Toshi,

Thanks for this submission. Hope we can have a good disucussion and result on this proposal.

Regards, Akinori, Chair of NIR-SIG

In message 20040804145732.75AA.HOSAKA@nic.ad.jp "NIR SIG Proposal at APNIC-18 - Changing NIR fee structure" "Toshiyuki Hosaka hosaka@nic.ad.jp" wrote:

| Dear Maemura-san and all NIR colleagues, | | The following is another proposal from JPNIC, which I have submitted by | email today. Your questions, comments, and suggenstions are highly | appreciated. | | Looking forward to seeing you all in Fiji. | | Thanks and best regards, | Toshi@JPNIC | | ---------------- | | Proposal: Changing NIR fee structure | Author: Toshiyuki Hosaka, Japan Network Information Center (JPNIC) | Version 1.0 as of August 4, 2004 | | _____________________________________________________________________ | Introduction: | (A very brief description of your proposal.) | --------------------------------------------------------------------- | | This document proposes new NIR fee structure, which could be acceptable | for all stakeholders, i.e., APNIC, APNIC members, and NIRs. This | proposed fee structure sets an per allocation fee charged to NIRs | (indirectly to NIR members) at a reasonable level even when NIRs make | a large allocation to their members, by setting an upper limit to the | fee. | | | _____________________________________________________________________ | Summary of the current problem: | (Describe the situation that this proposal is intended to address.) | --------------------------------------------------------------------- | | NIRs are charged NIR fees, or per address fee, defined in APNIC-103 | (Operational policies for National Internet Registries in the APNIC | region), in addition to yearly membership fee, which all APNIC members | pay as well. | | 1.3 NIR fees | ---------------- | | APNIC charges fees for providing NIR services. These fees are set at | a level that ensures that other APNIC members do not subsidise NIR | members and that NIRs provide sufficient funding to cover the cost of | providing the services they require. Details of the NIR fees are | described in the APNIC document "APNIC Fee Schedule: Membership | Tiers, Fees, and Descriptions", within the provisions describing the | 'per address fee' for confederations. | | | This NIR fees increase in proportion to the address space allocated to | NIRs (or NIR members), and there is no upper limit in the fee. This is | the problem for NIRs/NIR members especially in large allocation. | | For exapmle; | | /10 in IPv4 : 4,194,304 * USD 0.02 (Extra Large) = USD 83,886.08 | /20 in IPv6 : 5,534,417 * USD 0.02 (ditto) = USD 110,688.34 | | Such large allocations are feasible for JPNIC members. Our IPv4 address | allocation size to our members shows a trend of increase. JPNIC has made | 5 allocations exceeding /14 in recent 12 months, from July 2003 to June | 2004, for instance. | | Furthermore, revised IPv6 policy document (prop-016-v002) clarifies | that LIRs can apply for larger IPv6 allocations based on the current | IPv4 infrastructure, and that the allocation size is decided in | accordance with the HD-ratio. So it is very likely for our members to | request larger IPv6 allocations. In fact, JPNIC had inquiries recently | from two of our members regarding large IPv6 allocation at /20 level. | | This is actually a huge amount of fee, larger than yearly APNIC/JPNIC | membership fee. JPNIC has to pass such cost to our members in either | ways as below; | | a) JPNIC passes this cost on our members | b) JPNIC passee this cost on the requestor | | Choice a) is not acceptable for JPNIC because this means small/medium | ISPs are to pay larger ISP's per allocation fee. | | Choice b) also has problems as below; | | 1) NIR members may lose the motivation to request large allocations | under NIR membership, since the expense is far larger than receiving | allocations directly from APNIC. This is not the situation we want. | | 2) This large per address fee is beyond the level that NIRs can | justify as "value added service", such as local language/whois/ | information/translation. | | 3) This large per address fee is beyond the intention described in | APNIC-103. | | 4) In order to avoid a per allocation fee, NIR members *may* receive | the large amount of IP resources as an APNIC member and after that | it *may* transfer its membership to NIR. This causes much burden | both APNIC and NIRs. | | 5) If Large NIR members flow out to APNIC direct membership, APNIC's | opration cost could increase which might be transfered to membership | fee applied to all APNIC members in the long run. | | _____________________________________________________________________ | Situation in other RIRs: | (If applicable, describe any policies which may apply to this | situation in ARIN,LACNIC, or RIPE NCC. If you are not sure, leave | this section blank.) | --------------------------------------------------------------------- | | (blank) | | | _____________________________________________________________________ | Details of your proposal: | (Describe your proposal in detail.) | --------------------------------------------------------------------- | | JPNIC proposes to "set an upper limit on the per address fee for NIRs". | Non-NIR confederations is not the target of this proposal. | | This proposal consists of two parts. Details are as follows; | | | (1) JPNIC proposes to set an upper limit on the per address fee | for a single allocation, provided that the NIRs make an | allocation from APNIC common address pool (including Direct | Member Allocation). | | (2) JPNIC tentatively proposes that the upper limit of per address | fee for a single allocation should be set at /14 in IPv4, and | /28 in IPv6. However, this specific value is subject to a | financial impact assessment by APNIC. | | | Proposed per address fee is calculated as follows; | | (IPv4) | /20 : 4,096 * (per address fee) | /19 : 8,192 * (per address fee) | /18 : 16,384 * (per address fee) | /17 : 32,768 * (per address fee) | /16 : 