Minutes

SIG: NIR

Wednesday 7 September 2005, Melia Hotel, Hanoi, Vietnam

Meeting commenced: 11:00 am

Chair: Izumi Okutani

Co-chair: David Chen

The Chair introduced the SIG and explained the agenda, noting that the addition of a discussion of the NIR fee structure progress may reduce the time available for regular NIR updates.

Contents

  1. Open action items
  2. Explanation of recent IPv6 fee structure change (NIRs and Confederation members)
  3. Abolishing IPv6 per address fee for NIRs
  4. NIR fee structure update
  5. VNNIC update
  1. Open action items

  2. Action nir-19-001: James Shim from KRNIC to make suggestions to APNIC to expand the ERX FAQ to include information relevant to NIR members.
    No update.

    Action nir-19-002: The APNIC Secretariat to post APNIC financial information related to per address fees to the NIR SIG mailing list. The NIR fees WG will then use the information to further develop a proposal for more equitable IPv6 fees for NIRs.
    Done.

    Action nir-18-001: Pending approval at each remaining stage of the policy proposal process, Secretariat to implement this proposal (prop-022-v001).
    Done.

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  3. Explanation of recent IPv6 fee structure change (NIRs and Confederation members)

  4. Paul Wilson, APNIC

    Presentation [ppt | pdf]

    The presenter explained that the IPv6 per address fee has been the subject of many discussions. He also noted that it has been decided by the APNIC EC that there was a need to take some action on this issue in the interim period while the NIR fee structure is still under development. This decision is hoped to assist in IPv6 deployment.

    The presenter explained the difference between confederation members and NIRs. Confederations currently have a privileged position in terms of maintaining multiple pools of address space. However, because of problems with administration of confederation memberships, the confederation category has been phased out (although a small number of confederations remain). Under IPv6, use of the HD-ratio means that there is no need to maintain multiple address pools. This allows ISP confederations to be treated exactly the same way as normal members with respect to management and billing of IPv6.

    It is expected that implementing a replacement NIR per address fee schedule may take more than one year, but there was a need to solve genuine problems in the IPv6 per address fee. Therefore, the EC took the action to apply a 90 percent discount on NIR IPv6 per address fees for ISPs that already held IPv4 address space. This is justified because the networks have already been assessed by the APNIC hostmasters.

    Questions and discussion

    • None.

    Action items

    • None.

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  5. Abolishing IPv6 per address fee for NIRs

  6. Billy MH Cheon, KRNIC of NIDA

    Presentation [ppt | pdf]

    The presenter noted that this proposal has been prepared based on the opinions of all NIRs. This proposal was first presented as an informational proposal at APNIC 19, but has been updated based on opinions received since then.

    The proposal is that APNIC should not charge per address fees from NIRs until necessary. The presenter noted that per address fees are not charged to normal members and that the fee level becomes very high when large allocations are made. It was argued that the high per address fee may hinder IPv6 deployment in this region. The presenter explained that the contribution of IPv6 per address fees to the APNIC budget is not significant. It was also argued that this proposal would make the APNIC fee structure more consistent and simple.

    Questions and discussion

    • It was clarified that the per address fee changes with the tier of the member. For example, for Extra Large members, the fee is 0.2 US cents per /48. Also, the fee is only applied to the number of addresses considered usable under the HD-ratio.
    • It was noted that it is confusing to refer to this fee as "per address".
    • By clarification, it was explained that this proposal is intended to be a temporary solution.
    • It was suggested that the recent decision by the EC to apply the discount substantially solves the problem this proposal is addressing. The Chair sought the input from the other NIRs on this issue.
    • It was suggested that the EC's decision is too complicated.
    • It was also noted that some grey areas remain, especially in relation to the difference between ISPs that hold IPv4 and those that do not.
    • It was argued that since the ISP pays service fees to the NIR, and the NIR pays membership fees to APNIC, then there is no justification for the per address fee at all.
    • It was suggested that the problem for the initial allocation is addressed by the fee revision, but the full charge still applies to subsequent allocations. This complicates the charging scheme and does not totally solve the issue of unreasonable amount of fees.
    • It was noted that APNIC members only pay annual membership fees to APNIC, but some NIR members must pay annual membership fees to the NIRs as well as the per address fee. This creates inconsistency between NIR members and direct APNIC members.
    • It was argued that APNIC should make a new membership fee category for NIRs and abolish per address fees.
    • It was explained that KRNIC is paying 2c per /48 to APNIC and is charging its members 3c. KRNIC is receiving many complaints about this charge, with some complaining that charging per address fees is the equivalent of an address tax.
    • The background of the per address fee was explained. NIRs were seen as being able to receive IP addresses at a very low fee, which was considered unfair to regular members. This is why the per address fee was introduced.
    • The Chair noted that the SIG appears to hold a shared view that the per address fee is a problem, which must be dealt with in the long term.
    • It was agreed that the short term impact on APNIC of abolishing the IPv6 per address fee is negligible.
    • It was explained the EC chose to discount the fee rather than abolish it, as once a fee has been removed, it can be very difficult to re-establish it if it is required in the future.
    • There was a suggestion of amending this proposal to include a specific time limit on the removal of the per address fee.
    • It was argued that there are now more than 1,000 members and that the NIRs are in the minority. Therefore, it is necessary to find a good balance between simplicity to NIRs and the perception of fairness to regular members.
    • It was suggested that NIRs are willing to pay more in annual membership fees, but have significant problems with the per address fee.
    • The Chair asked for opinions on setting a two year time limit on this proposal, so that APNIC would be able to bring back the per address fee if no long term solution has been found for the fee structure. There was no consensus on this issue.
    • The Chair asked for show of hands on the proposal, as it was presented. The Chair noted that there was general consensus to adopt this proposal, with one objection.
    • It was clarified that it is still necessary to present this item at the APNIC Member Meeting for further approval.

