[Chapter-delegates] scarcity of IPv4 addresses

[John Schnizlein]

Discussion of this situation and how ISOC should stand on it has  
continued over the roughly six weeks since I asked for discussion of  
it here.  Thanks to those who replied.

Please comment on the following draft ISOC position.

John

1) ISOC believes there is no practical way to prevent address
transfers - so we advocate registering the transfers.

Some member of Regional Internet Registries (RIRs) oppose any transfer  
other than recovery of unused addresses to the RIR for re-allocation.   
They oppose any opportunity for address holders to profit from  
transfers as unfair.  Anecdotes that (part of) companies have already  
been traded in order to acquire address blocks they hold suggest that  
this opposition is futile.  Scarce resources become valuable, and will  
be traded, either openly or secretly.

2) The transfers need to be registered to preserve the integrity of
who can inject routes into the routing infrastructure - for IPv4 and  
IPv6.

Ongoing problems with illegitimate routes being injected into the  
global routing infrastructure (either by accident or due to malicious  
intent) must be solved.  We cannot envision any way to solve this  
without knowing the current legitimate holder of address prefixes.

3) ISOC opposes a central formal managed market that clears trades and  
prices,
for IPv4 addresses, but does not advocate barriers to transactions  
between parties.

While there is potential value to operating a central clearing for  
transactions, like a stock or commodity market, especially open and  
transparent pricing, such a Market Maker would be exposed to risks of  
a variety of charges of unfairness.  It is possible (but we do not  
consider it likely) that demand for such a market will induce private  
market makers.

What might have justified RIRs taking on those risks would be the need  
to assign addresses to fit routing hierarchy.  In such a market,  
prices for address blocks would depend on the block size, but which  
actual address was allocated would depend on the implications for the  
global route table as well as the offered price. Instead of evidence  
that this is necessary, what we have found is that the global route  
table is scrambled to accommodate traffic engineering and multihoming  
already, and arbitrary transfers would not matter.

4) ISOC believes that transfers will extend the availabilty of IPv4  
addresses while
IPv6 gets distributed.  Gradual increases in the cost of acquiring  
IPv4 addresses
may incent network operators and developers to deploy IPv6.

The belief that network operators would deploy IPv6 in parallel (dual  
stack) with IPv4 while there were sufficient IPv4 addresses, so that  
new IPv6-only hosts could reach everything, was wrong.  There was no  
economic incentive for operators to prepare for a future while there  
were sufficient addresses.  It is conceivable that operators with  
sufficient contractual leverage on their suppliers and consumers could  
undertake the costs of conversion to IPv6-only in order to realize the  
value of IPv4 address space they would transfer.