[arin-ppml] FW: In favor of 2012-01

[Milton L Mueller]

The following message was sent to RIPE's address policy list last week in connection with the discussion of its inter-regional transfer policy proposal, but apparently has been censored. I copy it here because the discussion is relevant to all regions. Anyone who knows who "moderates" RIPE's list might want to bring this problem to their attention. 

-----Original Message-----
From: Milton L Mueller 
Sent: Thursday, April 05, 2012 4:12 PM
To: address-policy-wg at ripe.net
Subject: In favor of 2012-01



> -----Original Message-----
> 
> this is exactly the problem. this implies that the ip space is an asset of the
> seller, which it is not. it is a commons, and if it is sparse, as any one has the
> same right to it, it is to be redistributed according to need, fair and equally.

The IP address space is not and never has been a commons. Not for those of us who actually understand the vocabulary of resource economics and know what the term "commons" means. 
For IP addresses to be a "commons" they all would have to be available for use for anyone at any time; i.e., there would have to be no exclusive occupation of it. And of course that doesn't work technically, does it? IP address blocks have to be uniquely and exclusively assigned to specific users to function on the internet. Which means the address pool is not a commons - end of story, full stop, that's it. 

Because IP addresses are exclusively assigned, they can in fact be governed either as common pool resources (in which a governance agency establishes rules regulating the extraction of resource units from a pool) or as tradeable property (in which holders allocate the resources by making trades among themselves). All that matters is which method is more efficient and produces more benefits for Internet users. Leave your religious beliefs in your prayer chapels. 

> the problem is not that space is transfered. the problem is that the seller
> assumes that he has the (absolute) power over it, that it is his own, even if
> the requirements that lead to the allocation or assignment to him isn't valid
> anymore.

If you think that is wrong, apparently you haven't noticed the last 10 years of IP address allocation. 

RIPE and the other RIRs lack the resources to constantly monitor the efficiency and need of specific holders of address blocks _after_ they are allocated and assigned, and they also lack the authority to reclaim resources that they deem are underutilized. In the RIR's common pool governance, resources go out but they rarely, practically never, come back. (It's a reverse roach motel. They check out, but they never check back in.) Apparently, everyone who holds a block already thinks that it's an asset. What a surprise! Not. It is a valuable asset, given that it must be exclusively held and you can't do Internet business without it in appropriate quantities. I can't think of a better definition of an asset than something that is scarce, exclusively held, and essential to operations. 

Therefore, post-IPv4 exhaustion, common pool governance breaks down completely and the best way to ensure efficient utilization of remaining v4 resources is to allow market-based transfers. These transfers should be made as flexible and easy as possible. There is probably no need for holding periods, although they don't seem to do a lot of harm as long as they are 1 year or less. Needs assessment is increasingly arbitrary and pointless in such an environment. I know needs-basis is another item of religious faith in these circles, but the idea that RIR staff can accurately assess "need" given inherent uncertainty about time horizons and technical development, is just wrong. Organizations should be allowed to buy as much of an asset as they think they need, and can afford, in order to advance their business interests. Let the price system sort out who really needs what. 

It should also be obvious that the market for these addresses should be global, not regional. 

Thus, I support proposed policy 2012-01, my only reservation being that the 15 month resale restriction is too long, but again, that is not a fatal flaw as I suspect that any serious purchaser of address blocks will be holding on to them naturally for far longer.