IPv4 sales are "not cut and dried. The Nortel/Microsoft deal was the beginning of a process by which we will work this out," says Professor Milton Mueller of the School of Information Studies at Syracuse University and a committee member of the Internet Governance Project.
Mueller adds that ARIN's "part in the Nortel/Microsoft deal was an improvisation, and it deviated from what they expected to happen ... ARIN learned about this deal just the same way that you and I did ... and then they scrambled to the bankruptcy court. Suddenly the sale agreement was amended and had all this stuff about ARIN in it."
Marc Lindsey, a partner with Washington, D.C., law firm Levine, Blaszak, Block & Boothby, says the issue of whether legacy IPv4 address holders like Nortel own "intangible property rights" hasn't been decided by the courts. But he adds that the Nortel bankruptcy judge's ruling "declaring that Nortel possessed the exclusive right to use and transfer its legacy numbers comes pretty close."
The issue of intangible property rights "is an interesting legal question and as a practical matter in the marketplace will have a big impact on value" of IPv4 address blocks, Lindsey says.
Legacy address holders -- including IBM, General Electric, Xerox and MIT -- received large blocks of IPv4 address space, some as big as 16.7 million addresses, before ARIN was founded. Most legacy address space holders are U.S. companies, universities and government agencies.
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The majority of legacy address holders have not signed Legacy Registration Services Agreements (LRSAs) with ARIN, despite pressure from ARIN over the past few years for them to do so. LRSAs are less stringent than the typical contracts network operators sign with ARIN, which are called RSAs for Registration Services Agreements.
John Curran, president and CEO of ARIN, says more than 500 legacy IPv4 address holders have signed LRSAs with ARIN, but that an estimated 10,000 to 20,000 have not.
Lindsey says legacy IPv4 address holders haven't signed LRSAs because "there is not a value proposition for them."
Mueller points out that Nortel's sale of IPv4 addresses to Microsoft did not follow ARIN's stated policies about how IPv4 trades are supposed to occur, starting with the fact that Nortel hadn't signed an LRSA.