Hey Buddy, Can You Spare an IPv4 Address?

Ok, it’s not that bad yet, but MicroSoft just spent money to acquire a pile of IP addresses from the remnants of the Nortel bankruptcy.  Now that ICANN is out of addresses to give out, it is only a matter of time before market forces determine just what one is worth.  MicroSoft paid $7.5M for 666,624 addresses, which means the first volley sets the value at $11.25 each.  But it was opportunistic, surely they didn’t need it?  Interestingly, if such a value becomes a liquidly tradeable item, then the total value of its market is known.  There are 4,294,967,296 IPv4 addresses, so at $11.25 each the entire supply would be worth $48.3B.  Hmmm, I wonder where you put that on a balance sheet.

Come to think of it though, just what the heck is MicroSoft up to?  I’d call it opportunism, but $7.5M is chicken feed for them and if they triple their money it’s still chicken feed.  It’d like seeing Warren Buffet trade penny stocks.  But they don’t need the address space as far as I know.  And they’re not really lagging in the journey to IPv6 race, they’ve done a lot of work with Windows 7 on that front.  What exactly do they need 666,624 IPv4 addresses for?  Nothing.

But perhaps what they want is simply what they got.  A lot of stories in the press setting a price for IPv4 addresses and warning of a developing market for them in which the price can only go up until there are no more.  It brings home the fact that they’re running out and attaches an actual dollar value to it.  So what do you do if you aren’t sure what your exposure is but don’t want to lose a game of digital musical chairs that suddenly isn’t free?  You upgrade.  You know, to software that is IPv6 friendly, like Windows 7.  Nah, they’re not that devious, are they?

If you haven't already, please take our Reader Survey! Just 3 questions to help us better understand who is reading Telecom Ramblings so we can serve you better!

Categories: Internet Traffic