[members-discuss] [ncc-announce] [GM] Consultation on RIPE NCC Charging Scheme 2024

My very cynical view is that if invoices to very large LIRs would become significant, someone would eventually start asking whether it is necessary to pay for RIPE NCC ("so why exactly do we pay this amount and what do we receive"). Which brings me to the following.

If we use the BCG matrix to analyze RIPE NCC briefly, it is certainly in the lower left quadrant of the four-cell matrix - a cash cow. The definition for a cash cow is very high existing market share but a low market growth rate. RIPE NCC has reached an enviable position, having been able to expand its membership organically over the years, of being a regional monopoly. There seem to be significant barriers to entering the same market. These include legal (who controls the IP resources in a region and why?), regulatory (ditto, how to transfer such services away from RIR1 to a RIR2 in the same region), economic (there is probably a minimum amount of LIRs required to be able to reach economies of scale and keep a competing RIR in the same region) as well as geographic (each RIR has been created to handle a specific region and receives/received its allocations originally from IANA).



Kaj

-----Original Message-----
From: Clement Cavadore <ccavadore at vedege.net> 
Sent: Wednesday, March 8, 2023 15:07
To: Kaj Niemi <kajtzu at basen.net>; Simon Jan Haytink <simon at ripe.net>; members-discuss at ripe.net
Subject: Re: [members-discuss] [ncc-announce] [GM] Consultation on RIPE NCC Charging Scheme 2024

Hello,

I fully agree with Kaj regarding the reduction of expenses for RIPE NCC
in the case income goes down. Operations were normally working before
the explosion of the number of LIRs, so why not trying to be more
reasonnable in term of budget for the next years ?


Regarding the calculations for option #2, I thing there are some unfair
calculations for independent resources or ASN. 

While a "kinda" agree that ASN should be billed (but maybe only "new
ASN assignations", as current billing procedures are already in place
between LIR and end users ?), I think that having at the same time the
50€ fee *PLUS* having the number of independent resources sponsored
taken into account for the LIR category is totally unfair. 

To be frank, with such a calculation, I think that my LIR would simply
terminate all the sponsoring agreement with all its customers, and
offer them to continue sponsorship, but with a big fee raise. That
wouldn't be an option I'd like to apply to our customers, but since our
PA allocations makes us a score of 2 or 3 on the .xlsx spreadsheet, and
the number of ASN/PI objects makes us 4, the fee difference is quite
huge.

Additionnaly: I don't really understand why extra big LIRs with
millions of PA IPv4 adresses would pay just a little bit more than
"medium" LIRs, having a few thousand IPs.


