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<DIV>Hi Owen,</DIV>
<DIV> </DIV>
<DIV>As for examples of Whois inaccuracy, how exactly would they be
substantiated?</DIV>
<DIV>I can tell you that I am aware of several transactions which have occurred
in this manner, but I am not able to divulge the participants.</DIV>
<DIV> </DIV>
<DIV>However, I was a bidder in the Nortel/Microsoft deal, and I can tell
you that not a single one of the 38 blocks transferred had the name Nortel on it
in Whois. Particularly with legacy space, which has no contract assigned which
mandates any particular form of transfer, the sale or lease of address rights to
another party is legal. This is one of the very few public transactions
which could be mined for proof of Whois inaccuracy, yet it yields
evidence.</DIV>
<DIV> </DIV>
<DIV>You have agreed in the past that it is possible to advertise addresses for
which the name in Whois does not match the name of the advertiser. When you put
the facts together- no legal obstacle to the transaction involving legacy space
and no operational obstacle to the transactions- along with the pecuniary
factors, you have a recipe for off-the books transactions which would be
invisible to the ARIN community.</DIV>
<DIV> </DIV>
<DIV>From my perspective, there are absolutely some buyers and sellers who are
willing to engage in off-the-books transactions, although I will concede that
they are in the minority. </DIV>
<DIV> </DIV>
<DIV>Thanks for considering support for an experiment in removing the needs test
for transactions of a /22 or less per year or in aggregate. I do consider
that size too small to have much of an effect on the market, but even that kind
of policy change might encourage a seller to consider slicing off chunks of his
block and engaging in many transactions with multiple buyers, because one
element of transactional uncertainty-the buyer’s needs test- would be
removed.</DIV>
<DIV> </DIV>
<DIV>I began this discussion off-list with as an attempt to take the community’s
temperature in regards to a potential policy proposal to remove needs-testing of
transfers, at least in a limited way. I hoped that my experience as a broker of
addresses would be informative, and that potential movement in RIPE away from
needs-testing transfers might elevate consideration of such a proposal
here.</DIV>
<DIV> </DIV>
<DIV>Also, can you send me (off list) anybody you are aware of who can consult
on ARIN justifications? Thanks!</DIV>
<DIV> </DIV>
<DIV>Regards,</DIV>
<DIV>Mike</DIV>
<DIV> </DIV>
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<DIV style="font-color: black"><B>From:</B> <A title=owen@delong.com
href="mailto:owen@delong.com">Owen DeLong</A> </DIV>
<DIV><B>Sent:</B> Tuesday, June 18, 2013 4:14 PM</DIV>
<DIV><B>To:</B> <A title=mike@nationwideinc.com
href="mailto:mike@nationwideinc.com">Mike Burns</A> </DIV>
<DIV><B>Cc:</B> <A title=arin-ppml@arin.net
href="mailto:arin-ppml@arin.net">arin-ppml@arin.net</A> </DIV>
<DIV><B>Subject:</B> Re: [arin-ppml] A Redefinition of IPv4 Need post
ARINrun-out(was:Re:Against2013-4)</DIV></DIV></DIV>
<DIV> </DIV></DIV>
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<DIV>
<DIV>On Jun 18, 2013, at 7:14 PM, Mike Burns <<A
href="mailto:mike@nationwideinc.com">mike@nationwideinc.com</A>>
wrote:</DIV><BR class=Apple-interchange-newline>
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<DIV>Hi Jason,</DIV>
<DIV> </DIV>
<DIV>1. It has been argued that the larger ISPs have the prior advantage of
holding highly valuable alienable assets which they received for free, which
provide them with a competitive advantage over less endowed entities seeking
to purchase addresses at a much higher relative price.<SPAN
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<DIV> </DIV>Yes, it has been argued. It hasn't necessarily been
substantiated, nor has anyone raising said argument provided any real evidence
to support it.</DIV>
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<DIV>2. It has been argued that larger ISPs have greater experience and
resources required to navigate the justification process, which provides them
with a competitive advantage over less experienced smaller
entities.</DIV></DIV></DIV></DIV></DIV></DIV></DIV></BLOCKQUOTE>
<DIV> </DIV>Again, argued, but not neither of the above statements has
necessarily been substantiated.</DIV>
<DIV> </DIV>
