[ncc-announce] [GM] Final RIPE NCC Charging Schemes for Members to Vote On

Dear all,

We have now published the final RIPE NCC Charging Scheme 2024 options that will be voted on by members at the General Meeting on 24 May, together with an updated calculator that allows you to see how the different options would affect you. This can be viewed at:
https://www.ripe.net/participate/meetings/gm/meetings/may-2023/documentation-and-archives/supporting-documents 

I would like to thank all members who contributed to the consultation on this important topic. A wide range of opinions were shared on many aspects of the RIPE NCC’s charging. Although not every suggestion could be accommodated, we did our best to produce voting options that took your feedback into consideration.

The outcome is that we propose four charging schemes for the membership to choose from, with three votes in total. The projected 2024 income for each option is included for comparison.   

- Vote 1:
Model A: Category-based model, (projected income: EUR 42M)
Model B: Continuation of the “one LIR, one fee” model with a 10% LIR fee price increase (projected income: EUR 42M)
Model C: Continuation of the “one LIR, one fee” model with a 5% LIR fee price increase (projected income: EUR 40M)
Model D: Continuation of the “one LIR, one fee” model that is exactly the same as the 2023 model (projected income: EUR 38M)

- Vote 2: Additional charge for ASN assignments (Yes/No) (projected income: EUR 1.8M)
- Vote 3: Additional charge for transfer requests (Yes/No) (projected income: EUR 1.2M)

We decided to separate the votes for ASN assignments and transfer requests because we think members should have a clear choice on the charging models themselves. There can then be a separate discussion on whether these other charges are appropriate. Note that the income from either/both of these charges would be in addition to income from Models A, B, C or D.  

The Board believes that the category-based model (Model A) will put the RIPE NCC in the best position to manage change in the future. It addresses the perceived unfairness of the current model, based on an objective measure of members’ resource holdings. It spreads the burden more fairly if future price increases are required, and it allows us to reduce the uncertainty caused by multiple LIRs and the associated loss of income due to the consolidation of LIR accounts. Comments on the IPv6 category limits have also been taken into account and corrected in the model; the lowest category is now a /29 rather than a /31 as it was in the previous version. Model A introduces a new fee to join the IPv4 Waiting List of EUR 1,000, and a yet-to-be-determined fee before the allocation can be made. In effect, these fees replace the current practice and fees involved with creating multiple LIRs to request additional allocations. More details are in the charging scheme document.    
 
We note that we saw many requests for a pure usage-based model. However, such a model would greatly distort the RIPE NCC’s income dynamics and may present new risks. Making the RIPE NCC reliant on a small number of members for a large part of its income could undermine its stability and independence, and it is reasonable to think these larger companies would want a greater say in the organisation’s governance as a result of their increased contribution. This is why the Board would prefer to see all fees stay within a reasonable bandwidth.
 
The models B, C and D, which are based on the existing “one LIR, one fee” approach, are included not only to provide an alternative to Model A, but also to allow members to determine the level of the fees should they reject a category-based model. 

The Board’s advice to members is therefore to vote preferentially for Models A, B, C and D in that order, and to vote “yes” for votes 2 and 3 on additional charges for ASNs and transfers. Models A and B will provide for a cost-neutral budget compared to 2023 when inflation is taken into account. Approval of the separate charges for ASNs/transfers, together with approval for Models A or B, could see the RIPE NCC receive income in excess of its 2024 cost budget, which is set during the activity planning process every Autumn. However, this does not mean the RIPE NCC’s budget will automatically increase. The budget is set by the Board following consultation with the membership, and members also retain the ability to redistribute any future surplus in the following year.

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Projected Financial Impact of Different Models:

Vote 1:
Model A: Allows for a budget that is neutral compared to 2023 (taking inflation into account)
Model B: Allows for a budget that is neutral compared to 2023 (taking inflation into account) / 10% increase on the per-LIR fee
Model C: Reduction in budget (after inflation) / 5% increase in per-LIR fee
Model D: Significant reduction in budget even before inflation is taken into account / per-LIR fee is unchanged – note that any resulting shortfall may have to be covered by the RIPE NCC’s reserves 

Vote 2/3: When combined with Model A or B this could allow for budget to further develop services. Otherwise, it could provide for a neutral budget (compared to 2023) if combined with Models C or D. 
***

The RIPE NCC Managing Director, Hans Petter Holen, will also present on high level budget development at the General Meeting, to continue the discussion members have started regarding the RIPE NCC’s budget. The Board has paid close attention to this conversation, and we hope it continues as we work to develop the Activity Plan and Budget for 2024. I would like to remind members that it is during this yearly activity planning phase that feedback on the RIPE NCC’s budget and activities is sought and that the present discussion is about how we fund the RIPE NCC’s operations from 2024 onward. 

I would also like to bring your attention to a Board resolution that freezes the IPv4 Waiting List, until a full analysis is carried out on how this might be best accommodated within a category-based charging scheme model and a discussion can be had with the RIPE community on this issue:
https://www.ripe.net/ripe/mail/archives/ncc-announce/2023-April/001643.html 

Finally, I strongly urge you to exercise your voting rights at the upcoming General Meeting. We have charged the members in the same way for ten years, and we are now proposing changes that will have a financial impact for you. We have tried to provide meaningful options for you to consider, and now we pass the responsibility to you, the membership. We ask that you take on this responsibility by registering to vote and participating in the General Meeting.

Register to Vote:
https://my.ripe.net/#/meetings/active

Kind regards,

Raymond Jetten
RIPE NCC Executive Board Treasurer