Agreed having been in the ISP business since there were ISPs, the most common 
way to get started is to get an allocation from your upstream provider.  A 
bigger Tier 1 ish provider is more likely to give you a larger allocation since 
they hold a lot of resources they are not costing them much to retain.  

While you are at it, get an IP V6 allocation and AS to start going that way as 
much as possible.  I wouldn't go with an IX initially (they become a more 
attractive option once you get to the size where peering would be an option).  
Most startups I have worked with get going with two upstream providers and a 
block provided by one of them.  Make sure you check with both carriers on their 
policy regarding advertisement of the block from both upstreams.  In order to 
get the two upstreams even close to balanced you will probably have to have the 
upstream that owns the block break the supernet for you (if one carrier is 
advertising the /24 you will get more traffic that way since it is a more 
specific route).  I would also recommend getting upstream carriers that are 
similar in tier because if you have a very well connected upstream and a much 
smaller one, you will be less likely to use both connections effectively.  Make 
sure your upstream will support V4 and V6 on the same transport circuit (most 
will now).  Be sure you like the carrier that gives you the initial allocation 
since you are going to be a voluntary hostage for a while.

Trust me, you want two upstreams even if you have to sell your dog to do it.  
You do not want your fragile new business to get wiped out by a single upstream 
outage (remember to them you are just a single customer, to you it is your 
whole ball game).

You are in for some engineering work trying to squeeze the most out of the very 
limited V4 resources and are going to have to push back hard on allocations to 
customers to avoid ripping through them quickly.  You are going to have to do 
the heavy lifting of NAT to get the customers the connectivity to the V4 world 
(until you can get them to V6).   The most important factor will be whether the 
majority of your customers are business vs residential.    Another big start up 
question is how much CPE do you want to manage.  If you own the CPE you can get 
fancier with it and not have to worry about customers having to deal with V6 
configuration.  If they own the CPE you have to make it as easy as possible for 
them.  Having worked in both environments I have to say that customer owned CPE 
costs the small ISP a lot of time and effort in support (way more than home CPE 
costs).    Do NOT charge a customer less for using their own CPE, discourage 
that as much as possible.  It is more pain for you when they provide the CPE 
for sure.

Business = usually less churn but more likely to want a V4 static address
Residential = more churn and the majority don't care whether they are running 
V4 or V6 as long as it all works automagically.  

The most successful ISPs I have worked with have a mix of business and 
residential which gives you better traffic patterns throughout the day.  
Business oriented ISPs tend to be underutilized after hours and residential 
ISPs tend to get hammered in prime hours.  Business customers give you great 
stability in regular cash flow and residential tends to up the customer count 
to smooth out the churn percentage.   Churn is your biggest enemy.  Figure out 
how long you need to retain a customer to achieve positive cash flow after 
provisioning costs are factored in.  Most times this number comes as a shock to 
a new ISP.  If cash is so tight that a $5k expense is an issue you need to 
carefully examine whether you can survive the original provisioning of the 
network to get to positive cash flow.  I have been out of the finance side for 
quite some time now but I don't think it would be unusual to find that you have 
to keep a customer for 18 months or so before you are making a dime on them. 

Steven Naslund
Chicago IL







>-----Original Message-----
>From: NANOG [mailto:nanog-boun...@nanog.org] On Behalf Of Baldur Norddahl
>Sent: Friday, January 05, 2018 9:36 AM
>To: nanog@nanog.org
>Subject: Re: IPv4 smaller than /24 leasing?
>
>Joining an IX is in most cases much more expensive than buying a /24. You can 
>get a /26 from your upstream. Having multiple upstreams is in most cases much 
>more expensive than buying a /24.
>
>I do not see a real problem here. Aside from the irritation of having to pay 
>for resources others got for free and then horded.
>
>Regards
>
>Baldur

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