http://www.ripe.net/ripe/docs/chargingbylirs.html


Charging by Local Internet Registries 

Mike Norris 
Daniel Karrenberg 


Document ID: ripe-152 
Date: 22 April 1996 





Contents
    1. Abstract 
    2. Internet Services 
    3. Registries and Resources 
    4. Special Case Registries 
    5. Recommendations 
     References 



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1. Abstract 
This paper deals with charging for services by Internet registries and 
indicates acceptable practice for such charging. It identifies name and 
address space as finite resources with no intrinsic value; as such, direct 
costs cannot be ascribed to such space. It also makes recommendations for 
the operation of European registries in general and additionally for those 
with monopoly positions. 

2. Internet Services 
In Europe as elsewhere, providers offer a range of services relating to 
Internet access. These include Internet connectivity, the provision of 
applications to end users, design, consultancy and training services, as 
well as system services such as IP registration, DNS, routing and packet 
forwarding. 

With some identifiable exceptions (which will be referred to later), there 
is generally an open market in the provision of such services. On the 
supply side, there is freedom to enter the market, to compete for business 
and to charge for services in order to stay in business. In this context, 
it is acceptable practice for Internet service providers (ISPs) to charge 
for services such as domain registration, routing services, packet 
forwarding and IP services. On the demand side, the general plurality of 
service providers means that customers have a choice; if not satisfied 
with the terms of one supplier, they can take their business to another. 

3. Registries and Resources 
Two of the above services involve the assignment of finite resources to 
customers: these are domain name space and IPv4 address space. They are 
managed and assigned by registration agencies, respectively domain name 
registries and IP registries. By themselves, these resources have no 
intrinsic value; their worth is only realised in conjunction with the 
provision of Internet access. Thus, while registries may charge for their 
administrative and technical services, they may not charge for name space 
or address space as such; no unit cost or price tag can be attached to a 
domain name or to an IP address, public or private. 

This principle must be made clear to the market in general and to the 
customer in particular. Customers must be aware of precisely what they 
are getting from the registry, whether it is paid for or not. Where 
there is a charge, the customer must not be under the illusion that 
this translates into a unit cost per resource assigned, nor that the 
transaction is an indefinite transfer of ownership of the merchandise. 
Finally, the customer must accept the terms under which name or address 
space is assigned. In the case of IP address space, these include the 
contractual term that the assignment is only valid for so long as the 
criteria of the assignment are valid (1st exception). As soon as the 
original criteria no longer apply, the address space must be returned 
without penalty or premium to the assigning registry. 

4. Special Case Registries 
As indicated above, there are certain exceptions to the market principle 
in the Internet registration services. These occur where, by virtue of 
their location in the hierarchy of Internet registration, certain 
registries find themselves in a monopoly position. In the case of name 
space, this applies to top-level domain (TLD) registries (in Europe these 
are all country registries), as well as certain administratively unique 
second-level domain registries (such as .co.uk, .ac.at, etc.). When it 
comes to IP address allocation, regional registries constitute monopolies 
within the communities they serve. The RIPE NCC is the regional registry 
for the European region (2nd exception). Other possible examples are the 
last resort (non-provider) IP registries, although nowadays the customer 
has an alternative to their services. 

It is important that there is transparency in the procedures and accounts 
of such "special case" registries. They must not generate excessive surplus 
by virtue of their monopoly position. 




5. Recommendations 
To attain the objectives outlined in this paper, it is recommended that all 
registries: 

- publish their operating procedures; 
- publish details of the services they offer and the conditions and terms that 
apply, including scales of tariffs if applicable; 
- explicitly publish the fact that they do not sell name or address space as 
such. 

As for "special case" registries defined above, it is recommended that where 
such a registry charges for service, it should, in addition to complying with 
the recommendations listed above: 

- relate charges to costs of operation and apply all revenues to such costs; 
- regularly publish a budget of its anticipated operating costs and revenues; 
- publish guidelines and apply these uniformly; 
- ensure equality of access to registration services; 
- aim to achieve consensus within the community it serves as to the disposal 
of any surplus revenues; 
- regularly publish accounts of income and expenditure; 
- refrain from using their unique position as leverage in any other business 
venture. 




References 
1. European Internet Registry Policies and Procedures by Orange, C., Kuehne, 
M., Karrenberg, D. 

2. Delegated Internet Registry in Europe (ripe-112, 1994).