    Action items

    • Action nir-20-001: Chair to refer proposal [prop-028-v001] to APNIC Member Meeting to seek further consensus.

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  7. NIR fee structure update

  8. Paul Wilson, APNIC

    The presenter provided a breakdown of APNIC's revenue from various sources. The current total annual fee from NIRs is $190,000. The presenter noted that historically, per address fees from NIRs (IPv4 and IPv6) range between 7 and 10 percent. Under the direct allocation model, APNIC has made allocations to 340 members of NIRs. This allowed a calculation of the annual fees that would have been payable to APNIC if those 340 LIRs had been APNIC members, which totals US$1,406,875.

    The presenter argued that a sustainable fee structure would be resilient to changes in NIR fee membership and NIR numbers and would be fair and consistent for all APNIC members.

    Total NIR fees (membership plus per address fees) in 2005 are equal to 11 percent of APNIC revenues. This is equivalent to about 40 percent of what would be payable if all of the NIR members receiving resources were actually APNIC members. Therefore, the same fee level could be achieved by applying a 60 percent discount to the normal APNIC fee structure.

    Questions and discussion

    • There was a comment that it is complicated to apply a discounted fee to NIR members. It was suggested that NIRs exist to help APNIC and it is not right to charge them more. However, it was argued in response, that the suggestion presented is quite simple.
    • There was a suggestion to simply abolish the per address fee and raise the normal membership fees.
    • It was argued that before considering rises in regular fees, it is necessary to remember that the NIRs represent only 6 out of 1,095 current members.
    • It was explained that this suggestion presented is not to intended to increase APNIC's revenue, but rather to ensure a sustainable model.
    • It was noted that in most NIR countries, LIRs have a choice whether to join the NIR or APNIC. The proposed fee structure change would provide an incentive for LIRs to join the NIR.
    • It was explained that the suggested changes would provide a more stable, predictable revenue stream for APNIC.
    • It was suggested that the issue is not that NIRs are looking for cheaper access to addresses, but rather than some of them simply do not agree with the specific model being discussed.
    • The Chair asked whether discussion should continue on revision to the NIR fee structure. There was general agreement to this, although there was also a suggestion to revise the entire fee schedule, not just in relation to the NIRs.
    • It was argued that there should be caution about opening up the question of revising the fee structure for regular members, as the process would take much longer and would be far more complicated. It was also noted that the proposal presented was carefully designed to not change the balance between NIR and regular membership contributions.
    • The Chair asked for continued discussion on the long term revision of the NIR fee schedule, including the removal of the per address fee for IPv4 and IPv6 addresses.
    • It was noted that JPNIC has also begun work on a proposal to change the fee schedule. This will be raised again on the mailing list.
    • There was a request that the NIR SIG should be allocated more time in future.

    Action items

    • None.

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  9. VNNIC update

  10. Phan Thi Nhung, VNNIC

    Presentation [ppt | pdf]

    The presenter provided an overview of VNNIC's recent activities, including the second VNNIC Open Policy Meeting, which included APNIC training on a range of technical and administrative issues.

    The presenter provided details of the a new fee structure recently adopted by VNNIC. She also presented the plans for 2006, including a plan to upgrade to the Very Large APNIC membership tier, rebuilding of the whois database, and holding of VNNIC 3 OPM.

    Questions and discussion

    • None.

    Action items

    • None.

The Chair apologised that, due to time constraints, the presentations by APJII, CNNIC, JPNIC, KRNIC, and TWNIC were not able to be presented, however these are available on the web site. The Chair thanked the sponsors and the participants.

Meeting closed: 12:40 pm

Minuted by: Gerard Ross

Open action items

  • Action nir-19-001: James Shim from KRNIC to make suggestions to APNIC to expand the ERX FAQ to include information relevant to NIR members. No update (APNIC 20).

  • Action nir-20-001: Chair to refer proposal [prop-028-v001] to APNIC Member Meeting to seek further consensus.

Minutes | NIR SIG

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