[arin-ppml] ARIN-prop-165 Eliminate Needs-Based Justificationon 8.3 Specified Transfers

[John Curran]

On Feb 17, 2012, at 11:07 PM, Milton L Mueller wrote:

> Anyway, a tip of the hat to the proponents of ARIN-prop-165 for their effort; you showed a touching faith in the RIR policy making process. This has been tried several times before, the result is always the same: the sheep start bleating "needs assessment good, markets bad" 

Milton -

The community response to these proposals for an unconstrained 
market is more reasoned that your summary would suggest. There
already is a limited market mechanism through the existing policy
for specified transfers; this alone is recognition that markets
are not inherently "bad" but do serve as a viable mechanism for 
getting limited resources to the folks who have need for them.
Markets have an added benefit that the pricing incentive works
on resources that are already distributed, whereas the historic
approach to distribution from a centrally managed available pool
provides no meaningful incentive for getting resources that are
underutilized back into productive use.

If the community were solely concerned with the requirement of
improving the utilization of the fixed size pool of numbers in 
order to maximize availability, then it is fairly clear that a 
unconstrained market would suffice for this task.  There are 
some interesting questions that arise from the market approach
(see John Sweetings questions to you of 17 Feb 17 12:55:52 PM)
which remain unanswered about how such an unconstrained market
would remain fair, but I'm told those are type of questions that 
economists deal with all of time and presumably can be addressed.

However, the inherent questions of how and when markets work is
_not_ the only concern that is being expressed in the discussion,
and that is likely because there specific requirements being met 
by the present system which have not been answered by the various
market advocates, specifically how markets would protect the "fair 
distribution of globally unique Internet address space according to 
the operational needs of the end-users and ISPs operating networks 
using this address space" and the "distribution of globally unique 
Internet addresses in a hierarchical manner" so as to encourage
address aggregation to the extent possible (refer to the first 
page of IETF BCP12, aka RFC 2050, for this statement of goals.)

As the present specified transfer policy requires need assessment 
in the same manner as allocation/assignment from the available pool, 
transfers automatically inherent certain mechanisms that serve to 
protect these underlying goals of the Internet number registry system:

- Address transfers are indirectly limited in size by "need", which
  protects fair access by all to number resources in the presence 
  of extremely large players (i.e. Mr. Sweeting's earlier query) 

- Address transfers must be of a minimum size, which serves to 
  prevent deaggregation which could otherwise occur in markets
  as resources are packaged into sizes to maximize $$$ return.
 
Presuming that a policy proposal emerges for a less constrained market 
mechanism, it would be useful to hear how it addresses the above goals. 
This is the discussion that many are trying to have on the list; it 
would helpful if you would help raise it above reporting on bleating 
and waiving of invisible hands.  It is incumbent upon those who advocate 
change to argue the merits of their case, but we have yet to hear how
elimination of the needs-based assessment for an unconstrained market 
will still satisfy the goals of the Internet number registry system.

Thanks!
/John

John Curran
President and CEO
ARIN