[arin-ppml] [arin-discuss] x-small IPv4 ISPs going to IPv6

[Ted Mittelstaedt]

On 5/3/2010 1:53 PM, marty at akamai.com wrote:
>
>> From: Ted Mittelstaedt<tedm at ipinc.net>
>> Organization: Internet Partners, Inc.
>> Date: Fri, 30 Apr 2010 17:17:43 -0700
>> To: Owen DeLong<owen at delong.com>
>> Cc:<arin-discuss at arin.net>, ARIN PPML<ppml at arin.net>
>> Subject: Re: [arin-discuss] [arin-ppml]  x-small IPv4 ISPs going to IPv6
>>
>>
>>
>> On 4/30/2010 3:52 PM, Owen DeLong wrote:
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>
> [ clip ]
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>
>>
>>> If we want to consider an extended or permanent fee waiver
>>> for those organizations, the maximum possible impact to ARIN
>>> revenue would be a waiver of up to $866,000 (with adjustment
>>> for new x-small organizations that might get added).
>>>
>>
>> Yes, but you failed to mention that this is offset against
>> the additional $866,000 that ARIN would take in if all those
>> orgs for IPv6 with no waiver.
>>
>>> I'm neither speaking for or against such a waiver at this time,
>>> merely trying to provide a clear view of the facts and potential
>>> impacts of such a waiver and the number of organizations that
>>> could benefit from such a waiver.
>>>
>>
>> But ultimately there are no impacts (financial at any rate)
>
> All of those costs would be shifted to v4 resource holders.
>
> ARIN also reported a net deficit with respect to budgets for 2009. For
> example, the Treasurers Report for 2009 showed revenue of 13m, expenses of
> 15m. That's a $2m deficit. Eliminating the $900k in revenue would have
> significant impact from my perspective.
>
>>
>> As I thought I explained, the "missing" .8 Mil is something that
>> if nothing is done, is additional fees ARIN will make in the future
>> when the x-smalls are forced to go to IPv6.
>
> We haven't seen a business model that shows v6 only revenue. I don't think
> that this is the plan as v4 resources will be in use for some time. I do
> think that v4 revenues, at some point, will begin to rapidly decrease. That
> is a significant problem if we are to do this correctly.
>
>
>>
>> If something is done, then ARIN does not make those additional fees
>> and instead merely makes the same fees they are making now.
>>
>> Also since ARIN is duty-bound to return that .8 Mil in the form of
>> fee DECREASES then the real argument is this, do we want the
>> ultimate revenue ARIN takes in to NOT increase as a result of IPv6
>> or do we want it to DECREASE so we all (ISPs who are NOT x-smalls)
>> can get a nice break on our own fees?
>>
>> You made it sound like the community is losing money if we do a
>> waiver which is definitely not the case.  The transition to IPv6
>
> What support do you have for this statement? Using the 2009 Treasurers
> report, net revenue rose less than $220k. Expenses rose by about the net
> deficit of $2m not including the drawdown of the reserve fund.
>
>
>> means more numbers handed out to the same fishes,
>> which due to the current fee structure results in a bonus for
>> ARIN.  It does not increase the number of fishes and as you have
>> constantly harped on in the past ARIN sets fees based on how
>> many fishes they have to keep track of, not how much IP numbers
>> they have handed out.  So if your going to be consistent with
>> what you have beaten me over the head with in the past, you should not
>> be making the financials seem like a revenue loss to continue
>> to do a IPv6 waiver for the x-small IPv4 set.
>>
>> With financials it's all in the presentation.
>>
>
> Have you seen the 2009 financials?

Well, according to the annual report for 2009 the 2009 audited
financial statements are not out yet.

The unaudited "budget" for 2009 is on the website but this really
doesn't mean much of anything since the complete figures are not
there.

Furthermore, if the 2009 published financial report is going to be 
anything like the 2008 audited financials the problem is that there
is no detail that accompanies any of it, so nobody can really
divine anything about it.  For example in 2009 and 2010 they
have thrown 3 M into "depreciation" well depreciation of what?
If it's a past expense that isn't going to be replaced with
more expense then who cares?  That figure is just there for
tax purposes, it doesn't mean that it affects cash.  They spent
the cash when they bought whatever is depreciating now.

None of the public financial documents really has the detail
needed to know if any of the expenses are justified or not, or
need to be continued, for example 1.3M is allocated to travel in
2009 and 2010 well we don't know what travel this is and why
it's needed and why it couldn't be replaced with video conferencing
or whatever.

Not that I'm picking on travel per-se but the problem here is
without much greater detail than what the financials show, it's
not really possible to make the claim that your making that ARIN
is desperately short money.

For all we know the million in depreciation was for the 50 million
ARIN yacht purchased 3 years ago and in 2011 it will be fully
depreciated and depreciation will fall to nothing, and the million
in travel was for the ARIN tourist rocket to outer space that
they didn't book for next year, and so now the budget is in
balance.

An expense like the $400K for rent and occupancy, that's a very
checkable expense, all you have to do is call up the ARIN office
building and see the sq footage then look at any commercial real
estate in that market and see that it's in line with everyone else,
thus even though that's a large expense, it is of very little
interest since it's so narrow and so obviously justified.

But an expense like Travel that's a huge bucket.  Legal Fees
are also another deep black hole in any org since orgs really don't
like publishing all the details of their out-of-court settlements.
There's no way just looking at the figure to know if it's justified
or not.

I hope you see what I mean.


Ted


  I'd be interested to hear where you think
> my logic is off.
>
> Best,
>
> -M<
>
>