[address-policy-wg] 2014-02 New Policy Proposal (Allow IPv4 PI transfer)

Hi David,

On 17/04/14 22:02, David Monosov wrote:
> Dear address-policy-wg,
>
> With such a policy in place, IP address broker needs to offers potential IP
> space buyers only a marginally lower price than the cost of being a LIR for the
> expected duration of use of the IPv4 PI space in question (and requesting this
> IP space from the last /8 or realizing an inter-LIR PA transfer) in order to
> create a perverse incentive for IPv4 address buyers to line the pockets of IP
> address brokers instead of stepping up and becoming members of the RIPE NCC.
>
> This policy appears to fail the most basic economic incentive test, and will in
> practice create a secondary and desirable 'asset class' from which IP transfer
> brokers benefit considerably more than the community as a whole.
There is already a market of IP addresses. Nobody will care about the 
color of the IP addresses once they will really need those numbers.
> To deconstruct the arguments which purportedly support this proposal:
>
> a) "Currently the policy for PA and PI space isn’t the same and people don’t
> understand the difference between the various types of IP Space."
>
> Ignoring that this is a superfluous argument which goes in the face of nearly
> two decades of policy, this appears to argue that letting PI space be sold would
> somehow eliminate this distinction.
>
> This, of course, is disingenuous. If this is indeed the goal, a policy should be
> introduced to allow PI space to be converted into PA space and assigned to a LIR
> - this will enable its "transferability" and eliminate many of the concerns
> raised above by ensuring that all holders of "transferred" IPv4 space are first
> rate LIRs who contribute financially toward the operation of the RIPE NCC and
> fall under all obligations imposed on such.
Are you saying that every holder of PI space should become an LIR before 
they could transfer it?
Why would they pay €3600 (1600 for the yearly membership and 2000 for 
the sign-up fee) to the RIPE NCC when they could just do it in a contract?

Or are you saying that PI holders should just give their PI to the 
friendly LIR which can then convert it to PA and transfer it? Who will 
make the buck then?
Should the PI holder retain any rights once the address is transferred 
to the 'friendy' LIR or will the LIR be allowed to just transfer the new 
allocation to whoever they want?
> b) "There is already some trade in PI space, however it is not documented or
> registered, which doesn’t help to keep the registry updated."
>
> This is also disingenuous, as every IPv4 PI space holder has a contract with the
> sponsoring LIR (and indirectly, with the RIPE NCC). This LIR can, and should,
> regularly verify and update these details in cooperation with the registrant.
let's think about this scenario..You are an LIR and you have 500 PI 
customers for which you are Sponsoring LIR, you will probably call the 
PI holder or send him an e-mail to verify that they still exist because 
at least once a year you will be paying a fee to the RIPE NCC for the 
maintenance of that PI. If the PI holder says that he still has the same 
contact details and the IP addresses are still used, what resources will 
you invest to verify that the holder of the address space is still the 
one documented in the RIPE Database?
- do not forget, you (as LIR) pay €50/year for the maintenance of the 
resource to the RIPE NCC and probably make (in average) 
€25-50/year/resource yourself...

I think that bringing in the registry/database all the PI transfers that 
currently happen without proper registration/update is the most 
important goal which this proposal will achieve.
> c) "A lot of current PI space holders are more than happy to have their
> assignments re-assigned to other parties, but due to the current policy it is
> not possible. The same goes for the documentation provided to the RIPE NCC
> during mergers or acquisitions of infrastructure with PI space. Due to the
> current policy, some changes in company names are marked as mergers or
> acquisitions when they are actually a transfer of IP space with added
> documentation to make it look like an merger or acquisition of infrastructure."
>
> If a legitimate transfer has occurred as part of legitimate organizational
> restructuring, there is no disincentive to document it. The disincentive only
> exists if the registrant fears the transfer's legitimacy may be questioned,
> which is exactly the intention for non-transferable, end-user assigned PI space.
> Such transferred allocations could, and should, per current policy, be simply
> reclaimed.
Who will give up their address space? The numbers are now considered 
assets and may be worth a buck or two...
Or would you rather see PI never transferable and the RIPE NCC 
reclaiming it when it's no longer needed?
> d) "We want to have an open and honest communication to the RIPE NCC from the
> community and we need to make sure that the registry is up to date, without
> having to fluff up the procedures, bend the rules and truth in communication to
> the RIPE NCC to be able to transfer the IP space."
>
> Alternatively, elements which "bend the rules and truth" could be identified,
> and, within reason, have their resources reclaimed. Certainly, such enforcement
> can never be perfect - but speed traps also do not catch 100% of speeding cars.
Please come up with a proposal for this reclamation process; I'd really 
love to see it on the mailing list.
> With a few documented instances, this would create tremendous uncertainty and
> disincentive to engage in such practices from the buy side, as it will mean that
> any resources acquired in this manner may very suddenly get written off.
So, once the RIPE NCC would reclaim something that was transferred 
without it's approval, it should tell the whole world? What about the 
privacy of the communication that the RIPE NCC is so proud of? How would 
you document such an instance?
> e) "The goal of this policy change is to get PI space on-par with PA space in
> respect to the ability to transfer it."
>
> See (a). It seems very disingenuous to make PI and PA "equal for purposes of
> transferability" but maintain the distinction in all other aspects.
There will no longer be many distinction between PI and PA. The only one 
I can think of is that PA can be further assigned. Maybe we should come 
up with a policy proposal to allow PI sub-assignments and remove the 
differences between PA and PI in that process? I only see a problem, the 
same one I faced with IPv6 unification, the fee unification.
> To summarize, I strongly object to this policy in its current form.
>
> I concur that the mobility of IPv4 PI space toward those who value it most is
> desirable - on the condition that this mobility occurs as part of a wider reform
> to eliminate the distinction between PA and PI status of IPv4 resources.
This policy proposal is the first step, you could try and make the next 
step and propose a bigger change. From my experience (just last year) 
the community gets scared when you start talking about big changes (I 
was trying to unify IPv6 PA and PI, without even having all the 
conspiracy theory about brokers flying around my ears). These big 
changes will never work.
> This should result in equitable burden for all resource holders toward the RIPE
> NCC instead of lining the pockets of IP address brokers by helping address space
> speculators which presently hoard IPv4 PI assignments against policy realize
> profits at the expense of the community.
IP brokers can and are already helping others to get the address space 
they need by brokering PA transactions. Why do you think that enabling 
IPv4 PI transfers will be the benefit of only the Brokers?

I think this policy proposal is in the benefit of us all:
- cleaner registry
- all holders of address space (PA or PI) can monetize it equally ;)
- remove any temptations to 'bend the rules'

PS: I hope you do know that a transfer can happen without brokers having 
to be involved. Actually, I am under the impression that most of the 
transfers (in numbers of transfers and not of IPs) have been made by 
LIRs mutually agreeing to the transfer via the Listing Service and not 
via brokers/escrow. When it comes to large blocks and a lot of money, 
some prefer to have a broker in the middle, for the safety of both parties.
> --
> Respectfully yours,
>
> David Monosov
>
Kind regards,
Elvis
-- 
<http://v4escrow.net> 	


  Elvis Daniel Velea


    Chief Business Analyst

Email: elvis at V4Escrow.net <mailto:elvis at v4escrow.net>
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