[arin-ppml] ARIN as a public interest business

[John Curran]

On Feb 22, 2012, at 11:44 PM, mike wrote:

> Hello,
> 
> 	I am a small ISP and a small business that has 4 employees and under $1m/yr revenue. I depend on my ARIN as/ip assignments because my business model demands the technical features that only being an AS with PI IPv4 space can provide. I am very unhappy however with the price I pay yearly to ARIN, which operates apparently in a vacuum and in complete ignorance of fiscal responsibility, witness the squandering of it's funds which then have to come out of my pocket. I work my tail off for every dollar I make and every time I send a check to ARIN it makes my blood boil knowing how you spend it.

Mike - 

Thank you for your message; it's actually quite helpful to hear such focused 
feedback.  As was noted earlier, we have an arin-discuss at arin.net mailing list 
for discussion of member matters such as fees, but I will provide some brief 
responses here and would encourage further discussion on that list.

> I can do without:
> 
> 	The 'team arin' comics - https://www.arin.net/knowledge/comic.html

Myself as well - I "killed" the Team ARIN comic series several years ago.  
These were particularly effective at communicating background about IP 
addresses to audiences such as elected officials and press, but quickly 
reached diminishing returns and hence were cut from our program budget.

> 	The personal phone calls from ARIN staffers regarding elections I don't care about that I get every year.
> 
> 	The refrigerator magnet advising same.
> 
> 	The hand signed paper mail letters about same.
> 
> 	... and on and on and on....

Yes, we do spend a small amount of money each year in contacting members 
via reminder cards about the upcoming elections, as well as have the staff 
dedicate several days to calling members with reminders about the election.  
The direct costs are low (~$20K each year) and the imputed staff costs are 
modest (about $40K).  The benefits of the member outreach is a higher election
participation rate (e.g. 14% of the total eligible organizations cast ballots
in the 2011 Trustee elections) as well as several organizations each year 
update their contact information as a result of the election member outreach.

You indicate that you don't care about elections, and I would ask that you
at least consider voting for ARIN Board of Trustee candidates. The Trustees 
oversee the development of ARIN's budget and fees, and therefore electing 
candidates who hold the same beliefs as yourself regarding ARIN's budget and 
fees is the most certain way of directing the organization.  You can determine 
the views of the various candidates from the questionnaires that candidates 
answer and are available online during the election process.  

> 	I would love to know, if ARIN was forced to operate like a business, how cheaply could ip resource assignments be made? Do you think some of these 'expenses' could be trimmed so that my next bill due is smaller than the year before?

We actually operate very much like a business, and the Board actively considers the 
right balance of ARIN's budget and fees (based on guidance received from the members 
both on these mailing lists and the members meetings.)  There are two aspects to the 
fees: how ARIN distributes costs among the members via fees, and what are the total 
costs of the operation.  Mr. Woodcock raised some questions about cost distribution 
in his email on fees (and we would welcome your feedback there) and I will deal with 
the total cost containment issue.

At the request of the Board, we have just completed introducing program-based cost 
accounting (as opposed to functional or "department" measurements) so that we can 
better understand ARIN's costs of various programs and make sure that we're being
cost-effective in delivering on mission goals and services.

I presented the most recent numbers at the recent Philadelphia ARIN Members Meeting, 
and will summarize below: 

From: <https://www.arin.net/participate/meetings/reports/ARIN_XXVIII/PDF/friday/curran_cost_breakdown.pdf>
 
  Expenses through August 2011 - 

 	Program Area		Program Exp.	(% of Total)
	------------		------------	----------
	
	Registry Service	$ 2,946,836	(31.69 %)

	Registry Development	$ 4,641,148	(49.91 %)

	ARIN Organization	$ 602,854	( 6.48 %)

	Internet Governance	$ 1,108,217	(11.92 %)

Approximately half of ARIN's ongoing expenses related to "Registry Development", 
and this includes the costs of running the policy development process, the portion 
of the public policy meetings which support policy development, the development 
activities for ARIN Online in support of policy changes, etc.  One of the most
significant questions in ARIN's future is whether the amount of IPv4 policy 
development activity will drop in the near-term future, as this would allow ARIN 
to reduce the rate of ARIN Online changes and consider options to make policy 
development efforts more cost-effective.

It is also true that ARIN has considerable expenditures in Internet Governance,
and this is the result of increasing activities within ICANN, the IGF (Internet
Governance Forum) and international bodies such as the ITU, where issues about
Internet number resources and policy are increasingly being discussed.  Again,
to the extent that we can achieve more stability in this area, we can work to 
reduce this amount either by participating in less activities or gaining the
ability coordinate participation through related organizations such as the NRO
or the Internet Society.

It is reasonable to think that ARIN should be able to lower its cost structure
significantly over the coming years if there is more stability in the policy and 
Internet governance areas, and this should result in fee reductions even absent 
any structural changes in the fee distribution among members... Note - ARIN has 
consistently lowered fees over the years as soon as cost efficiencies have allowed 
(and this has resulted in 4 fee reductions since we started operations.)
  				
> And how could customer service at ARIN improve if under a business model where customer satisfaction was actually a stated goal, instead of just an accidental by-product that nobody currently is responsible for providing, and people could actually get fired for being mouthy and rude unlike today's academic institution/tenured professor immunity to consequences attitude that exists now?

If any member of the staff has been anything other than professional and 
respectful during your dealings with ARIN, please feel free to contact me 
directly (jcurran at arin.net, cell + 1 617 512 8095) at any time.  While we 
cannot commit to approving all your requests, you are entitled to have 
professional and respectful communications at all times and you may hold 
me directly accountable on this matter.

I apologize for this lengthy response, but wanted you to know that your
feedback is important and appreciated.  Feel free to contact me directly
if you want to follow-up further in any manner.

Sincerely,
/John

John Curran
President and CEO
ARIN