North American Network Operators Group

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Re: IPV4 as a Commodity for Profit

  • From: Tom Vest
  • Date: Sat Feb 23 17:27:58 2008

On Feb 23, 2008, at 1:54 PM, Stephen Sprunk wrote:

Thus spake "Tom Vest" <[email protected]>
I agree, to a point. My prediction is that when the handful of
mega-ISPs are unable to get the massive quantities of IPv4 addresses
they need (a few dozen account for 90% of all
consumption in the ARIN region)...

I keep reading assertions like this. Is there any public, authoritative
evidence to support this claim?

Rechecking my own post to PPML, 73 Xtra Large orgs held 79.28% of ARIN's address space as of May 07; my apology for a faulty memory, but it's not off by enough to invalidate the point.

The statistics came from ARIN Member Services in response to an email
inquiry. I don't believe they publish such things anywhere (other than what's in WHOIS), but you can verify yourself if you wish; they were quite willing to
give me any stats I asked for if they had the necessary data available.

Thanks for the information Stephen.
In order to be perfectly clear on how to interpret this, it would be good to know whether this sum includes the pre-ARIN delegations, or just reflects what has happened since ARIN was established.

Then, if the distribution is deemed to be of real significance, e.g., to understand the past, or better understand what to do next, the best/simplest metric for such evaluations is probably the Herfindahl- Hirschman Index (HHI), which attempts to capture both dimensions of concentration/diffusion in a single unidimensional scale. This is probably the most common tool that economists and policymakers use to evaluate such things when necessary (e.g., before approving very large mergers) in other sectors.

The standard interpretations for HHI results may not be ideal for this sector, but if one has access to time series data, it does provide a really nice way of evaluating concentration/diffusion trends over time. To my mind, concerns about the distribution of PA are pretty analogous to concerns about the distribution of access to goods in general, while PA+PI together could be interpreted as the distribution of final goods themselves (e.g., think airports or airlines vs. individual passenger-flights). Since we're not talking about goods that are strongly bound to geography, the fact that ARIN members don't all "compete" for the same kinds of customers or over the same market territories doesn't really matter, as it would in more conventional contexts.

More on HHI here:

Bottom line: if people believe that the kind of de facto concentration/diffusion claims that have been circulating are important, a bit more effort should probably be devoted to understanding how to sensibly interpret such things.


If there is, is this 90% figure a new development, or rather the product
of changes in ownership (e.g., MCI-VZ-UU, SBC-ATT, etc.), changes in
behavior (a run on the bank), some combination of the two, or something
else altogether?

Most of the orgs in the Xtra Large class were already there before the
mega-mergers started; after all, you only need >/14 to be Xtra Large. Given
how most tend to operate in silos, they might still be separate orgs as far
as ARIN is concerned...


Stephen Sprunk         "God does not play dice."  --Albert Einstein
CCIE #3723         "God is an inveterate gambler, and He throws the
K5SSS        dice at every possible opportunity." --Stephen Hawking