Responses to IPv4 address space consumption

Paul Wilson, APNIC

[This article was originally published in Apster 23, September 2007]

Introduction

IP address space is the Internet's fundamental numbering resource: Every device that is directly connected to the Internet requires an IP address. Today IPv4, the addressing standard that has been in place for the past 20 years, dominates the Internet. The total number of IPv4 addresses is strictly limited to a total of around 4 billion addresses; therefore, while IPv4 is dominant the size of the public Internet is also similarly limited. Consumption of the remaining unallocated IPv4 address space is accelerating, and based on current consumption rates it is projected that the remaining 'free pool' of addresses could be exhausted by the year 2011 (as shown in Figure 1, from http://ipv4.potaroo.net).

IPv4 consumption The fact that the IPv4 address space will be fully consumed in due course has always been known, and measures to ensure the ongoing growth of the Internet have been planned for many years. The best known measure is IPv6, which provides a much larger address space, as well as other useful features. Until now, it seems that many of those who will be affected by the depletion of IPv4 addresses have been prepared to wait before taking action. However, as this critical period draws nearer, concerns are emerging about the readiness of the Internet to switch to IPv6 and about the consequences if it is not ready. At the same time, there is still great uncertainty about the timing and outcome of events, which themselves depend on how the Internet community responds to the situation. It is a classic 'Chicken and Egg' situation.

This article examines some possible responses to the current state of IPv4 address consumption, within the current IPv4 addressing environment. The aim of these responses would be a smooth transition from today's IPv4-dominated addressing system to an IPv6-dominated system, without risk to the essential attributes of the Internet. Specifically, we need to ensure that regardless of any change, the Internet remains functional, stable, coherent, and fully connected at all times.

Address policy environment

The management of Internet addresses is a matter of interest to many in the Internet community, particularly those involved in providing Internet services and infrastructure. Today a range of mechanisms exist that allow interested organisations and individuals to participate in the development of policies that govern the address management system. These mechanisms are provided by Regional Internet Registries (RIRs) and ICANN, and are generally well known within the Internet addressing and technical communities. Participants including Internet service providers, developers, users, researchers, governments, and members of society at large use them.

RIR policy process

Each RIR has a set of regional address management policies that govern its own regional processes for allocating and registering IP addresses. Each RIR also has well-defined mechanisms for developing (altering, extending or removing) those policies through Open Policy Meetings and associated activities and processes. Through these means, address management policies are continually developed and refined by the addressing community in direct response to emerging needs within the Internet itself.

It is worth noting that in each region the policy development process is itself defined by policy, which can be changed in the same open manner.

Global policy co-ordination

Among the five RIRs, there are currently nine annual Open Policy Meetings, which provide regular opportunities for collective consideration of policy issues and proposals. While these meetings serve to reflect regional priorities and objectives, they also provide an avenue for global cross-fertilisation of policy discussions and policy changes, which help to maintain a level of consistency between the regional addressing communities.

Global policy process

The Address Council (AC) of the Address Supporting Organization (ASO) is a global body whose formal responsibility is the coordination and oversight of global address policy initiatives. The Internet addressing community in each region appoints its members through an open election process.

According to a bottom-up process of policy development, global addressing policies must be approved by each regional addressing community before being passed to the AC for endorsement. Due to the need for support from every region the development of global policies can be slow, requiring more than one cycle of review and update within each region before consensus is reached.

Procedural responses to address consumption

RIRs are responsible for implementing policies as determined by their regional communities in the manner described above. In general, it is the address policies that determine address consumption rates and patterns, and RIR actions have little or no impact on those rates and patterns.

However, RIRs undertake a range of supporting activities, and may undertake administrative or service initiatives that respond to the current Internet environment. In this section we look at the RIRs responses, which may address some concerns about address consumption.

Global policy activities

The current processes for the development of global policies strongly support regional autonomy and bottom-up consensus decision-making. However, at a time when global policy initiatives may become quite critical, there may be opportunities to improve the efficiency of the global policy process without sacrificing its essential features.

For instance, the ASO Address Council could become more actively involved in inter-RIR exchange of information about regional policy developments, particularly about proposed global policies, or policies that have the potential to become global. The AC could also establish communication mechanisms, such as mailing lists, where global policy proposals could be raised and discussed at the earliest possible stage. This could certainly facilitate discussion and understanding of global policy proposals before they are formally introduced into each of the regional open policy meetings.

IANA request process

Currently there is a global policy governing the allocation of IPv4 address space from IANA to the RIRs, which specifies the size of those allocations. Under this policy it is possible for RIRs to receive allocations as large as five or more /8 blocks, equivalent to over 10% of the remaining IPv4 pool at this time. During 2007, the RIRs proposed and agreed to limit these allocations to a maximum of two /8 blocks at a time, regardless of entitlements under the policy.

