Friday, June 10, 2011

Peek IPv4 ?

In its announcement about "IPv6 Day", the Internet Society (ISOC) casually remarked that IPv4 addresses are about to run out:
With IPv4 addresses running out this year, the industry must act quickly to accelerate full IPv6 adoption or risk increased costs and limited functionality online for Internet users everywhere.

This is highly misleading, and the recommended solution is not a good idea. I am sure if pressed the ISOC would respond that by "running out", they mean in the technical sense that some registrar or another has now given away all its addresses. However, the actual verbiage implies something far different. It implies that if you or I try to get an IPv4 address on January 1, 2012, we won't be able to do so. That implication is highly unlikely.

A better way to think about the issue is via price theory. From the price theory point of view, the number of IPv4 addresses at any time is finite, and each address has a specific owner. At the current time, every valid address is owned by some entity or another. (Thus, in some sense they "ran out" a long time ago.)

When a new person wants to get an IPv4 address for their own use, they must obtain the rights from some entity that already has one. While some large organizations can use political mechanisms to gain an IPv4 address, most people must purchase or rent the address from some entity that already owns one. Typically those IP addresses are bundled with a service contract that provides Internet bandwidth, though in some cases addresses can be purchased by themselves.

The price one pays gives us a way to think about the scarcity of addresses. Diamonds are relatively scarce, and their price is correspondingly high. Being 747s are even more scarce, and their price is even higher. For IP addresses, the price is surely rising over time as more and more people hook things up to the Internet. Already the price is high enough that, for example, most home users do not assign a separate publicly routable address to every IP device in their home. They make do with a single IP address from their Internet provider.

What is that price right now? The question is crudely phrased, because some addresses are more valuable than others, and all addresses come with some sort of strings attached. However, we can get a ballpark idea by considering a few data points:
  • Linode offers its subscribers an extra IP address for $1/month.
  • Linode offers an IP address along with an Internet hosting service for under $20/month.
  • Broadband providers such as Comcast and AT&T offer an IP address along with Internet connectivity for on the order of $50/month.
From these observations we can infer that the cost of an IP address is at most a few dollars per month. With the cost this low, I can't see any major site going to IPv6-only any time soon. A few dollars per month is a very low price to pay for a great deal of extra accessibility. With the protocols designed as they are right now, the reason to consider IPv6 is that it's a newer, better protocol, not because it has more available addresses.

I wish public communication about IPv6 would make this more clear. The Internet is important, and as such, it is important that the techies get it right. This isn't a minor technical detail.

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