A Black Market for IP Addresses?

The internet could run out of addresses as early as next year — and there are warnings that a “black market” could develop further.

The problem isn’t with domain names, which can be expanded simply by creating news suffixes, but rather with IP addresses. Those are the numbers which, to put things very simply, identify individual machines connected to the Internet.

Since the current addressing system (IPv4) use 32-bit addresses, this limits the address space to a maximum of 4,294,967,296 addresses. That’s well below the world’s population, and of course many people don’t have an internet connection, but when you throw in multiple machines, home and office connections, and other networks, you can see how that system — which once would have seemed as good as infinite — could be exhausted.

The numbers are allocated by the Internet Assigned Numbers Authority (the IP address department of the better known ICANN), and it’s just released two of the final batches. With just 7% of numbers left to go, it predicts the last batch will be released for use next September, and will be used up by April 2012.

The long-term plan is replacing the existing system, IPv4, with the new IPv6, which uses 128-bit addresses, for a maximum of 3.4×10³⁸ addresses. It’s been said (albeit as an unsourced Wikipedia entry) is enough that every person on earth could have the same number of different IP addresses as the number of atoms in a metric ton of carbon.

The drawback is that it’s not exactly practical to change every IP address in the world overnight. Instead, the two systems can be used side by side, but the process of smoothing the differences between the two systems can cause delays: not a major problem for an individual making a single connection, but a potential headache when repeated for every connection to a network.

Meanwhile there’s talk that the falling supply could create a “black market” in which addresses are sold unofficially at prices well above the official fee of $1,250 a year for 256 addresses. In the past, such sales have not technically been allowed, but administrators lately introduced a rule saying domains could be returned with instructions to issue them to another party: any money that changes hands is solely between the buyer and seller.

[Picture Source: Geek and Poke]