[address-policy-wg] 2007-08: response to ETNO position

On 4 jun 2008, at 12:59, <michael.dillon at bt.com>  
<michael.dillon at bt.com> wrote:

>> Let me first rephrase what 2007-08 is about, before
>> responding to ETNO's position. 2007-08 is about setting up a
>> framework for (IPv4) resource transfers between LIRs. Nothing
>> more, nothing less. No IPv6, no ASNs. No PI, no ERX. It is a
>> framework in the sense that, in my opinion, it encompasses
>> the absolute minimum set of policy changes required for this
>> to happen without immediately shooting ourselves in the foot.
>> It is a starting point, not an end point for transfer policies.
>
> However, we already have a framework for IP address transfers between
> LIRs which works substantially the same in all RIR regions. If it
> involves a change in corporate ownership, you simply need to show
> proof of the change and that the network is still operating under
> the new entity. The RIR then updates all records showing the new
> ownership. Or you give the address block back to the RIR because
> you no longer need it, and some other LIR will get those addresses
> at some point in the future.

This is hardly the same, your talking about mergers in which one of  
the LIR's will be closed at the end of the procedure. Further this  
procedure (ripe-301) doesn't talk about reclaiming address, to quote  
the docuent:

"Transferred allocations containing a large amount of unassigned  
address space may be set aside and kept by the RIPE NCC until the  
other allocations held by the LIR are considered fully used (about  
80%). Once the LIR has reached full utilisation in its other  
allocations, the reserved allocations will be made available to the  
LIR."

Which, if you're building reserves for after 2012 is acceptable and  
might even help getting  away from the tax collectors, should there  
ever be such time (which I hope will never happen) where IPv4  
addresses are considered a taxable asset.

> This framework works. There is no reason to believe that it would
> cease working as IPv6 deployment picks up. Most network operators
> are undertaking some form of audit of their internal use of IP  
> addresses
> in preparation for the shortage, which means that as IPv6 picks up,  
> they
> should know when they have surplus IPv4 addresses and can return them
> to RIPE or whatever RIR they came from. If it is not broken, then
> why would we want to change this framework?

Wether we like it or not, there will eventually be some form of  
market. It might even be your scenario where people simply buy the  
whole company, including the registry, to get their hands on unused  
resources or where the value of the company will be depending on the  
number of unused and available resources.

Should this situation become reality, I don't see much people giving  
back stuff which they can sell for cold hard cash.

> You claim that this will speed up the process of transfers but I  
> cannot
> see how adding a new set of transfer rules will speed up anything.
> Even though you claim that this is an LIR-to-LIR transfer without
> RIPE involvement, this is not true since there are various rules
> which RIPE must administer and RIPE can disallow a transfer if,
> for instance, an LIR has received a re-allocation within the
> past 24 months.
>>

Which will protectr the market, should there be any, from speculation  
and maybe even from emerging at all.

>> 2) Transparency
>
>> I fully agree on transparency. What I fail to see is what is
>> meant with 'public way' and why 2007-08 would fall short of
>> that mark.
>
> Because under 2007-08 two LIRs can secretly negotiate and execute
> a transfer or addresses under some secret set of terms which may
> or may not include payments of cash. RIPE only gets involved at
> the end of the process to update the database, and the terms of
> the exchange are never disclosed.

And where exactly does this differ from ripe-301 ?

>> When
>> IPv4 space moves hands because of a merger or acquisition
>> this doesn't happen either. That's all current bottom-up policy.
>
> During M&A activity, it is public who receives the functioning network
> assets, and that is the criteria (technical justfication) for  
> allocating
> IP addresses to the new network owner. The IP addressing aspects are
> still open and public.

I find this a pretty big claim, M&A procedures aren't that public, if  
your lucky both parties involved have to comply to stock  market  
regulations, but still it usually is only announced when the deal is  
already made.

I also can't see, not being involved directly, which of those  
transferred resources are being put aside by the NCC, the only thing I  
can make up from public records is there has been some form of merger  
and resources are now assigned to a new LIR and maybe I can find a  
newspaper article on what happened to the company.

I also can at least give you one example where addresses have been  
transferred between two LIR's in the aftermath of a bankrupcy, where  
301 wasn't applied and both the losing as the recieving registry kept  
operating indepently.