While this measure will not have any net impact on the consumption of IPv4 addresses, it is intended to support a finer pattern of IPv4 allocation to each RIR, resulting in a distribution outcome that is more predictable and more equitable across the regions.

Administration of legacy address space

During 2007, the RIRs also undertook a joint analysis of the so-called 'legacy' address space, which was directly assigned by IANA prior to the establishment of the RIR system. Currently, there are 91 /8 IPv4 blocks classed as 'legacy' address space, representing some 35% of the total IPv4 address pool, and still significantly more than the total address space allocated to the RIRs themselves (81 blocks or 32% of the total).

The RIR analysis identified a collection of unallocated IPv4 addresses equivalent to approximately seven /8 address blocks in size. Based on this analysis, the RIRs then determined an equitable distribution of administrative responsibility for specific legacy /8 blocks to each of the RIRs, ensuring an equal share of that free address space for each RIR. This distribution was ratified with IANA in July 2007 and is being implemented at the time of writing.

Internet Resource Certification

IPv4 distribution With increasing interest in the efficient use of IPv4 address space, there is currently an increased focus on the importance of IPv4 registration information and on the role of RIRs as authoritative registries. At the same time, the security of registration information and the security and integrity of the Internet's routing system are also becoming critical issues.

The RIRs, along with the IETF community, are currently examining options for the digital certification of Internet resource information as a means of addressing these needs, and in some cases conducting technical development and trials. APNIC is particularly active in this area and will deploy certificate management services and tools to its members beginning early in 2008.

Policy responses to address consumption

Numerous policy initiatives have been proposed in the past that have implications for IPv4 address space consumption, and in the current environment, more proposals can be expected in future. In this section, some past and current proposals are reviewed. However, there is no suggestion that any measure should be implemented without full reference to the RIR and/or ASO policy processes.

IPv6 considerations

Today, IPv6 standards are in a mature state, IPv6 products are available for many platforms and IPv6 connectivity is supported by many applications. IPv6 address space is actively being allocated, and some production IPv6 networks are being deployed. However, the current rate of this development is still not high enough for a smooth transition to IPv6 within the next two or three years.

The reasons for the lack of widespread IPv6 deployment in the public Internet to date have been debated widely in recent times, and they appear to be largely commercial rather than technical. It is clear that despite strong promotion efforts, IPv6 is yet to produce a business case for rapid deployment by a significant number of ISPs. However, as rates of deployment accelerate it is now becoming critical to enable a smooth transition when needed. Without sufficient time for this transition, it is likely that new Internet infrastructure will be delayed, and existing infrastructure may possibly be disrupted during a rushed and compromised transition process.

While IPv6 address policies will be revisited and may be revised at any time in the future, it seems that no one is suggesting that substantial IPv6 address policy changes are needed at this time. On the contrary, RIR communities have taken every measure available to ensure that there are no policy impediments to IPv6 address space availability for any viable application. However, all RIRs have become actively involved in recent years in the promotion of IPv6 within their communities, particularly in operator community education and training, and in government circles.

Address space reclamation

Of the IPv4 addresses that have ever been allocated, approximately 25% (or around 48 /8 blocks) do not appear in the routing system of the public Internet. This unrouted address space is certainly not used in the public Internet, and it is not known how much is in use in private networks, or how much is completely unused. In either case, the addresses could possibly be 'reclaimed' for use on the public network.

It has often been suggested that unused address space should be reclaimed for reuse. However, the lack of conditions on early allocations can make this process very difficult. Particularly in the USA, where most legacy allocations exist, reclamation processes are not only likely to be lengthy and difficult, but also legally expensive. At this time, only APNIC and LACNIC have active reclamation processes in place while in other regions address space returns are effectively voluntary. In either case, the amount of address space that can be recovered is relatively insignificant.

Private use address space: 240/4

Given the interest in large-scale, NGN-type projects, it seems that new network deployments on the drawing board are essentially private networks, but are too large to use existing private-use (RFC 1918) address space. Proposals have previously been made for allocation of additional IPv4 address blocks for private use, but these did not achieve consensus across the addressing communities. Without additional private space being made available, it is possible that such network deployments might consume large amounts of IPv4 addresses in future, contributing unnecessarily to address space depletion.

