Regards,
Mike
From: ARIN-PPML <arin-ppml-boun...@arin.net> On Behalf Of Holden Karau
Sent: Thursday, March 17, 2022 7:29 PM
To: andrew....@quark.net
Cc: arin-ppml <arin-ppml@arin.net>
Subject: Re: [arin-ppml] Revised and Retitled - Draft Policy ARIN-2021-6:
Permit IPv4 Leased Addresses for Purposes of Determining Utilization for
Future Allocations
Wait so some company could come to ARIN and ask for a block of IP addresses
using leasing as the justification and then turn around and lease them.
What value is the leasing company providing? It seems like a solid way to
get a bunch of LLCs formed to acquire IP addresses from the waiting list and
then make money for doing ~nothing.
On Thu, Mar 17, 2022 at 4:18 PM Andrew Dul <andrew....@quark.net> wrote:
The draft policy as currently written does not provide any
additional limits against speculation. As drafted, it allows
any organization (including those who do not operate networks)
to obtain IPv4 addresses for the purpose of leasing.
With that policy change what types of limits does the community think
would be needed?
Thanks,
Andrew
On 3/17/2022 3:00 PM, Scott Leibrand wrote:
+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
<arin-ppml@arin.net> wrote:
On Mar 16, 2022, at 15:22 , Fernando
Frediani <fhfredi...@gmail.com> 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
<j...@egh.com> 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
<b...@herrin.us>* wrote ----
>
> On Wed, Mar 9, 2022 at 8:24
PM ARIN
<i...@arin.net <mailto:i...@arin.net>>
> 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
>
b...@herrin.us <mailto:b...@herrin.us>
>
https://bill.herrin.us/ <https://bill.herrin.us/>
>
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--
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Evans Griffiths & Hart, Inc.
781-861-0670 ext 539
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===============================================
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