[arin-ppml] 2008-6: Emergency Transfer Policy for IPv4 Addresses

Matthew Wilder Matthew.Wilder at telus.com
Wed Oct 1 16:32:08 EDT 2008

I was just on a trip in Europe, and I picked up a copy of the book "Undercover Economist", which was a phenomenal read, and one that made me passionate about free markets.  I even wondered if there was a place for applying the free market model (albeit a regulated one) in the world of IP Addressing.  Reason would suggest that the IP Addresses would go to the most deserving applications (financially anyway) since bidding would rise to the point where only the successful bidder of a resource is willing to pay.

Since considering this thought and trying to develop it out, I cannot reconcile multiple and very important issues.

1) Fairness:
The fundamental struggle of free markets is a tendency to drift away from fairness and toward efficiency.  In the case of introducing a free market to a resource that was never at any point intended to be a free market would introduce ridiculous unfairness, and result only in rewarding those who could be argued have been dishonest (apologies for the moral tone, but fairness requires some moral perspective).

2) Externality:
In economic terms, externality is the cost is incurred outside of a closed transaction.  Liberalized IP Address Transfer would result in considerable externality outside of the parties who transfer the resources.  Not to mention that there are at least two transfers in the case of successful brokerages who will firstly buy a resource, then secondly sell that resource off.  Or what if they buy a single /16 and split it up into 16 /20 subnet, which results in 17 transactions from one original resource, not to mention the routing table explosion it causes.  Will the bystanders be compensated for their incurred cost?

3) TRUE Efficiency:
The lobbyist for the liberalized transfer policy appeals to the ongoing ability of deserving organizations to procure IP Address space.  Perhaps the most significant misrepresentation here is the meaning of the word deserving.  Though it would imply the organization who can best justify the need for the addresses, it actually means the organization willing to fork out the most, which are two entirely different thing.  For example, consider who is most deserving between a non-profit internet society with hundreds of members versus a small accounting firm.

I believe that morality is a very reasonable basis for discussion, but that other arguments also challenge the reason behind a liberalized transfer policy.

-----Original Message-----

Milton Mueller wrote:

> Again with the equation of a simple, rational and not
> intrinsically illegal or harmful economic transaction
> with harmful and exploitive activities.
> This is just pure rhetoric. Please try to elevate your
> discussion of the topic to an appropriate level.

>> -----Original Message-----
>>  Again with the "It's gonna happen anyway" argument..
>> Again I say then should we legitimize selling heroin to
>> Child prostitution? Sales of pirated coyrighted material?
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