[address-policy-wg] Re: [arin-ppml] Offer to buy IP address block (was Spectrum and IP address reservations)

On Wed, Jul 22, 2009 at 09:18, <michael.dillon at bt.com> wrote:
>
>> More specifically, in this context I think that the tendency
>> to assume that market mechanisms would infallibly convert the
>> fact/existence/ supply of additional loose (de-assignable,
>> transferable, etc.) IPv4 into the enduring condition of
>> greater openness to aspiring new entrants is based on the
>> widespread (mis)perception of individual IPv4 addresses and
>> prefixes as "things" (assets, commodities, etc.), when in
>> fact they actually represent something more like discrete
>> instances of a "generalized  privilege"  or "license" (as in
>> "creative license"
>> even more than "driver's license").
>
> The minimum ARIN allocation to a new ISP is currently a /20.
> Someone recently offered an American ISP 6 figures for a
> /20 block that was acquired as part of a corporate acquisition.
> The ISP declined the offer and returned the block to ARIN.
>
> This could mean that the value of a /20 on the open market is
> 100,000 USD. Since a /20 has 16 /24 equivalents in it, that would
> place the value of a /24 at 6250 USD.

http://xkcd.com/605/

> According to
> <https://www.arin.net/knowledge/statistics/>
> in the first 6 months of 2009, ARIN issued 99,285 /24 equivalents
> to ISPs. That means that ARIN issued 620,531,250 USD worth
> of IP addresses. Over the course of 2009 we can expect some
> 1.2 billion dollars worth of IPv4 addresses to be allocated
> to ISPs, or $103 million per month.
>
> Where is the industry going to find 1.2 billion dollars to sustain
> growth of the network after IPv4 runout? And where is a new entrant
> going to find $100,000 to buy their first allocation, assuming that
> the price doesn't rise even higher when the free alternative no
> longer exists?
>
> Will the prices in Europe be any different than in America?
> Why?
>
> --Michael Dillon
>
> P.S. note that there are more predictable costs to an ISP
> in deploying either carrier-grade NAT or transitioning to IPv6.
> How will this impact IP address block prices and why?
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-- 
Chris Grundemann
weblog.chrisgrundemann.com
www.twitter.com/chrisgrundemann
www.coisoc.org