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[ISN] The Impending Internet Address Shortage
By Thomas Claburn
May 21, 2007
The coming shortage of Internet Protocol addresses on Monday prompted
the American Registry for Internet Numbers (ARIN) to call for a faster
migration to the new Internet Protocol, IPv6.
The current version of the Internet Protocol, IPv4, allows for over 4
billion (2^32) Internet addresses. Only 19% of the IPv4 address space
remains. Somewhere around 2012-2013, the last Internet address bloc will
be assigned and the Internet will be full, in a manner of speaking.
"We must prepare for IPv4's depletion, and ARIN's resolution to
encourage that migration to IPv6 may be the impetus for more
organizations to start the planning process," said John Curran, chairman
of ARIN's Board of Trustees, in a statement.
IPv6 promises some 16 billion-billion possible addresses (2^128).
IP numbers are used to route traffic around the Internet. They're not
the same thing as Internet domain names, which get mapped to IP numbers
through the Domain Name System (DNS) because it's much easier to
remember "Amazon.com" than "188.8.131.52."
"Unless action is taken now, a quiet technical crisis will occur, not
unlike Y2K in its complications, but without a fixed date or high level
public attention," wrote Stephen M. Ryan, a partner at McDermott Will &
Emery LLP and ARIN general counsel, and Raymond A. Plzak, CEO and
president of ARIN, in a forthcoming policy paper.
Ryan and Plzak foresee potential legal problems arising as address
scarcity leads to a new black market in IP numbers.
IP numbers are not, like Internet domain names, seen as property by U.S.
courts as a consequence of Gary Kremen's litigation to recover the
Sex.com domain. In the course of that dispute, Kremen in 2001 was
awarded the assets of an ISP that defendant Stephen Cohen had acquired,
which included IP numbers.
Kremen then engaged in litigation with ARIN to obtain his IP numbers
without signing the ARIN registration service agreement. In essence, he
claimed ownership rights in the IP numbers rather than the more limited
set of rights governed by ARIN's contract. The U.S. District Court in
San Jose, Calif. rejected Kremen's claim last year, upholding ARIN's
regulatory power over IP numbers.
But a number of companies, organizations, and individuals hold IP
numbers that predate ARIN's arrival on the scene in 1997. Holders of IP
address blocs awarded during the Internet's early days may be sitting on
a gold mine. Because they're not bound by an ARIN contract, they're
theoretically free to sell their IP numbers. They haven't done so
because, among other things, there's no money in it at the moment. But
if the IPv6 migration continues to lag and IP addresses become scarce,
holders of legacy IP address blocs could find it profitable to sell
"The characteristics of such a market are yet to form," said Ryan and
Plzak in their paper, Legal and Policy Aspects of Internet Number
Resources. "It could, for example, result in delivering 'windfall'
profits to those who early on obtained legacy address blocs. Corporate
assets will instantly be more valuable if they have such blocs as
Karl Auerbach, former member of the board of directors of ICANN, former
Cisco researcher, CTO of InterWorking Labs, and an attorney, happens to
be someone who obtained a legacy IP bloc back when Professor Jon Postel
ran the Internet.
"I've had people who want to acquire my spaces, some for some pretty
hefty amounts," Auerbach said in an e-mail, noting than the legal status
of IP numbers remains muddy. "Those deals fell through due to
uncertainty about whether routing ISPs would honor the deal and accept
routing announcements. Without the cooperation of the ISPs, an attempt
to transfer space can be futile."
Auerbach said he has loaned IP address numbers to friends on a
short-term basis. "But that kind of thing is from the spirit of the
Internet of the '70s and '80s but certainly not the commercialized Net
of today," he explained. "But don't 'cha think that in many ways the old
ways are a nice residual from a more halcyon and more cooperative era?"
As for making a legitimate market for IP address space, Auerbach
supports the idea. He also agrees that IPv6 transition won't be easy.
One controversial method for dealing with the IP address shortage has
been the increasing use of Network Address Translation (NAT), which
effectively creates a private network within a given IP address.
"The issue of NATs has been under appreciated -- they are awful things
that cause great trouble," Auerbach said. "But we've learned to live
with 'em and new protocols are even being designed in anticipation of
NATs. So perhaps the Net of the future might evolve as an IPv4 public
mesh connecting private spaces behind NATs. For that we have enough IPv4
space for decades. That scenario runs into trouble when those private
spaces try to directly interconnect. But, like Scarlett O'Hara, most of
us will think about that tomorrow."
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