[arin-ppml] About needs basis in 8.3 transfers

[Owen DeLong]

On Jun 6, 2014, at 10:04 AM, Matthew Kaufman <matthew at matthew.at> wrote:

> On 6/6/2014 2:31 PM, Owen DeLong wrote:
>> 
>>> On Jun 6, 2014, at 9:59 AM, Matthew Kaufman <matthew at matthew.at> wrote:
>>> 
>>>> On 6/6/2014 7:24 AM, Owen DeLong wrote:
>>>> Removing needs basis from 8.3 transfers doesn’t do that and it has a number of other harmful outcomes as previously discussed.
>>>> 
>>> Can you name a harmful outcome of removing needs basis from 8.3 transfers that doesn't already exist in the form of contracts that lock sellers to future buyers and/or contracts that allow the use of address space by another entity?
>> As I have stated, we cannot block all mechanisms which circumvent policy. Yes, you can still produce the negative outcomes by circumventing the intent of policy. Bad actors will, of course do so. If you have strategies for effectively preventing bad actors from doing so, then I am open to discussing those.
>> 
>> If you just want to use the fact that bad actors can circumvent policy by means we cannot control as a justification for eliminating policy, then this has been discussed and I still find that position unconvincing.
>> 
>> 
> 
> That's only the first part of said justification. First off, lets stop calling them "bad actors": A company with shareholders that knows it will need IPv4 space over the next 3 years has employees that are legally obligated to enter contracts that will ensure that they can acquire that space once ARIN can not longer provide it. These contracts will take the form of right of first refusal, lock-ups, or leasing of space and none of them can be controlled or prevented by ARIN. The employees are not acting in bad faith and the companies are not as a result "bad actors". They are simply participants in a market for a limited resource... no need to assign a value judgement to them.

Why should I stop calling community members who will choose to circumvent the intent of policy in favor of their own greed over the wishes of the community bad actors?

The employees have no such obligation unless the management of the company chooses to move the company in that direction.

> And there will be "needs justification"... only it will be done by the interaction of the market and their CFO... the company will work out how much space it needs over what it believes is a reasonable planning horizon and then use that as justification for releasing the funds necessary to enter into those contracts.

I call BS. This is the somewhat idealized case. The less idealized case is “We can gain a market advantage over our competitors by investing a couple of billion dollars in tying up as much of the available address space as possible.” Sure, no one organization is likely to achieve this kind of capture, especially under current policies. However, remove the needs test from policy and you’ve disabled several of the safeguards currently built into policy in favor of a free-for-all where a small number of companies behaving in this manner could, indeed, prevent the vast majority of competing organizations from obtaining address space going forward.

> Next, I and many others believe that there is a danger to the registry once such a market becomes prevalent. Specifically, that the accuracy of the registry will suffer. It will, more and more often, fail to reflect who is using and/or controlling the use of the address space, instead containing some historical trivia.

Yes, and many people believe in various things ranging from tin foil hats to virgin birth. I prefer to base policy decisions on documented fact rather than religion and FUD.

> I can foresee an avalanche effect, where as the registry becomes less and less accurate, participants in the IPv4 market find it less and less necessary to ensure that their own transfers or leases are reflected in the registry... a sort of "broken windows" effect where it simply becomes more and more acceptable to not care.

That’s certainly one worst case scenario. I would argue that if that were to occur, it would likely drive IPv6 adoption more than it would actually harm the IPv4 situation. YMMV.

> If you think that's a likely outcome, and that such a thing would be bad for ARIN, you should support making it easier for people who are doing perfectly legitimate things to record those things in the registry. I do.

I think it’s a very unlikely outcome and I don’t think it would be bad for ARIN. I think it would be bad for those attempting to continue to use the IPv4 internet if it were to happen, but not hugely so, at least initially. I think it would be a slow progression of increasing pain (much like NAT and CGN have already been).

You keep calling transfers outside of policy “perfectly legitimate”, but in reality, they are not perfectly legitimate. Can we please stop trying to call violators of policy and circumventers of policy intent “perfectly legitimate”?

> If you think that the market prices and the long-term risk created by the introduction of IPv6 make hoarding and speculation or even significantly overestimating ones own need unlikely, then there's no reason to oppose removing specific needs justification as a requirement to record a transfer in the registry. I don’t.

I do not believe that they do this at all. So I believe that there is reason to oppose removing specific needs justification as a requirement to record a transfer in the registry.

Owen