<DIV>For example, a number of smaller ISPs have hired consultants to help them
navigate the justification process. These consultants cost much less than the
FTEs employed by the larger ISPs in support of the process, so, it could be
argued that smaller ISPs have a competitive advantage because of that reduced
cost of expertise.</DIV>
<DIV> </DIV>
<DIV>I'm not sure that argument holds water, either, but I don't completely buy
into all the "competitive advantage" arguments about the larger ISPs. I think
there are tradeoffs at any size and that while different sizes bring about
different tradeoffs, the ARIN process is, generally, about as fair as it can
be.</DIV>
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<DIV> <SPAN style="FONT-SIZE: 12pt">3. Other registries have enacted
policies restricting access to their last /8s to provide an advantage to newer
and smaller companies through their /22 maximum restrictions. Applying
your logic, this restriction allows the tiny ISP some years of planning, but
larger entities only a few days, so I assume you also reject these policies
for reasons of
fairness.</SPAN></DIV></DIV></DIV></DIV></DIV></DIV></DIV></BLOCKQUOTE>
<DIV> </DIV>Those policies are actually to provide a disadvantage to any
size established company in favor of nonexistent entities.</DIV>
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<DIV>Your post could be read as a plea to remove needs testing transfers
altogether, for both the large and the small, in in the interests of fairness,
which I would also support. I believe the duration of the planning horizon
should be a matter of each business to decide on its own. As of now, that
duration is mandated by ARIN policy, which I believe is unfair and arbitrary.
Unfair and arbitrary for transfers, but not un-necessarily unfair and
arbitrary for free pool
allocations.</DIV></DIV></DIV></DIV></DIV></DIV></DIV></BLOCKQUOTE>
<DIV> </DIV>I do not think that it is unfair or arbitrary to have a
time-horizon limit on the amount of resources one can remove from availability
to others with need at one time. In fact, I think it is quite unfair to
eliminate that limit.</DIV>
<DIV> </DIV>
<DIV>I believe that remains true regardless of whether those resources are being
made available from a 3rd party or from the registry. </DIV>
<DIV> </DIV>
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<DIV> <SPAN style="FONT-SIZE: 12pt">Remember the cap on needs-free
transfers is designed to free up the market to incentivize more transactions,
each of which presumably entails the move of addresses from lower-use states
to higher-use states, while providing some protection for market
manipulations. I don’t believe that market manipulation is a real threat, my
discussion of the cap is in the context of providing some protection for those
who do think it is a threat. I do think un-booked transactions are a
real threat, and the lifting of needs-testing transfers is designed to protect
the integrity of
Whois.</SPAN></DIV></DIV></DIV></DIV></DIV></DIV></DIV></BLOCKQUOTE>
<DIV> </DIV>I challenge you to defend that presumption. I remain utterly
unconvinced that money alone can define the "higher-use" of addresses. Further,
I see no reason to believe that if the protections put in place (including needs
basis) in the current transfer policy are removed that it would be at all
unlikely to see addresses purchased purely for purposes of speculating on the
value of addresses in the future, thus moving them from under-utilized to
perhaps un-utiliized.</DIV>
<DIV> </DIV>
<DIV>I don't know whether market manipulation is a threat or not. If you reduced
the non-needs based cap to /22, I would be willing to accept the experiment. At
/12, it's utterly inadequate protection and I cannot support it.</DIV>
<DIV> </DIV>
<DIV>I don't believe that un-booked transactions are as likely to occur as the
anti-regulation zealots have made them out to be. For the most part, it is quite
clear that those purchasing addresses want the addresses registered as a
condition of purchase, so sellers are forced to go through the RIR system in
order to complete the sales. As such, I'm a lot less worried about whois
integrity (which so far has not been a problem) than about an unregulated market
(which throughout history has proven time and again to be problematic at best in
a multitude of contexts).</DIV>
<DIV> </DIV>
<DIV>Owen</DIV>
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