[arin-ppml] Revised and Retitled - Draft Policy ARIN-2021-6: Permit IPv4 Leased Addresses for Purposes of Determining Utilization for Future Allocations

[Scott Leibrand]

It seems that lots of people oppose this policy based on their assumptions
about what it will do to the economics of the IP address transfer market,
but no one is making those assumptions explicit or describing what exactly
they think would happen if it were passed.

Right now https://auctions.ipv4.global/prior-sales is showing recent prices
of about $55 per IP (to buy them on the transfer market), up from about
$30/IP a year ago.

Right now https://www.heficed.com/lease-ipv4/ is quoting $0.50/mo per IP
($546 for 1024 addresses). The data at
https://www.ipxo.com/blog/leasing-vs-buying-ip-addresses/ is a bit older,
but indicates that in late 2020, prices were in a similar range of $0.34 -
$0.67 per IP.

If someone buys addresses at $55 each and leases them out at $0.50/mo, it
would take 110 months (9 years) to cover the cost. That would be a lousy
business, so clearly, entities leasing space are expecting IPv4 purchase
prices to continue rising more quickly than their cost of financing, and
expect to be able to sell any addresses they buy at a profit.

Leasing is clearly already happening. Right now it has to be done using
RIPE space or by an entity that has (at least nominal) network connectivity.

If you oppose or support this policy on grounds that it will affect the
supply and demand of addresses, can you be more specific as to what effects
you expect relaxing the justification requirements for those offering IP
leasing who want to buy more space to lease out would have? How would this
policy affect the demand and price of IPv4 addresses bought and sold on the
transfer market? How would that affect the supply, demand, and price of
IPv4 addresses available for lease? How would that affect network
operators? Would more of them switch from purchasing addresses to leasing
them? With leasing (currently) being cheaper than purchasing (because a
purchase is also an investment in a currently-appreciating asset), would it
help or hurt network operators for leasing to be considered a more
legitimate option?

-Scott

On Fri, Mar 11, 2022 at 10:02 AM Fernando Frediani <fhfrediani at gmail.com>
wrote:

> On 11/03/2022 14:56, Tom Fantacone wrote:
>
> Bill,
>
> We can quibble about semantics, but let's go with your verbiage:
>
> If I run a network and qualify for an /18 right now, can I go to ARIN and
> lease one?   I must either *pay someone to release their addresses to
> ARIN to lease to me* or lease one from a (non-ARIN) 3rd party.
>
> And that should always be the expected, release them to ARIN which should
> be the only actor taking care of it.
> I really fail to understand how can one consider legit that a 3rd party
> could be doing this job otherwise.
>
> If everybody sticks that what is expected, things work better, is much
> better to trust ARIN to do this plus in the end doing in such way doesn't
> least space for speculation, price rises and community have the assurance
> that the one who is intermediating it is someone really neutral and with no
> other interests to the business other than make sure the policies are being
> followed.
>
> Fernando
>
>
> And the amount I must pay (commonly referred to as the Purchase Price in
> most IPv4 transfer contracts, whether I'm technically "buying" it or not),
> is significantly more than either typical lease rates or ARIN's annual
> fees.  My point is that 3rd party lessors do provide a service that ARIN
> does not.
>
> Regards,
>
> Tom Fantacone
>
>
>
> ---- On Fri, 11 Mar 2022 12:42:52 -0500 *William Herrin <bill at herrin.us>
> <bill at herrin.us>* wrote ----
>
> On Fri, Mar 11, 2022 at 9:40 AM Tom Fantacone <tom at iptrading.com> wrote:
> > If I run a network and qualify for an /18 right now, can I got to ARIN
> and lease one? I must either buy one on the transfer market
>
> Tom,
>
> I think you misunderstand the transfer market. You don't buy addresses
> on the transfer market. You lease addresses from ARIN and then pay
> someone on the transfer market to release their addresses to ARIN for
> lease to you.
>
> Regards,
> Bill Herrin
>
>
> --
> William Herrin
> bill at herrin.us
> https://bill.herrin.us/
>
>
>
>
> _______________________________________________
> ARIN-PPML
> You are receiving this message because you are subscribed to
> the ARIN Public Policy Mailing List (ARIN-PPML at arin.net).
> Unsubscribe or manage your mailing list subscription at:https://lists.arin.net/mailman/listinfo/arin-ppml
> Please contact info at arin.net if you experience any issues.
>
> _______________________________________________
> ARIN-PPML
> You are receiving this message because you are subscribed to
> the ARIN Public Policy Mailing List (ARIN-PPML at arin.net).
> Unsubscribe or manage your mailing list subscription at:
> https://lists.arin.net/mailman/listinfo/arin-ppml
> Please contact info at arin.net if you experience any issues.
>
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <https://lists.arin.net/pipermail/arin-ppml/attachments/20220311/23ffe16b/attachment.htm>