It’s one of those things you read and say, this can’t possibly be true.
The Web is going to run out of IP addresses in two or three years? Come on.
But in fact, it is true, and Internet experts have raised the issue for years. (Even USA Today wrote on the subject in 2007). It just hasn’t floated up to the public consciousness.
But this should be of concern to you because some experts argue this event will drive up Internet access prices, or dampen the growth of Web-based products and services. And it really hammers you if you want to get in the ISP or Web hosting businesses in the future.
Basic background: IP addresses, which are used to connect computers and other devices to the Net, are currently determined by a standard known as IPv4, which allows up to about 4 billion possible number combinations to be allocated by Web governing bodies. But time is running out; the 4 billion are almost gone. A replacement standard, IPv6, would provide trillions of additional addresses — but technical, practical and monetary issues have delayed its widespread acceptance, probably for many years.
The Fix
What to do? Harvard Business School professor Ben Edelman and others propose creating a market in which already owned but unused IP addresses could be swapped or sold. Turns out there are many potential locations that could be recirculated, he tells me in an interview for HBS Working Knowledge.
There are other short-term fixes, says Edelman, but he prefers a market approach.
“A market-based approach offers a real benefit to those who still need more IPv4 addresses after ordinary supplies run out. Rather than being told that no more IPv4 space is available, on any terms or at any price, these networks could offer payments to get v4 space from others. It’s unlikely that other networks would return their space for free—why would they? But if the price is right, they may be willing to transfer the space to someone who needs it more.
“So the core benefit is allocative efficiency, moving scarce resources to those who need them most.”
Of course, the networks are not likely to eat the costs they encounter buying up unused IP space. At some point, these expenses are likely to filter down in the form of increased IP address fees (they are minimal today) and possibly even flow further down the food chain towards us users, some experts warn.
What with collapsing personal wealth, possible job loss and the global economic meltdown, the coming dry up of Web addresses probably isn’t keeping you awake at night. But count on reading more about this over the coming year.
Oh, and if you want another Web worry, check out this story on why the Internet’s routing tables, really the master directory of network destinations, might collapse under strain from growing use of the Internet.
Good times.
