June 7, 2019

How IPv4 Address Brokers Improve the Market Outcomes

The significance of IP address brokers and how they make value is not obvious to many. Some people expressed their concerns that the presence of brokers in the market was leading to increase in prices for IP addresses. While this viewpoint is shared by some, it overlooks the many different ways brokers make the IP address market more valuable.

They Locate IPv4 Blocks

Firstly, brokers’ job includes digging and mining in to locate the blocks, which have been distributed but are unused, and bring these to the market. This increases the supply, which reduces price, as per economics. In order to perform their tasks, brokers trace defunct organizations’ history, make cold calls to companies to find those who handle the networks and ask about available address ranges, as well as work with the staff of Regional Internet Registries to make sure the history of a block is free of fraud. Therefore, brokers make sure a clean IP address supply in the marketplace.

They Act as Insiders to IPv4 Secondary Marketplace

Secondly, brokers offer valuable information regarding the price that is reliable than what you receive from other means, such as sending messages to the local ‘NIC’ or ‘NOG’ mailing list to find if an offer you got is reasonable. Brokers send data on price, which dates back many years and covers several transactions. By performing this, they support those in organizations who have to make a case for buying or selling IP addresses. Data on the sales of addresses given by brokers have featured on several investment memos, and they have been employed to support requests for selling the addresses.

They Are Transaction Facilitators

Thirdly, brokers make the transaction process simpler. From growing relationships with RIRs (Regional Internet Registries) to making standardized documentation, they help save both time and money of the address buyers. Brokers also offer free escrow services. Many companies tend to trade in the IP address market only a few times; therefore, growing in-house expertise is not necessary for these companies as it is simply a waste of their resources.

By carrying out all the above-mentioned things, IPv4 brokers allow organizations to concentrate on the trading part, and facilitate the whole process of extending their networks. Instead of raising the prices of IPv4 addresses, brokers help to bring down the prices by increasing the supply. Because most organizations do not wish to expend limited resources to form these capabilities, they are grateful for a broker’s services.