[Chapter-delegates] What to do about IPv4 address scarcity

[John Schnizlein]

Dear All:

As you may know, IANA’s free pool of IPv4 addresses is expected to be  
depleted within the next few years. I would like to understand more  
about  what people around the world expect the impact of IPv4 address  
depletion to be. Your thoughts on this topic would be very helpful.

When the IANA pool is used up, the allocation pools held by the RIRs  
will also begin to deplete. From then, until IPv6 is fully deployed  
across the globe, there is a reasonable expectation that people will  
experience a scarcity of IPv4 addresses. While the discussions and  
development of policies for handling allocations are appropriately  
taking place in RIR policy forums, I would like to get a broader  
understanding of some of the different perspectives from around the  
globe.

The scarcity of IPv4 addresses has long been expected. Indeed, it was  
one of the motivations for the design of IPv6 fifteen years ago.  
However, IPv4 address scarcity is likely to become more problematic  
than expected because IPv6 is not being deployed as quickly as IPv4  
addresses are being allocated.

Because the Internet will not stop on the day the last IPv4 address  
from the free pool is handed out,  it is clear that network operators  
will exchange address blocks (more than they may be now), as those  
that have spare addresses provide them to those that need more.

Given that the scarcity of any resource increases its perceived value,  
these exchanges are likely to be transactions involving money.  If any  
market is to evolve, it needs to be fair and not damage the routing  
infrastructure of the Internet (such as by promoting the exchange of  
very small address prefixes).

Achieving complete fairness may be impossible in either an open or  
managed market.  The opinion that any trade of IPv4 addresses unfairly  
rewards those who got their allocations early would have to be  
considered.  Fairness in a market for IPv4 addresses would require a  
clear statement that the value of IPv4 addresses is ephemeral – that  
the common goal is to make the value of IPv4 addresses zero by  
converting everything to IPv6.

With that goal in mind, is there a way that money from transferring  
IPv4 addresses could fund development of IPv6?

One reason that a market for IPv4 addresses might need to be managed  
is to preserve the constraint on growth of (default free) route tables  
produced by provider-allocated addresses, which has been essential to  
protecting the global routing infrastructure.  If address prefixes  
from one region are advertised on another continent, what is the  
impact on Internet route tables?  Please send pointers to any  
research, especially numerical estimates, on this.

Market controls need justification, especially on an Internet where  
openness is the essential feature. So, if the impact that trading has  
on routing tables is not huge (considering the multihoming and traffic  
engineering de-aggregation), allowing it to occur may be more cost  
effective than trying to administer market constraints designed to  
control it. If you are aware of any research on this specialized topic  
then I would particularly appreciate your recommendations.

While I welcome comments on this subject at any time, it would be most  
helpful if discussion (on this list) converges before the end of  
September, in time for the policy discussions to be held in the ARIN  
and RIPE policy meetings in October.

John