[arin-ppml] ARIN-prop-176 Increase Needs-Based Justification to 60 months on 8.3 Specified Transfers

[jeffmehlenbacher at ipv4marketgroup.com]

Appreciate the background Michael.  In the past twelve months, we have
had over 300 communications with potential buyers and sellers of IPv4
address blocks.  There was dissatisfaction with 12 months justification
for 8.3 and on February 10, 2012, when 24 months was introduced, it was
met with a collective "shrug of the shoulders" by the prospective buyer
community in ARIN region.  This is what we hear with a very high degree
of consistency:

From prospective buyers--they are loath to continue going back to the
ARIN trough every 90-days seeking another allocation and having to
justify said...but they are equally loath to participate in a specified
transfer and compound technical involvement with legal, business,
administrative involvement only to receive a 2 year supply--and--receive
the added privilege of paying for the benefit of a transfer and
undergoing exactly the same scrutiny for justification of an unused IPv4
block.  They would rather seek a larger block with a 100% measure of
certainty that said will be approved based on 60 months allocation.  One
effort, one time--five years of business continuity and thus the ability
to focus on managing growth.

From sellers (majority are legacy /16 holders)--it has become
increasingly obvious to each that full transfer of their /16 in one
transaction is possible, but rare.  There is a rather narrow market of
companies that could justify such a block size over 24
months--particularly when free allocations to most of these companies
still abound.  So sellers are dissatisfied with 24 months because they
are often forced to split /16s (for example) into a /17 and two /18s. 
If a /16 is split into a /17 and two /18s—you are talking about the
seller applying 3x the technical, business, administrative and legal
effort to transfer unused resources.  Sellers therefore would be more
receptive to engaging in specified transfers if the buyer market was
broadened via 60 month need.  This enables a much higher probability the
entire block could be transferred at one time thus making sellers of
unused IPs much more likely to enter the specified transfer market.

If ARIN adopts a 60 month justification period on 8.3 specified
transfers, I simply do not believe it will materially affect the speed
at which the free pool is or isn't depleted.  There will be those
companies that elect to systematically apply for resources every 90 days
and those companies with financial wherewithal will be much more
inclined to participate in 8.3 specified transfers.


Jeff Mehlenbacher
IPv4 Market Group
Email: jeffmehlenbacher at ipv4marketgroup.com


Date: Tue, 26 Jun 2012 18:11:17 -0700
From: Michael Sinatra <michael+ppml at burnttofu.net>
To: arin-ppml at arin.net
Subject: Re: [arin-ppml] ARIN-prop-176 Increase Needs-Based
 Justification to 60 months on 8.3 Specified Transfers
Message-ID: <4FEA5DB5.6060108 at burnttofu.net>
Content-Type: text/plain; charset=ISO-8859-1; format=flowed

A few months ago, I floated the idea of extending the time horizon for 
8.3 transfers to 36 months. The only comment I got back was an AC 
member (possibly speaking for himself only) making the valid point that 
we should see how things go at 24 months. I agreed at the time.

2011-12 extended the needs window to 24 months and it was implemented 
just about four and a half months ago. Given the short timeframe, I am 
having a hard time understanding the rationale for the proposal; 
specifically how the 24-month window creates significant uncertainty, 
or, more importantly, how we know it to be so. I am sure that a 
registered STLS Facilitator like Jeff has a better window into that 
issue that I do, but I can't imagine it's a good enough window to draw 
such a conclusion.

(It's worth noting that at my most recent job, I was hired on to a 
24-month contract, with no guarantee of re-appointment at the time of my

hiring. Contrary to the implications of the rationale, 24-month time 
horizons appear to be quite frequent in free markets.)

Opposed as written.

michael