Kind regards,


Clément Cavadore

On Tue, 2023-03-07 at 11:02 +0000, Kaj Niemi wrote:
> Hi,
> 
> 
> Thanks, the email and the excel made for some quite interesting
> reading. There are a few other reasonable options which were not
> listed on the slide deck from 2021 nor in your email.
> 
> An obvious option would be to reduce budgeted RIPE NCC expenditure to
> the level of forecasted revenue. This is what most normal companies,
> without assured funding, must do.
> 
> Another option would be to charge LIRs for the services they use.
> With this I do not mean IP addresses and ASNs that were mentioned in
> your model but for everything. Someone who is using only basic LIR
> services (IP/ASN assignments, reverse name services) would not have
> to pay for "value-added services" (VAS).
> 
> With VAS I mean RIPE NCC's varied extracurricular activities such as
> outreach, education programs and software development that have
> expanded considerably over the years and have undoubtedly been of
> some value to some of its members. Still, many of the same
> roles/functions are also conducted by membership organizations, NOGs,
> and independent software developers. Imposition of the costs of such
> programs on members, who either don't benefit from or do not use
> them, equates the charging model functioning mostly as an ATM to
> finance the ambitions and initiatives of the RIPE NCC leadership and
> a small group of active advocates.
> 
> Some of us would be happy with a Big Mac meal rather than the
> expensive all you can eat seafood buffet 😉
> 
> 
> 
> Kaj
> 
> -----Original Message-----
> From: ncc-announce <ncc-announce-bounces at ripe.net> On Behalf Of Simon
> Jan Haytink
> Sent: Tuesday, March 7, 2023 11:35
> To: ncc-announce at ripe.net
> Subject: [ncc-announce] [GM] Consultation on RIPE NCC Charging Scheme
> 2024
> 
> Dear RIPE NCC members,
> 
> We would like to re-open the consultation we began with the
> membership in 2021 on the RIPE NCC Charging Scheme model, and we
> would like to carry out that consultation well in advance of the RIPE
> NCC General Meeting (GM) May 2023. 
> 
> In 2021, we presented on this topic at the GM, and we also surveyed
> our members and held an open house to get direct input on the
> charging scheme model that members would like to see implemented by
> the RIPE NCC. The outcome at that stage of the consultation was that
> there were strong cases made for both the current one-LIR, one-fee
> model and for a category-based model that would charge based on the
> number of resources held by a member. A strong case was also made to
> charge for all resources allocated or assigned by the RIPE NCC,
> including ASNs, and to charge a fee for transfers. 
> 
> The Executive Board decided to suspend the consultation in light of
> the war in Ukraine, but we are eager to decide on a way forward on
> this matter together with the membership. 
> 
> One of the main reasons that we would like to advance the discussion
> on the charging model is that we expect many members with multiple
> LIR accounts who received resources in 2021 to merge these accounts
> in the coming year. This means that the income the RIPE NCC receives
> will be reduced by a significant amount and we will need to ensure
> that our charging model allows us to collect the revenue required to
> maintain our operations. We believe that a category-based model would
> be best suited to cover this consolidation risk. Continuing with the
> existing model would mean that an increase in fees for all members
> would be required. Our ultimate goal is to arrive at a charging
> scheme model that will be sustainable for many years to come, meeting
> the needs of the RIPE NCC’s members.
> 
> To help with discussion and to provide something tangible for members
> to assess, we are putting forward two draft models for members to
> review. These models can be summarised as:
> 
> Model 1: A “one-LIR, one-fee” model based on the current RIPE NCC
> Charging Scheme 2023  that also charges for independent resources,
> ASNs, transfers and changes in business structure such as Mergers &
> Acquisitions.
> 
> Model 2: A category-based model that charges per member (not per LIR
> account) and is based on resources registered and that also charges
> for independent resources, ASNs, transfers and changes in business
> structure such as Mergers & Acquisitions.
> 
> In order to allow members to form an opinion based on their own
> situation, we are providing an Excel sheet that will allow you to
> calculate the fees you would pay under each of the draft models. It
> is important to be aware that at this stage, the numbers assigned for
> each item are indicative and would be reviewed in light of the
> discussion with members. We plan to review these figures following
> consultation with the members, and giving input on those figures
> would greatly help to arrive at a good model. 
> 
> You can download the Excel sheet from:
> https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.ripe.net%2Fparticipate%2Fmail%2Fmember-and-community-consultations%2Fmember-calculator-charging-scheme-2024.xlsx&data=05%7C01%7C%7C46ec650a5e4f496b170408db1fd5fed9%7Cd0b71c570f9b4acc923b81d0b26b55b3%7C0%7C0%7C638138776207361486%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=0JYigwvWVsbqlQ5ku6C5%2Flg1t3JOPTVRiXY2Us1Qk%2F0%3D&reserved=0
> 
> We also plan to hold another Open House meeting on the Charging
> Scheme in March to further discuss the charging scheme models. The
> Executive Board will then take the input and decide on one or more
> charging schemes for the membership to vote on at the GM to be held
> on 24 May 2023. The outcome of that vote will determine the charging
> scheme model to be used in the coming years.
> 
> I ask that you provide your input on this important consultation on
> the Membership Discussion mailing list (members-discuss at ripe.net) by
> 26 April. Input provided up to this date will be considered by the
> Board when formulating the charging schemes to be proposed for the
> GM. Input after this date is of course also welcome although it might
> not be reflected in the schemes put forward to the membership at the
> GM.
> 
> The consultation will also be recorded and available from:
> https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.ripe.net%2Fparticipate%2Fmail%2Fmember-and-community-consultations&data=05%7C01%7C%7C46ec650a5e4f496b170408db1fd5fed9%7Cd0b71c570f9b4acc923b81d0b26b55b3%7C0%7C0%7C638138776207361486%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=kHWP0r57yAgr%2F9wjZOka8eitURyEO6SsDRibg7MtmEI%3D&reserved=0
> 
> I look forward to your input.
> 
> Kind regards,
> 
> Simon Jan Haytink
> Finance Director
> RIPE NCC
> 
> Summary
> 
> 7 March: Start consultation with membership on RIPE NCC Charging
> Scheme model
> 21 March: Open House to discuss charging scheme with membership
> 24 March: Executive Board meeting to discuss input received so far
> 12 April: Publication of Draft RIPE NCC Charging Schemes 2024
> 26 April: Publication of Final RIPE NCC Charging Schemes to be voted
> on by members
> 24 May: RIPE NCC General Meeting May 2023
> 
> References
> 
> Open House and Survey Results
> https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.ripe.net%2Fparticipate%2Fmeetings%2Fopen-house%2Fripe-ncc-open-house-charging-scheme-principles&data=05%7C01%7C%7C46ec650a5e4f496b170408db1fd5fed9%7Cd0b71c570f9b4acc923b81d0b26b55b3%7C0%7C0%7C638138776207361486%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=W2KAXtFqgk86pDTD3qxqMlbQ2YRC02tRrJqXUc6G%2B%2Bs%3D&reserved=0
> 
> Presentation at General Meeting
> https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.ripe.net%2Fparticipate%2Fmeetings%2Fgm%2Fmeetings%2Fmay-2021%2Fdocumentation-and-archive%2Fripe-ncc-charging-scheme-discussion.pdf&data=05%7C01%7C%7C46ec650a5e4f496b170408db1fd5fed9%7Cd0b71c570f9b4acc923b81d0b26b55b3%7C0%7C0%7C638138776207361486%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=uPquLGxAfEuSsQZgWqS37a3Hd22jcGksQpzaB8pvrkU%3D&reserved=0
> 
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