>> 3) Fair and neutral reuse
>>
>> All recovered address space should be recycled in a globally
>> synchronized fashion. RIRs should work harder recovering IPv4 space.
>>
>> I think that this is a good idea, but let's not overestimate
>> what IANA and the RIRs are able to recover.
>
> Under 2007-08, you are right that the RIRs will not recover much.
> But if we leave the transfer framework as it currently is, then
> most IPv4 addresses that become surplus due to IPv6 deployment,
> will go back to the RIRs. Here ETNO is supporting the current
> framework because it provides fair and neutral terms for reuse
> of addresses.
>
> To get addresses, everyone must provide a technical justification.
> When that justification goes away, everyone must return the
> addresses to RIPE unless there is some imminent new technical
> justification in their own organization, for instance shutting
> down dialup services in a company who is still growing VPN or
> Internet access or broadband business. Reuse, happens naturally
> and no new policies are needed.
>
> It would be nice for RIPE to remind LIRs about returning IP addresses
> and set some guidelines such as don't bother until you have more
> than a /24, if you expect an adjacent block to become free within
> 6 months then wait before returning, etc. That could be done without
> making fundamental changes to the transfer framework.

I think this is a prime example on where theory and everyday life are  
completely different, there isn't much space returned and knowing that  
once you return resources it will only get harder to ever get them  
back will only hold people back from returning address space.

>> 5) No connection between IPv4 and IPv6
>>
>> Policies we make for the 'afterlife' of IPv4 should not
>> affect any policy with regard to IPv6.
>>
>> Yes. 2007-08 is in compliance with that.
>
> Unfortunately, 2007-08 will lead many to think that selling
> address blocks is OK in the RIPE region. As a result, this does
> affect IPv6 since if an IPv4 address block is a saleable asset
> then IPv6 addresses are also saleable assets.

Let's, for the sake of the argument, assume IPv6 is indeed infinite  
(ignoring the 'classfull' behaviour in current v6 policies), why would  
I ever want to buy IPv6 addresses as I can get brandnew ones for  
almost free at the RIR around the corner ? And if there is no reason  
to buy, there won't be a reason to sell either.


>> In describing transfers, ETNO argues that transfers are the
>> first step towards a market. That is false. It is the first
>> step towards a market under the control of the RIRs and the
>> current bottom-up policy process we all know and love. A
>> market will evolve whether we accommodate it or not.
>
> Focussing just on the last sentence it is clear that you
> believe a market will evolve, and that 2007-08 "accomodates"
> a market. That is precisely where ETNO disagrees. ETNO believes
> th000at a market can be prevented from evolving if RIPE takes the
> correct actions, and that "accomodating" a market is a wrong
> action for RIPE to take.
>
> Remember that collectively, ETNO members have a huge number of
> IPv4 addresses allocated. If they do not participate in any
> attempts at forming a market, then the market will be stunted,
> and lack liquidity. In addition, when the shift to IPv6 begins
> in earnest, because vendors have fixed the problems which are
> still blocking it, ETNO member companies will be deploying
> IPV6 rather quickly. This will result in a significant percentage
> of their IPv4 addresses returning to RIPE for reallocation.
> That event will kill any existing market for IPv4 addresses.
>
> So the best possible scenario for an IPv4 market will be a trickle
> of transactions put on for show then a runout of IANA's free pool  
> followed
> by a sharp increase in small block transactions by some players trying
> out the market. At this point prices will sharply increase causing
> buyers to back out of the market unless they are in desperate straits.
> Then IPv6 deployers will begin giving some addresses back to RIPE
> at which point the market collapses.
>
> Frankly, it would be better for this to play itself out in a
> black market scenario without RIPE involvement.
>>

And in the mean time also the ETNO members get spammed/scanned/hacked  
from one of those black market address blocks. Who do you turn to ?  
The original LIR ? What if it's a part of a pre-RIR block ?

>> Inaction is not a sign of good stewardship. So we need to be
>> seen doing something, preferably something that will make a
>> difference.
>
> You are right. It is time for RIPE to take more action to help
> LIRs audit their supply of addresses and to set some reasonable
> guidelines for returning unused IPv4 addresses. Since addresses
> are only usable in aggregate, and since LIRs could potentially
> increase those aggregate block sizes with sensible internal processes,
> it is time for RIPE to work on a best practices document for
> IPv4 addressing.


It's probably unnecessary to state I'm also against the active  
development of a market, I do however support 2007-08 because reality  
tells me there already is a market, people are requesting PI spae for  
a living. I would rather see the RIR's as a title agent so that market  
is as transparent as it can be and we can even put a dampening effect  
on it, by for instance prohibiting the re-transfer of a block wihtin  
24 months.

Finally on your comment on auditing address space needs, doing a  
little digging on the database for one of the etno members, I would  
love to see that  /11 return to the unallocated pool.

Groet,

MarcoH
(no hats, just hair)