Supply of old-style net addresses is fast running out - but help is at hand.

The day is fast approaching when the supply of addresses for connecting new devices to the internet will run out. With just a couple of weeks' worth of addresses remaining, organisations are beginning to buy and sell what was traditionally a free commodity.

Murray Milner heads a taskforce set up to urge New Zealand organisations to prepare for the exhaustion of the supply of addresses that use the old standard - known as IPv4. He says he knows of an offer of US$5000 ($6479) that was made for a block of 10,000 addresses, valuing them at US50c apiece.

"I've seen a couple of emails that suggest a secondary market has developed and people are putting prices on IPv4 address blocks. It's reasonably quiet at this time but I think it will pick up during the year."

Milner's message is that money spent on IPv4 addresses would be better used to upgrade equipment to IPv6, the next-generation internet protocol. The taskforce, and internet governance bodies, have long been warning that organisations that aren't compliant with IPv6 will gradually become invisible on the internet, although the two protocols are expected to co-exist for as long as a decade.

Peter Dengate Thrush, the Wellington lawyer who chairs ICANN - effectively the UN of the internet - doesn't expect dire consequences when the IPv4 supply dries up.

With several steps in the supply chain, ordinary internet users won't immediately feel the shortage.

Addresses are doled out to Regional internet Registries (RIRs) by IANA, an organisation run by ICANN. IANA will have run out of IPv4 addresses by early next month, but Dengate Thrush says the RIRs should have enough to meet demand for months.

After that, whether the internet community likes it or not, he foresees trade developing in unused IPv4 addresses from among the 2 billion or so in circulation.

"The golden rule is that IP addresses are not monetised. When you get addresses from one of the RIRs, you don't pay per address, you pay a fee for membership and a fee for services almost independent of the size of address block you get.

"The IP community is concerned about a system that shifts from that to people buying and selling IPv4 addresses. But my prediction for a long time has been that this is coming."

Dengate Thrush likens an internet that operates on IPv4 and IPv6 addresses to a car with "an engine that copes with CNG and petrol".

But, eventually, the internet will be largely IPv6, which promises a profound change. Whereas the old 32-bit protocol is limited to about 4 billion addresses, 128-bit IPv6 can have 340 billion billion billion billion.

"What it means is there will be no difficulty in future with connectivity to the internet," says Dengate Thrush.

"We talk about connecting basically everything there is on the planet to the internet in some format so, for example, lamp posts can report when their bulbs need changing and every camera will have an IP address and can upload photos automatically."

The larger IPv6 addresses will also be able to carry more information than IPv4 ones, giving rise to new applications.

"I'm assuming entrepreneurs will be able to find uses for these extra features," Dengate Thrush says.

Nathan Ward, a consultant who will be talking about the transition to IPv6 at a conference of data network specialists in Wellington next week, doesn't expect it to be plain sailing for all internet users.

As internet service providers add customers, they may be forced to share IPv4 addresses among as many as four subscribers, potentially creating difficulties for applications that rely on users having unique addresses.

"It means things like gaming and peer-to-peer file sharing, that rely on user-to-user addressability, could become a lot harder," Ward says.

But it needn't be like that if organisations get on with upgrading equipment to IPv6. The Asia-Pacific region, with the burgeoning internet populations of China and India, is expected to run out of IPv4 addresses before any other, providing another incentive to upgrade soon.

Upgrading comes at a cost, but the IPv6 taskforce's Milner thinks trying to eke more out of IPv4 by securing a supply of addresses on the secondary market is false economy.

"In the end, it doesn't really solve the problem. People will find it much better - and lower cost - to adopt IPv6," he says.

Once 10-20 per cent of the country's internet infrastructure has converted, perhaps by the end of the year, the rest will follow more quickly, he believes. And if the Government took more leadership, that would help. "We would probably like it to be a little bit more forthright," Milner says.

Going, going ...
* Each device connected to a computer network needs an IP address.

* The current standard, IPv4, offers about 4 billion addresses.

* The new protocol, IPv6, allows many more addresses - 340 billion billion billion billion of them.

* To see when IPv4 addresses will run out, take a look at the IPv4 exhaustion counter on
Anthony Doesburg is an Auckland technology journalist