[arin-ppml] About needs basis in 8.3 transfers

Mike Burns mike at iptrading.com
Fri Jun 6 10:57:38 EDT 2014

Hi Larry,

"Personally I suspect that without needs testing the "haves" would have had 
it all a long time ago.
I have felt the same frustration, as a small provider, trying to meet the 
80% requirement can be almost
impossible without gaming the system due to numerous small holes in a small 
That said, I worry about any company that could purchase a couple of Billion 
dollars of IPV4."

What is being expressed here is a fear of hoarding in the absence of a needs 
test. A couple of billion dollars of IPv4 at current prices would yield 
about 15 /8s. Even if some company wanted to risk those funds with IPv6 
transition threatening to erase them, there is no single seller who could 
offer 15 /8s, nor would the sequestration of 15 /8s destroy the market, 
since this amount represents just 25% of the estimated market size of 1 
billion addresses. Since the buyer and seller will be disclosed and 
registered under any no-needs policy, there is little threat of a stealthy 
move here, and any buyer seeking to corner or manipulate the market knows he 
does so at the peril of forcing the IPv6 transition.  The best protection 
against this is continued work towards IPv6 and the establishment of a 
reliable, open, and global IPv4 market with at least the same level of 
transparency into registration as we have now.  As a broker, I actively 
sought out speculators to bid for addresses in the Nortel sale. This was a 
prime opportunity to acquire 660,000 addresses at the floor of the market, 
but it was regarded as too risky by almost all. In the intervening years I 
became aware of other opportunities to acquire address space without needs 
tests, but I never found anybody interested in buying addresses on pure 
speculation. In any case, this fear can only reasonably be expressed in the 
context of a complete removal of needs tests, and could not be applied to a 
more limited removal of the needs test such as that proposed in 2014-14.

"Many of us fear that if need is not considered in the transfer market the 
little guys will find that none is available at any price."

We are three years into the open, post-Microsoft/Nortel market and there is 
no evidence of hoarding in my experience. I have never fielded a phone call 
or email from any company or individual seeking addresses they didn't plan 
to utilize at some point, although I have fielded plenty from people seeking 
addresses that for whatever reason ARIN policy would prohibit them from 
registering. Perhaps other brokers on the list might report on their 

"Like it or not the big guys have an advantage. Let's make sure that 
"cornering the market" isn't one of them."

Little guys benefit from the dropping of needs test for small transfers. No 
need to navigate the ARIN process if you just need a /24 and you can't get 
one from your upstream, or not at a reasonable cost, or because you feel 
more secure with your own space, or because you don't wish to game the 
system. Support of 2014-14 would allow small companies to  have this option 
while preventing hoarding or speculation through limits on size and number 
of transfers.  Perhaps you care to comment on whether you might consider 
support of 2014-14 at the current size of /16 or at another size that you 
might feel more appropriate?

Mike Burns

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