[arin-ppml] Integrating Draft Policy ARIN-2011-1 into NRPM 8.3

[John Curran]

On May 27, 2011, at 10:15 AM, Mike Burns wrote:
> 
> By requiring a needs test for inter-RIR transfers, we run the risk of driving these transfers off the books in contravention of our PRIMARY function as stewards.
>  
> Just so we all understand.
> APNIC has a great need, and probably less underutilized addresses in its market to supply that need.
> A good chunk of available space is likely to be found in the legacy pools which are overrepresented in our region.

Mike - 
 
    Presuming your statements above, there are several ways to make policy which
    would allow such transfers
 
    - No needs assessment
    - Needs assessment performed by the other RIR
    - Needs assessment performed by ARIN
    - Needs assessment performed by qualified third-party
    - etc.

    Since there will be lots of parties in other regions with clear need, setting
    policy which requires some demonstration of such need should not necessarily
    drive the transactions away.  By "risk" above, are you referring to parties
    that actually need the address space for their network growth?

> Once again, I make the point that a market in IPv4 addresses, such as envisaged in 8.3 or in the APNIC transfer policy, meets the stewardship goal of conservation through natural market forces.
> If we ladle on an extra helping of steward meddling, we are taking action in contravention of our primary duty to maintain a viable and trusted registry.

    You assert 'conservation via natural market forces'...   While I do believe that 
    such an approach works over a long-term in a perfect market, is there any reason to 
    believe that it will work in the face of precipitous runout?   If there is finite supply,
    absolutely steady demand, and no constraint on recipient to actually use the number
    resources, wouldn't such a market represent a perfect opportunity to corner?  While
    the total size is approx 4.3 billion IP addresses, there is actually a much lower
    number that are readily redeployable, so the total capital commitment would not be 
    unachievable by many investment firms.  When combined with a lack of visibility and
    regulation of any sort, it appears ready-made for speculation (and that is not even
    considering the possibility of informal coordination of price among multiple players)

    Does the 'invisible hand' actually work in environment where to the total resource
    supply is fixed and the market supply is uncertain in appearance, irregular in flow,
    and transactions (including pricing) generally not visible to the other parties?  I
    will note that we can establish regulatory mechanisms to improve market visibility,
    etc., but that very quickly makes one wonder the cost of establishing such systems
    and whether they'll actually meaningfully reduce the risk of market capture.

Thanks for your insights here,
/John

John Curran
President and CEO
ARIN