200 Million New IPv4 Addresses to Enter Market: What to Expect? : Heficed

At the end of 2019, the US government passed a new bill authorising the Department of Defence to sell around 200 million Internet Protocol 4th version addresses. Several blocks of IPv4 addresses are planned to be sold out in ten years. Vincentas Grinius, CEO of Heficed, explains how these changes might affect the IP address market

[news release] The US Department of Defence announced the sale of around 200 million IPv4 addresses in multiple large and medium blocks. According to Vincentas Grinius, CEO of Heficed – the IP address infrastructure service provider, the new addresses would decrease the current IPv4 pricing, but would not solve the IPv4 shortage for certain market players. 

How would this Department of Defence sale
affect the IP address market in the upcoming years?

Potential Buyers – Do Small Companies
Stand a Chance?

New release of IPv4 addresses will be sold in
big and medium-sized blocks, and since the Department of Defence has a
deadline, they are focusing on large buyers. Large companies such as Amazon,
Microsoft, or Google are always looking to grow their IP address databases,
which would make them potential buyers.

“The biggest incumbents in the market are
always looking to buy more IP addresses. As the number of IPv4 addresses is
facing depletion, and we are slowly transitioning to IPv6, corporations are
more eager to collect as many IPv4s as possible. At the same time, released
addresses are contained in large bulks, which doesn’t give many chances for
smaller buyers and brokers to obtain their fair share. Therefore, I believe
that we will end up with a few major corporations acquiring everything.” –
Vincentas Grinius expressed his concerns.

Do
More Addresses Mean Lower Prices?

With new releases entering the market,
companies are promised to see lower IPv4 prices. However, if only a few major
buyers acquire it, the market might not face significant price changes.

“Due to IPv4 address exhaustion, prices have
been rising for a while now. As the average price in 2015 was around 6 dollars, in 2018, the price
for a single IPv4 address reached 17 dollars, and it’s predicted that this
number will only grow and double in upcoming years. It’s possible that the
Department of Defence bill could bring positive changes and lower IPv4 prices,
yet if these addresses are shared only among a few big corporations, we
probably wouldn’t even notice it.” – said Vincentas Grinius.

Risks
of IP Address Abuse

Many IP addresses are linked to spamming,
hacking, and similar vicious activities. Companies create blacklists to contain
abuse, but the more addresses enter the internet, the more difficult it gets.
Vincentas Grinius believes that potential buyers – large corporations could
help solve the issue, “Although every address holder can abuse their usage
rights, it becomes more challenging to control it with the surge of new
addresses. However, if only large and well-known corporations obtain new IPv4
addresses, the chances of IP address abuse can be monitored easier.”

New IPv4 release might shake up the market. However, it possesses both positive and negative outcomes. New IPv4 addresses postpone the transition to IPv6 and give us more time to prepare. Yet with more affordable and accessible options, the chances of IP address abuse might increase. And if large incumbents acquire most of the blocks, we might not see significant changes.

ABOUT HEFICED

With its headquarters in London and server locations in every continent,
Heficed is a network engineering and infrastructure service offering IP Address
Market platform, including cloud solutions and bare-metal servers. At the core
of Heficed‘s business is its world‘s first automated IPv4 address
infrastructure engineering platform, which streamlines the process of leasing
and managing IP addresses. www.heficed.com

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