[arin-ppml] ARIN-prop-165 Eliminate Needs-Based Justification

[Owen DeLong]

Why in such a circumstance would the seller not choose one of these alternatives:

1.	Fragment the space, sell the /20 to the original buyer and move on to looking for
	additional buyers.

2.	Find a buyer that does have legitimate need for a /16 (If there's value to not carving it up,
	isn't that defined in terms of market demand for the space as a whole?)

3.	Return the /16 to ARIN so that it can be used elsewhere.

Sorry, but, I just don't buy your argument that the seller would rather keep the /16 in inventory making no money than selling it in pieces or selling it to a different buyer that does have need for the full amount. It's illogical in the extreme.

Owen

On Feb 17, 2012, at 1:17 PM, <jeffmehlenbacher at ipv4marketgroup.com> wrote:

> Owen, you are correct to say "Current policy does not do that. It does
> limit the size of the transfer to the justified need, but, it does not
> reject the transfer."
> 
> Please understand however, that when ARIN rejects a specified transfer
> of, for example, a /16 under current policy and concludes, for example,
> that only a /20 is justified...there is little recourse for the Buyer or
> Seller.  They have executed an Asset Purchase Agreement, funds were held
> in escrow for the full /16 and the deal is dead.  The Seller will not
> carve out the unused /16 holding to a /17, a /18 a /19 and two
> /20s-necessitating modification to the current transaction plus 4 more
> transactions and all of the additional sourcing of additional Buyers and
> execution of legal agreements.  The Buyer must seek alternatives which
> may include returning to ARIN for a free distribution of a /20.
> 
> Again, the Seller's /16 remains unused which serves only to add to the
> scarcity of supply and the Buyer has consumed many months in planning
> for the deployment of the now rejected /16.  What purpose has been
> served?  
> 
> Jeff Mehlenbacher
> 
> -------- Original Message --------
> Subject: Re: [arin-ppml] ARIN-prop-165 Eliminate Needs-Based
> Justification
> From: Jeffrey Lyon <jeffrey.lyon at blacklotus.net>
> Date: Fri, February 17, 2012 2:43 pm
> To: Owen DeLong <owen at delong.com>
> Cc: "<jeffmehlenbacher at ipv4marketgroup.com>"
> <jeffmehlenbacher at ipv4marketgroup.com>, arin-ppml at arin.net
> 
> On Fri, Feb 17, 2012 at 2:19 PM, Owen DeLong <owen at delong.com> wrote:
>> 
>> On Feb 17, 2012, at 10:59 AM, Jeffrey Lyon wrote:
>> 
>> On Fri, Feb 17, 2012 at 1:25 PM, Owen DeLong <owen at delong.com> wrote:
>> 
>> Jeff,
>> 
>> 
>> If this policy is adopted, it would enable speculative brokers who wanted to
>> 
>> to maintain inventory without showing need for the addresses. It would
>> 
>> potentially turn IP addresses into a commodities futures market which I do
>> 
>> not believe would serve the community well.
>> 
>> 
>> You say that no purpose is served when a transfer is rejected between a
>> 
>> company with an unused allocation and a company in need.  Current policy
>> 
>> does not do that. It does limit the size of the transfer to the justified
>> 
>> need, but, it does not reject the transfer.
>> 
>> 
>> However, no purpose is served when addresses are allowed to be purchased by
>> 
>> organizations without need and great harm could come from allowing such
>> 
>> transactions if they start occurring on large scale in order to engage in
>> 
>> speculation or worse, anti-competitive practices.
>> 
>> 
>> Owen
>> 
>> 
>> Owen,
>> 
>> As resident devils advocate, I would be remiss not to point out that
>> anyone who stocks IP space they can't sell would soon find themselves
>> out of business thus discouraging others from substantially engaging
>> in the same practice, thus the "invisible hand" fixes the market.
>> 
>> 
>> True, but, it would not be unusual to stock addresses at $10 until the
>> market had high demand and low supply, then try to sell them for $50.
>> 
>> The community does not benefit from that $40 spread. The community is harmed
>> by that $40 spread. Only the speculator benefits from that spread.
>> 
>> The invisible hand is slow to react and easily manipulated by those with
>> resources to do so.
>> 
>> Owen
>> 
>> 
>> _______________________________________________
>> PPML
>> You are receiving this message because you are subscribed to
>> the ARIN Public Policy Mailing List (ARIN-PPML at arin.net).
>> Unsubscribe or manage your mailing list subscription at:
>> http://lists.arin.net/mailman/listinfo/arin-ppml
>> Please contact info at arin.net if you experience any issues.
> 
> Having a test market would not have any impact on the supply and
> demand of the free pool. The free pool would continue to exist as-is.
> The only spread would be in the test market, so those not
> participating are not impacted.
> 
> -- 
> Jeffrey Lyon, Leadership Team
> jeffrey.lyon at blacklotus.net | http://www.blacklotus.net
> Black Lotus Communications - AS32421
> First and Leading in DDoS Protection Solutions
>