliers. Just like you can buy tires for your car from
the dealership or from some other store that sells and supports
tires, IPv4 addresses are moving that way as well. The RIRs can
either recognize this and adapt to it with policies that make
sense and preserve some of the things you’ve outlined as concerns
above, or, they can simply deny the reality of IPv4 leasing and
lose track of how addresses are actually managed for some
significant chunks of the internet.
Encouraging IP Leasing as if it were something normal just
"because it exists today" is a shot in the foot that in the long
term only worsens the existing scenario, it feeds a market
without much discretion increasing final prices for everyone and
what is the worst of all, creates even more unfairness for
everyone who has always submitted to the rules we have until
today for distributing addresses to those who really have a real
justification to keep control of that resource that does not
belong to them.
I don’t believe that a policy that merely allows IPv4 leasing can
be said to encourage it. Rather, it permits it, recognizes that it
exists and is not going to stop existing just because policy
pretends it can’t exist.
The market is not likely to be significantly swayed by policy in
terms of pricing, with the exception that AFRINIC has been able to
preserve a devalued price on addresses within their region due to
their restrictive lack of a transfer policy for moving addresses
to/from AFRINIC. However, while this has the effect of keeping
AFRINIC IPv4 addresses less expensive on the open market, it also
leads to a significant amount of utilization of those addresses
outside of policy and quite a bit of hoarding of addresses by some
of AFRINIC’s largest members. ARIN’s counsel has advised against
naming names here, so I won’t, but if you want names, contact me
off list.
Owen
Regards
Fernando
On 16/03/2022 13:09, David Farmer via ARIN-PPML wrote:
Yes, bundling IPv4 addresses with bandwidth is permitted, and in
the past was common practice, heck even the expected practice.
However, the fact that IPv4 address demand isn't decreasing
significantly, the costs to acquire new IPv4 addresses are
increasing significantly, and with the increasing
commoditization of bandwidth, it is no longer economically
viable to bundle bandwidth, and its associated connectivity,
with IPv4 addressing. This is driving a structural separation of
bandwidth, connectivity, and IPv4 addressing, from each other,
instead of bundling them together as in the past.
Let me state that differently; ISPs are being driven, buy cost
conscience consumers, to separate the costs of bandwidth and the
costs of the IPv4 addresses needed to utilize the bandwidth from
each other. Minimally this separation is achieved by accounting
for the costs on separate line items of a common bill from a
single provider. However, price competition for bandwidth and
IPv4 addresses separately will inevitably drive a structural
separation between the two. Consumers will want the best price
they can get for bandwidth and the best price they can get for
IPv4 addresses, regardless of whether they come from a single
provider or not.
Some may argue this is being driven by the existence of address
brokers, and their desire to make money, I disagree. While
address brokers making money is the grease that keeps this
machine working, the need for the machine is driven by; IPv4
free pool exhaustion, the increasing cost of IPv4 addresses, and
the lack of adoption of IPv6.
In other words, address brokers wouldn't exist if there wasn't a
demand for their services.
In short, the economic conditions that allowed for and even
encouraged the bundling of IPv4 addresses with bandwidth and
connectivity no longer exist, that world is gone. While I have
not personally yet determined if I support this particular
policy text, nevertheless, the time has come to recognize the
next step in this inextricable evolution of IPv4 address policy
by the ARIN policy community and permit IPv4 leasing.
Thanks.
On Fri, Mar 11, 2022 at 5:05 PM John Santos <[email protected]> wrote:
I disagree. The addresses are useless unless they ALSO
purchase access and
routing from another network operator. How is this cheaper?
It is and always has been allowed to lease bundled access of
addresses and
connectivity from a LIR, without any expense for purchasing
those addresses.
On 3/11/2022 12:13 PM, Tom Fantacone wrote:
> I support the proposal as written.
>
> It facilitates the provision of a valuable service to a
large swath of the ARIN
> community, namely the ability of network operators with an
operational need to
> lease IPv4 addresses from 3rd party lessors at a fraction
of the cost of
> purchasing those addresses. Too often we have seen
network operators justify
> their need for IPv4 space only to find that they can't
afford to make the
> purchase. They end up using CGNAT or some other
sub-optimal solution.
>
> Bill, regarding your point "B", by providing IPv4 leasing,
these 3rd parties are
> certainly performing a function that ARIN does not.
>
>
>
> ---- On Thu, 10 Mar 2022 17:46:36 -0500 *William Herrin
<[email protected]>* wrote ----
>
> On Wed, Mar 9, 2022 at 8:24 PM ARIN
<[email protected] <mailto:[email protected]>>
> wrote:
> > * ARIN-2021-6: Permit IPv4 Leased Addresses for
Purposes of Determining
> Utilization for Future Allocations
>
> I continue to OPPOSE this proposal because:
>
> A) It asks ARIN to facilitate blatant and unapologetic
rent-seeking
> behavior with changes to public policy.
>
> B) It proposes that third parties perform precisely
and only the
> functions that ARIN itself performs without any
credible compliance
> mechanism to assure the third party performs to ARIN's
standards or in
> accordance with the community's established number policy.
>
> Regards,
> Bill Herrin
>
>
> --
> William Herrin
> [email protected] <mailto:[email protected]>
> https://bill.herrin.us/ <https://bill.herrin.us/>
> _______________________________________________
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> _______________________________________________
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--
John Santos
Evans Griffiths & Hart, Inc.
781-861-0670 ext 539
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===============================================
David Farmer Email:[email protected] <mailto:email%[email protected]>
Networking & Telecommunication Services
Office of Information Technology
University of Minnesota
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