[address-policy-wg] 2012-01 New Policy Proposal (Inter-RIR IPv4 Address Transfers)

Sorry, in plain text this time....

Thank you for your comments on proposal 2012-01, which I have submitted.
I will undertake to speak to several of the points you have raised.

My opinion on the question of the use of the word "sold" is that I would
also be ok with the word "transfer". I believe this policy can cover two
situations: 1) where related companies, for example ABC-NA transfers a
block from ARIN to ABC-EMEA to RIPE-NCC, and no money is exchanged; and
2) where unrelated organizations transfer a block. Only in the second
case is money likely to be exchanged in order to encourage the sending
organization to initiate the transfer. Thus only the second case is
truly a sale. And let's be very clear that I do mean for money to be
exchanged: in most cases there is work to be done to free up blocks of
IPv4 addresses for re-allocation, and the incentive for entities to do
so is financial benefit. Otherwise, large portions of their blocks will
continue to sit dormant and unused. The entire purpose of the IPv4
address market is to free up dormant, unused IPv4 addresses to fill
needs. 

A number of people have questioned the 15 month window before allowing a
buyer to re-sell. I have had suggestions ranging from 12 months to 36
months. I think the point is that there is some feeling that an entity
could acquire IPv4 addresses with the intent to flip them for profit. I
am not sure this would be possible since at some point, the transition
to IPv6 will make IPv4 addresses a declining value asset. I, for one,
believe in a free market for IPv4 addresses, where no holding period is
required. In a free market for IP's, the price of IP's would move up and
down like the price of a commodity. However, there are artificial
trading rules at play with IPv4, so some window seems to be needed.
Hence, I chose 15 months as a compromise for those who feel that 15
months allows a company to satisfy its IPv6 conversion needs and
possibly be done with IPv4 and be ready to sell them.

To Mr. Blessing's question about an LIR changing its policy, I believe
the answer is that there would be a legal binding agreement between the
buyer and the seller that would cover this situation. The RIPE-NCC
policy does not need to cover the legalities between the two parties. 

I am not sure what the question of a reverse policy refers to? Do you
mean to reverse the transaction? If so, you could add a clause that
states that the two parties can reverse the transfer at any time in the
future or something to that effect. I did have a hypothetical discussion
with Sanjaya of APNIC for a situation that may require this. I was
asking about a potential lease situation where an APNIC member may wish
to lease a block from another RIR. He wondered if the APNIC registry
could initially be updated to reflect the lease, and then once the APNIC
member had completed the upgrade to IPv6, the IPv4 addresses could be
returned to the originator. We then wondered how to reverse the transfer
to return the IP's to the owner. This clause above that Mr. Blessing is
possibly questioning about would take care of lease returns.

I believe these transfers would always be between entities, ie. LIR's.

Mr. Hilliard is concerned about Afrinic losing IP's. Frankly, I have not
looked at oversupply or demand in the Afrinic region. Right now Afrinic
does not have an Inter-RIR transfer policy and by including a statement
that RIPE-NCC will only transfer with RIR's that have a policy, you
allow Afrinic to take care of itself.

Mr. Lenz is concerned about the use of the word "business" purposes.
That is, perhaps, a semantic point. I believe that the word business
should not be taken too narrowly. Business may be defined as an activity
a person or organization is engaged in, and I would just take it at
that.

Mr. Leefman suggested we realign the proposal to a /21 as the minimum
size, and I think that is an excellent suggestion. Other RIR's such as
ARIN and APNIC work with a minimum size of a /24 and I was trying to
keep RIPE in line with them, but frankly that is such as small block,
why bother?

Mr. Leefman also suggested changing the requirements for proving need to
align with the intra-RIR policy. In checking with Mr. Madaio, he informs
me that there have been no intra-RIR transfers to date. That suggests to
me that RIPE's intra-RIR policy needs some rework, if I may be blunt. My
experience with transfer markets in other RIR service areas has shown
three things: 1) that entities need to be assured that their transfers
will be approved, when they put money on the line, 2) that when they
pay, they don't want, or believe that they should have to, go through
the same needs justification process as when they apply for free
allocations, 3) while the period of a free allocation may be fixed (ie 3
months), when a business has a need and a business plan for which it
acquires IP's it is a much longer time horizon, and it is not RIPE-NCC's
role to limit its members business planning horizon to 3 months. (If
RIPE approves me for a three month supply now, I have no guarantee I
will get another 3 month supply in 3 months....I cannot plan or operate
this way!). 

For example, and you may not care about what other RIR's do, but ARIN
has a 24 month supply for a transfer, and as you may know, we are
working to convince ARIN to modify its policy on needs justification for
transfers.

So, I would not support a change in the inter-RIR policy to match your
intra-RIR policy. I would instead suggest that you consider modification
of your intra-RIR policy to match what your constituents need.

Lastly, I like Mr. Van Mook's comments, other than that he opposes the
policy. It is excellent and simple to outline the transfer in and
transfer out options, and as noted above, I concur with him that the
RIPE intra-RIR policy needs clean-up. I guess I thought that was a
bigger mountain than I could climb, but if it is possible to have a
conversation about doing it at the same time, I am all ears. 

Again, thank you for your support, your comments, and your thoughtful
feedback.

Respectfully,
Sandra Brown