Another possibility under discussion is the redesignation of some or all the existing reserved '240/4' address space (comprising 16 /8 blocks of IPv4 address space) for this purpose. This space is still unused, and there are no other proposals for its use. It is also generally regarded as unsuitable for public unicast use as 'normal' Internet address space due to the need to upgrade many different devices across the Internet (similar to the challenge of transitioning to IPv6). However, within a private network setting, an operator would be able to assess, manage, and control the upgrade process according to their needs based on a full knowledge of the infrastructure in use and the costs and benefits of that upgrade.

IPv4 'flag date'

A recent policy proposal has suggested that a specific date should be established on which all RIRs will cease to make IPv4 address allocations, and that remaining addresses at that time should be reserved for future critical purposes. In addition, it is proposed that once the date is established, no further changes to address policy should be made in order to 'ensure steady provision of IPv4 address space.' The intention is to provide some certainty as to when alternative arrangements (namely IPv6) must be in place, and to avoid perceptions of unfairness between or within RIR regions.

To date, this proposal has not achieved consensus in any RIR region. It appears that communities are unwilling to voluntarily impose constraints on possible future action, as would be implied by the choice of a flag date and the prevention of future policy changes.

Allocation of remaining IPv4 address pool

Another recent global proposal has suggested that when the IANA IPv4 pool is reduced to a certain level (for instance to 20 or 15 /8 blocks), that the remaining address space should be divided equally among the five RIRs. The purpose of this proposal is to allow each individual RIR to autonomously determine its own chosen approach to the distribution of those blocks, and also to avoid a 'late run' on the central IANA pool, which would possibly favour some regions over others. The proposal was approved in the LACNIC region, and will be discussed in other regions during 2007.

Address space transfer and trade

It has been suggested that the immediate outcome of the exhaustion of the unallocated IPv4 address pools would be the emergence of a market for IPv4 address space in which addresses themselves, or licences for 'right-of-use' of address space, could be traded. Such a trading scenario could assume one of many possible forms, and could have a range of possible effects, both positive and negative.

The sudden emergence of a market for IP addresses, particularly after the consumption of existing IPv4 supplies, could create a significant disruption in the distribution of IP addresses and the integrity of the Internet itself. Possible risks include the escalation of prices for IP address space beyond the reach of many address users, the fragmentation of address blocks resulting in routing problems, illegal trading and fraudulent claims on address space, market distortions (such as hoarding, price speculation and attempts at seizure of control), the emergence of conflicting markets, and an Internet without a single authoritative system for address registration. On the other hand, it is also conceivable that a trading market could emerge in an orderly fashion: one that has the support of the Internet addressing community, in which the RIRs continue to play their crucial roles as registries of current address space holdings and of address 'right-of-use' licence transfers.

The implications of such a scenario deserve a more thorough and extended analysis than is possible here; however, the following observations may be made:

IP address transfers are already undertaken by RIRs on a regular basis, with mergers and acquisitions of network providers or infrastructure.
Today's address transfer policies could be relaxed to allow transfers to be recognised in a market environment, probably without major cost or administrative changes.
Digital resource certificates, currently under consideration for use in routing security, may be adapted to represent address right-of-use 'licences' for use in transfer or trade.
If transfer policies are adjusted before the exhaustion of IP address space, then address space users would have a choice in the source of addresses (but not in the choice of address registry).
Existing address allocation services provided by the RIRs, along with fees charged for those services, would tend to moderate the market and impose a limit on price escalation.
While address stockpiling would be possible, today's RIR policies of allocation only for demonstrated need would tend to prevent RIR allocations from being stockpiled.
The speculative value of IPv4 addresses would likely be severely limited by the inevitable advent of IPv6 addressing, while any form of severe price escalation in an IPv4 market would only add further impetus to IPv6 deployment.
A market for address space would provide strong incentives for unused IPv4 address space to be brought 'into circulation', and would relieve pressure on the remaining IANA address pool.
The advent of a market of some kind may be inevitable after the exhaustion of the remaining address pool. If so, the structuring of such a market to avoid industry disruption and market distortion would be a critical role for RIRs.

Conclusion

This article has explored some current initiatives that may affect the management and consumption of the remaining IPv4 address space. Some of these are operational initiatives that can be easily implemented, while others involve deeper changes at the policy level that will certainly need further discussion by the Internet addressing community. The recent acceleration of IPv4 address space consumption, along with the ongoing slow (up take) of IPv6, add some extra urgency to these discussions and should be a cause for concern for everyone in this community.

Given the importance of addressing to the Internet and its development, it is no surprise that these issues are finding a much larger community of interest these days, or that they have been placed on the agenda of the Internet Governance Forum meeting that will be held later in 2007. It is the responsibility of all of us to become acquainted with and involved in these discussions, and to find workable solutions within the fairly near future.