[arin-ppml] Will the price per IP really be affected by thetransfer market introduced in 2009-1?

[Ted Mittelstaedt]

> -----Original Message-----
> From: Joe Maimon [mailto:jmaimon at chl.com] 
> Sent: Thursday, May 14, 2009 12:43 PM
> To: Ted Mittelstaedt
> Cc: 'Martin Hannigan'; 'ARIN PPML'
> Subject: Re: [arin-ppml] Will the price per IP really be 
> affected by thetransfer market introduced in 2009-1?
> 
> 
> 
> How does this work in any competition based market system?
> 
> Sellers must sell just as buyers must buy, and a seller who 
> wants to sell will need to do so at a price both can agree on.
> 
> Otherwise they arent making any money, and they will lose 
> sales to the first person who will lower prices to make the sale.
> 

That only works in a commodity market.  Many markets do not work this
way.  For example, housing.   Many many people right now are sitting on
homes and NOT selling even though they are still having to pay mortgages
on them on loans that they are underwater on, because they HOPE that
prices will rise.

You can argue that home markets are not competitive - well that's not
true since home values are lowered by lowering values on nearby homes.
But even though they are competitive, they still do not act like the
Adam Smith ideal of capitalism.

There are many many examples of people who could have short-sold
a second home and walked away with a minor capital gains penalty,
but due to a refusal to countenence taking a loss, gambled and ended
up in foreclosure and bankruptcy and lost their primary home too.

> > what they have, waiting for that once-in-a-blue-moon 
> spectacular sale 
> > they can make a killing on.
> 
> When it comes to ipv4, there is an inherent correction to 
> spiraling prices of ipv4 due to any activity, including 
> speculation, aside from all market theories and mechanisms.
> 
> IPv6 migration and the resulting over-abundance of ipv4.
> 
> If ipv4 costs too much, for any reason, than ipv6 looks very 
> attractive in comparison.
> 
>  From an economic perspective, thats a win-win situation. 
> ipv4 is more efficiently utilized and/or migration to ipv6 
> now has financial incentive and reward.
> 

It is way too early to know if the IPv4 market will act like, for
example, the market for milk, which does meet your ideal, or it
will act like the market for housing (which right now meets nobody's
ideal)

> The only concern regarding transfer systems that has 
> resonated with me to date is government may seize the 
> opportunity to exert control over this arena, a risk 
> increased by any appearance of similarity to currently 
> regulated markets.
> 
> However, this same risk would only grow if or when ipv4 
> shortage becomes a world wide front page issue, full of 
> op-eds that there should be a market (or worse), perhaps 
> government controlled.
> 
> Damned if you do, damned more if you dont.
> 
> The only way out is if one can state with a certainty that runout and
> ipv6 migration will be seamless and painless and almost 
> no-one who can will notice or care enough to try to do 
> anything about it. I am not ready to lay good odds on that.
> 

No migration is painless.  The 64-bit question is whether allowing
a transfer market makes a bad situation worse.

Ted