[arin-ppml] Use of the specified transfer policy (was: "Leasing" of space via non-connectivity providers)

[Benson Schliesser]

On Feb 7, 2011, at 7:09 PM, John Curran wrote:

> For a party (e.g. legacy holder) who plans to monetize their space in
> any case, there are two downsides to doing it via the Specified Transfer
> policy:
> 
> 1) You have to enter into an LRSA, but from a practical matter it is 
>   only going to be meaningful for the fairly short duration from when
>   you enter into it and until you transferred all your address holdings
> -and-
> 2) You can only transfer what the recipient qualifies for, which is 
>   limited to 12 months of their documented address need per the NRPM
>   in the ARIN region.

Except that the current LRSA forces the holder to waive any claim of property rights and cannot be terminated without forfeiting the legacy addresses, encumbering the holder's legal recourse to redress.  And while it is in force there is no guarantee that the policy and contracts applied to ARIN participants (including the potential recipients) will remain consistent.  So, the "short duration" that you described actually has a great deal of risk, including a risk that the duration itself stretches out materially.  This is a pretty bad situation to be in, if one is trying to monetize address resources within a limited window of time i.e. while IPv4 still has value.

> Because your address holdings actually get vetted when you entered the 
> LRSA, the benefits to the recipient is that they know you actually have 
> the ability to transfer per policy (and aren't just someone who hijacked 
> the space by registering an expired domain name on a contact & emailing)

I agree that this assurance has value.  But the value of ARIN's vetting is minimal unless ARIN 1) is able to represent itself as the sole legal "authority" in the matter of address allocations, as applied to the legacy address block, and/or 2) is willing to provide some form of insurance against loss (title insurance?) due to incorrect vetting.

> This certainty is key for most organizations that intend to build a 
> long-term business based on use of the number resource.  Note also a 
> (growing) recipient probably has many existing address blocks that are 
> already under RSA, and the one received by transfer is no different.
> I'm looking for the onerous policy considerations regarding the need
> for L/RSA agreements, and for the vast majority of expected users of
> the policy, it's not clear that is any agreement-related downside.

For any recipient of addresses under the transfer policy, because of the RSA requirement, there is real risk associated with the ongoing ability to use an address block.  The RSA has a very one-sided auto-update provision as well as the forfeiture at termination clause, and ARIN policy is subject to change.  You might argue that the risk is the same as RIR-provided addresses historically, and I wouldn't object.  But that class of holders has paid only a nominal fee to receive their addresses, not "market rates".

Further, the risks associated with the LRSA/RSA don't apply to legacy holders that have not signed the LRSA, making non-encumbered address blocks much more appealing.

> I agree that the policy isn't likely to be favored by speculators or 
> address squatters, and that those segments may have been historically
> underrepresented in the policy development process.  Correcting that
> is left as an exercise for the community, if so desired.


Given my comments above, I hope you're recognize that there are concerns applicable to buyers other than "speculators or address squatters".

That said, the avoidance at any cost of market speculation isn't necessarily in the community's interest.  I'll comment more on that as part of a draft policy proposal I'm working on, and look forward to debating it.

Cheers,
-Benson