[arin-ppml] FW: Creating a market for IPv4 address space inabsenceof routing table entry market

[Milton L Mueller]

> -----Original Message-----
> No. There are several options. [to acquiring other ISPs to obtain
their addresses --MM]
> 
> 1. Multilayered NAT to put more users behind each IPv4 address.
> 
> 2. Just pirate some addresses from another region. For instance APNIC
> allocated all of 126.0.0.0/8 to Softbank, a Japanese cable provider.
If
> an American ISP decided to "borrow" these addresses, then few of their
> customers would notice that they cannot contact consumer cable
customers
> in Japan. 130.0.0.0/8 is another interesting block as are the various
> military allocations.

Is it just me, or do these first two alternatives not look so great? ;-)
More NAT-ing and a fragmented internet?

> 3. IPv6 is always an option.

Yes. But remember, a parameter of this discussion is that we are talking
about what ISPs _who want more v4 addresses_ will do. If they have
already decided to migrate to v6 and are not interested in more v4
addys, then they are outside the bounds of this discussion.

> 4. Shop for an upstream provider that will provide the needed
addresses.

This is reinforcing my point. The upstream will sense the demand for
more v4 addresses and might consider acquisitions of smaller ISPs to get
them. 

> I don't know about the USA, but in Europe, the largest ISPs come from
a
> telco background and these companies are members of an association
> called ETNO which does various things like fixing broken standards,
and
> issuing joint position papers. ETNO recently released a position paper
> saying that IP addresses should not be sold, which I would interpret
to

Ah yes, good old ETNO. No time to go into details but I think that those
of you who are worried that address transfers might increase incumbents'
market power might do well to contemplate why ETNO is do dead set
against address transfer markets. Is their opposition consistent with
your theory? 

> mean that these companies will *NOT* sell surplus IP addresses. Giving
> them to a customer who needs them is just business as usual so I
expect
> that the only way to access this surplus will be to buy service from
> such companies.

And that might have something to do with their opposition to transfer
markets, eh? 
 
> Clever readers will have noticed that under today's rules where
private
> transfers are not allowed, a company needing IP addresses could pay an
> ISP for service and get some addresses for free. 

Nothing is free. If their possession of addresses is the main reason you
are going to them for service then you are going to pay for the
addresses, believe me. 

> Under the market
> scenario that some are promoting, a company needing IP addresses could
> pay an ISP for addresses and get no service at all. One of the reasons
> for promoting this is that they fear some companies today are paying
an
> ISP for service and getting IP addresses, but passing on the services
> that they paid for. It seems strange...

That's called "unbundling." There's a whole economic literature on how
unbundling components of a service with different competitive conditions
can improve consumer welfare, and how bundling them together can
increase the market power of the bundler.