65,536 * (per address fee) | /15 : 131,072 * (per address fee) | /14 : 262,144 * (per address fee) | /13 : 262,144 * (per address fee) | /12 : 262,144 * (per address fee) | ... ... | | | (IPv6) | /32 : 7,132 * (per address fee) | /31 : 12,417 * (per address fee) | /30 : 21,619 * (per address fee) | /29 : 37,641 * (per address fee) | /28 : 65,536 * (per address fee) | /27 : 65,536 * (per address fee) | /26 : 65,536 * ... | ... ... | | | _____________________________________________________________________ | Advantages and disadvantages of adopting the proposed policy: | (Explain what you believe to the be the main advantages and | disadvantages that would flow if APNIC adopted your proposal.) | --------------------------------------------------------------------- | | 1. Why adopt the upper limit for per address fee? | | Changing the fee structure should be acceptable for all the stakeholders, | APNIC, APNIC members, and NIRs (NIR members). That is; | | (1) For APNIC | - New structure should not have siginificant inpact on APNIC financlal | condition. | | (2) For APNIC members | - New structure should not force current APNIC members to pay additional | fee. | | (3) For NIRs (NIR members) | - New structure should solve current problem. | - New structure should not cause unfairness amoung NIRs. | | When we see those points, this proposal meets points mentioned above. | | | 2. Other choices? | | 2.1 Discount per address (site) fee | | Even if you discount per address fee (ex. USD 0.02 to USD 0.01), it | won't help NIR so much since there is still no upper limit for per | address fee. | | | 2.2 Implement allocation fee (fixed fee per allocation) | | If this scheme is implemented, APNIC has to charge larger fee than | current per address fee corresponds to /20 or /19, in order to keep | the revenue from NIRs. This means smaller NIRs and NIR members are | charged more than current scheme, and this is not aceptable for them. | | | 2.3 Raise membership fee for NIRs | | This could be an appropriate solution for the problems, however we | do not take this here since we cannot propose concrete NIR fee | structure which is acceptable for all NIRs without knowing how much | each NIR pays yearly including both membership fee and NIR fees. | | | 2.4 Revise current fee structure as a whole, involving all APNIC | members | | It takes time and probably this is not acceptable for current APNIC | members. | | | 3. Why 262,144 hosts (65,536 sites in IPv4) are the upper limit? | | Based on the stats JPNIC has, /14 (in IPv4) is the appropriate level | we can agree on. If we set the upper limit at /14, APNIC doesn't lose | much revenue from NIRs since currently there are not so many allocation | over /14. | | Below is the JPNIC allocation made to the members. | | (1) Recent 12 months (July 2003 to June 2004) | | /14+ : 5 (3%) | /14 and under : 185 (97%) | ---------- | /11+ : 0 | /12 : 2 | /13 : 3 | /14 : 1 | /15 : 6 | /16 : 15 | /17 : 11 | /18 : 20 | /19 : 37 | /20 : 95 | ----------- | | (2) January 2002 to December 2002 | | /14+ : 2 (0.8%) | /14 and under : 236 (99%) | | (3) January 2001 to December 2001 | | no /14+ allocation | | | 4. Why restrict to the allocation made from APNIC common address pool? | | Without this restriction, NIRs with its own pool can pay less than NIRs | allocating from APNIC pool, which may cause serious impact on APNIC | revenue. For example; | | (Case-1) | - When APNIC allocates /12 (4*/14) to NIRs as their address pool, | and NIRs allocate 4 * /14 to their members... | | 262,144 * USD 0.02 = USD 5,242.88 (/14 limit applied) | | +-------+ +------+ +-----+ | | APNIC |-----| NIRs |-------| LIR | | +-------+ +------+ | +-----+ | ----> | +-----+ | /12 |---| LIR | | | +-----+ | |--- | .. | .. | ------> | 4 * /14 | | In this case NIRs are to pay only USD 5,242.88, and can allocate | 4 * /14 to their members. | | (Case-2) | - When NIRs allocate 4*/14 to their members from APNIC addres pool... | | 262,144 * 4 * USD 0.02 = USD 20,971.52 >> USD 5,242.88 | | +-------+ +------+ | | APNIC |-----| NIRs |------+ | +-------+ +------+ | | | +--+--+ | |------------------->| LIR | | | /16 +-----+ | | +-----+ | |------------------->| LIR | | | /16 +-----+ | .. .. | .. .. | | In this case NIRs are to pay USD 20,971.52, much larger than case-1. | So we should have the restriction that proposed upper limit is only | applicable to the allocation made from APNIC common address pool. | | | (*remark) ---------------------------------------------------------- | Per address fee here is the one applied to ex.large members, and set | /14 upper limit. | -------------------------------------------------------------------- | | | In IPv6 case all NIRs allocate IPv6 block from APNIC pool so this | restriction is not applied. /28 (in IPv6) limit for per address fee | is applied to all NIRs. | | | 5. Detailed financial impact on APNIC operation | | (Subject to the calculation by APNIC) | | | _____________________________________________________________________ | Effect on APNIC members: | | Briefly explain how you think this may affect APNIC members. For | example will APNIC members save costs, have more efficient | administrative procedures, and so on. | --------------------------------------------------------------------- | | There is no negative impact on current APNIC members. | | | _____________________________________________________________________ | Effect on NIRs: | | Briefly explain how you think this may affect NIRs. If you are not | sure, leave this section blank. | --------------------------------------------------------------------- | | There is no fee raise for NIRs, and large NIR members can stay NIR | membership so all NIR and NIR members have a merit. | | (end of document) | | | | | -- | Toshiyuki Hosaka hosaka@nic.ad.jp | Japan Network Information Center (JPNIC) | Tel: +81-(0)3-5297-2311 Fax: +81-(0)3-5297-2312 | | | _______________________________________________ | sig-nir mailing list | sig-nir@lists.apnic.net | http://mailman.apnic.net/mailman/listinfo/sig-nir