[arin-ppml] IPv4 Transfer Policy Change to Keep Whois Accurate

Chris Engel cengel at conxeo.com
Fri May 13 11:21:57 EDT 2011

> Ola John,
> >  I'll actually disagree with the presumption that incentives towards
> >  gaming will increase with the value of IP address space, if we are
> >  considering a transfer market with needs-based qualification.  While
> >  it is true that there might be incentive to get creative with the
> >  total expressed need to obtain more space than otherwise qualified
> >  for, the existence of a market (if properly functioning) means that
> >  there is some reassurance that additional space will more likely be
> >  available when needed in the future, even if at a slightly increased
> >  price. This actually reduces the pressure to try and game the system
> >  when compared with the present environment and potential that there
> >  will be no more resources in the free pool when you come back later.
> > The other potential form of gaming would by a non-operator speculator,
> >  who wishes to participate in the market (despite having no actual need
> >  at all), and so needs to fabricate imaginary need to be able to obtain
> >  IP space from the market for subsequent monetization.  While there is no
> >  doubt of the incentives involved, there is also significant risk since
> >  intangible IP registration entries are readily corrected in such cases
> >  of fraudulent representations to the registry.
> If the needs requirement can not be met by the buyer, he will have the
> incentive to game the needs requirement.
> If the value of the addresses at question are higher, the incentive will be
> higher, to my mind.
> But you are absolutely correct in that having a vibrant and functioning
> market is the best way to assuage fears of future supply shocks and
> attendant price increases.
> And you are correct in that the incentive to game the system for allocations
> from the free pool is reaching its highest point in the months to come.
> Pray be diligent!
> As far as what you term a non-operator speculator, you see the risk of
> gaming the needs analysis.
> The same risks lead to not-notifying ARIN and continuing to use the
> addresses under the purchaser's name, leaving Whois in more disarray.
> Regards,
> Mike

Actually, I would argue that "manufactured" need would be functionally identical to "genuine" need from the point of anyone forced to make approval decisions based upon that, unless the organization attempting to game the system was incredibly un-artful in their attempt.  How would someone charged with deciding to approve the "IP-Enabled virtual pet rock program" that was simply instituted to grab and hold IP addresses for a time until they were actually needed for a legitimate project or could be sold (at a profit) to someone who had a legitimate need for those addresses..... from a company that legitimately wanted to enter the "IP-Enabled virtual pet rock" business and were simply bad at business planning?  On paper, they'd be identical....the only thing that would be different was the motivation of the organization acquiring the resources....and how could anyone discern that without being a mind-reader?

Note that speculators always risk being left holding the bag when the bottom falls out of the market they are playing with. Risk is inherent in what they do...unfortunately it doesn't seem to curtail their activities very much in most scarcity markets.

Functionally the only things I see a needs based requirement accomplishing in a transfer market is artificially inflating the cost of transfers, increasing the cost for ARIN to administer transfers and creating a new job position among certain companies of "needs justification designer". I don't think it's going to accomplish what many proponents might hope it would very effectively. In a market where acquiring IP addresses is relatively trivial (i.e. unassigned space from ARIN), I can certainly see why there has to be some artificial barrier built into the system to prevent people from acquiring IP space for trivial reasons....with a scarcity market, the cost of acquisition through transfers itself should act as a barrier to that. Anyway, that's how I see it...for whatever it's worth.

Christopher Engel
(representing only my own personal views)

More information about the ARIN-PPML mailing list