Edelman, Benjamin. “Running Out of Numbers: Scarcity of IP Addresses and What To Do About It.” Auctions, Market Mechanisms and Their Applications 14 (2009): 95-106. (Springer-Verlag Lecture Notes of the Institute for Computer Science.) (Featured in Working Knowledge: When the Internet Runs Out of IP Addresses) (Circulated in 2008 as Running Out of Numbers? The Impending Scarcity of IP Addresses and What To Do About It.)
The Internet’s current numbering system is nearing exhaustion: Existing protocols allow only a finite set of computer numbers (“IP addresses”), and central authorities will soon deplete their supply. I evaluate a series of possible responses to this shortage: Sharing addresses impedes new Internet applications and does not seem to be scalable. A new numbering system (“IPv6”) offers greater capacity, but network incentives impede transition. Paid transfers of IP addresses would better allocate resources to those who need them most, but unrestricted transfers might threaten the Internet’s routing system. I suggest policies to create an IP address “market” while avoiding major negative externalities–mitigating the worst effects of v4 scarcity, while obtaining price discovery and allocative efficiency benefits of market transactions.
Disclosure: I provide advice to ARIN’s counsel on matters pertaining to v6 transition, v4 exhaustion, and possible revisions to ARIN’s v4 transfer policy. But this paper expresses only my own views – not the views of ARIN, its Board, or its staff. I write on my own behalf, not for ARIN, nor at ARIN’s instruction or request.