PROPOSAL #2 - reform of the fee schedule (fwd)

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1

I am expanding the discussion list to NANOG and the ARIN Members mailing
lists. Please post comments PUBLICALLY, or if you feel you cannot do so
without "cloaking" yourself, through someone else (who you trust to strip
the attribution).

Towards a more fair fee proposal:

I would like to ask the AC to direct Kim Hubbard to produce a list of the
number of allocations in each of the fee categories currently listed, along
with the documentation required to process each.

From this I believe we will find:

1) *TO BE FAIR*, one must document all allocations and use in all
  existing space at least bi-annually (once every two years) when
  coming back for more space.

2) A smaller allocation history naturally has less to produce.

Therefore, I argue that the fees should be *proportionate* to the existing
space.

The smallest allocation, a /19, is 8192 addresses.

Let's say that we set the "desired entry price" at $2,000.

Therefore, the "cost per address allocated, including the current request",
is set at, say, $0.25.

Now Mr. Big Provider comes in and wants space. They have, let's say, the
equivalent of an /8.

They pay ~$4M under this formula.

Obviously, we have just set the cost too high.

Ok.

ARIN has an operating budget of $2M.

So we cut the base cost by 90%.

Therefore, the /19 requestor pays $200 (!), or 0.025 cents per address IN
USE, including the NEW requested allocation.

Mr. Big Provider pays ~$400,000

Annually.

The first allocation you request in a calendar year, you get assessed for
ALL space you have, including the request you put in for. So if you have a
/16, and ask for another /16, you get assessed for 65536 * 2, or 128k
addresses.

This works out to a fee of $3276.80.

Note that if you ask for less, the fee is lower. There's your resistor
on people asking for more than they need - it costs money (regardless of
whether or not you get approved!)

This is *FAIR*. We're now charging for the amount of verification work to
be performed and EVERY allocation is treated equally.

Now the reality is that this will put us WAY over budget. This is GOOD.
What we need to do then is cut the base membership fee to something that
ordinary people can afford - $50/year.

The stakeholders should have a say in this, and the stakeholders, folks, are
the average users.

Would someone please tell me why this isn't a more proper fee strategy?

2

I would like to ask the AC to direct Kim Hubbard to produce a list of the
number of allocations in each of the fee categories currently listed, along
with the documentation required to process each.

I'd love to see all these documents but currently the ARIN folks sign NDAs
and won't let anyone see this stuff, not AC members or BoT members. Before
I deal with this I'd like to get an idea from the members how many of you
would sue me personally if I voted for a proposal to order ARIN employees
to break the NDAs that they signed with your company.

Would someone please tell me why this isn't a more proper fee strategy?

Because it is based entirely on hypothesis with no hard data to back it
up. The first step is to get the data, second step is to analyze it and
only after the analysis is done can we effectively design a revised
funding scheme for IANA.

I suggest we focus on how to accomplish the first two steps and if too
much of the data is covered by NDAs then I suggest we hire another
ARIN employee with statistical training to go through the data and analyze
it on our behalf while ensuring that confidential member data is not
accidentally outed.

3

An NDA cannot cover publically available information Michael (and to the
extent it does, its unenforceable).

Please cut the strawmen; I have already explained this in detail twice (and
in fact the proposal does so).

The fact that a business plan was requested is not confidential. That a
business plan was produced isn't either (neither rises to the level of a
trade secret, nor can it). The CONTENTS of the document may be confidential.

It is not necessay to produce the CONTENTS to show the documentary trail.

This is the second time you've raised this strawman, and its just as invalid
this time as it was the last.

4

Therefore, I argue that the fees should be *proportionate* to the existing
space.

A good idea.

While working fulltime for NACS.NET (I don't any longer), a few months
ago, I checked out ARIN's site to find out how much a /19 would be, because
NACS is going to need some more IP's soon.

The price was, ahhhh, shall we say, a little high :slight_smile:

This is *FAIR*. We're now charging for the amount of verification work to
be performed and EVERY allocation is treated equally.

Now the reality is that this will put us WAY over budget. This is GOOD.
What we need to do then is cut the base membership fee to something that
ordinary people can afford - $50/year.

Um, yeah.

The stakeholders should have a say in this, and the stakeholders, folks, are
the average users.

Um, yeah. :slight_smile:

Would someone please tell me why this isn't a more proper fee strategy?

[wisecracks withheld] :wink:

Karl, I think that makes a lot more sense than the justification I got
over the phone from one of the people at ARIN... "we're not government-
subsidized any more" -- which may be TRUE, but it's not justification for
the fees they're asking for.

5

Would someone please tell me why this isn't a more proper fee strategy?

--
--
Karl Denninger (karl@MCS.Net)| MCSNet - Serving Chicagoland and Wisconsin

It makes perfect sense, Karl. I would like to see the numbers reported by
Kim first, however. It might make sense to bump the entry level fee
somewhat with some sort of a "First Time Buyers" fee that includes ARIN
membership - that way anyone who acutally has to pay part or any of the
funding of ARIN would have the ability to participate in its governance.