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SIG: NIR
Minutes
Thursday 7 September, Grand Hi-Lai Hotel, Kaohsiung, Taiwan
Meeting commenced: 4:00pm
Chair: Izumi Okutani
Co-chair: David Chen
The Chair introduced the SIG and explained the agenda. There are no outstanding action items.
Contents
- CNNIC update
- TWNIC update
- IDNIC update
- APNIC fee discussions
- NIR's situation on APNIC fee review
- KRNIC's situation on APNIC fee review
- Discussions paper on the proposed revision of APNIC fee structure
CNNIC update
- It was noted that it is very good to see CNNIC doing such valuable work on historical resources in China. There was an offer for APNIC to collaborate on the transfer of responsibility that will arise from this work.
- None.
TWNIC update
- None.
- None.
IDNIC update
- IDNIC was encouraged to contact APNIC and other NIRs directly for input on the fee issues discussed.
- None.
APNIC fee discussions
- It was noted that if the current proposal proceeded, then it would be possible to finalise it in March 2007, with full implementation by 2008 (as existing members renew). It was noted that some of the issues require this to be determined sooner rather than later.
- It was noted there could be practical difficulties in implementing the discount for developing countries.
- It was suggested that one of the biggest problems with the current fee structure is that, in the absence of favourable currency movements, it assumes that productivity always increases to compensate with price indexing. It was argued that some form indexing would lead to much greater stability.
- There was a comment about the discrepancy between fee contributions and voting entitlements for NIRs in the proposed new structure.
- There was another comment about the impact of currency fluctuations and some wondered whether a future strengthening in the US dollar would then lead to another adjustment of the fee structure.
- It was noted that RIPE NCC fees are set on an annual basis to meet the requirement of the approved activity plan and budget. There was a general discussion of the operation of the RIPE NCC approach and it was noted that there are both risks and benefits of a fee structure that changes every year.
- There was a reminder that NIRs do have their own operational costs and this must considered in these discussions.
- There was a request for more clarification of the rationale for allowing voting entitlements to members of NIRs. It was explained that this request goes back several years to a time when there was a great expansion of activities in KRNIC. However, it was noted that this point is certainly up for discussion.
- None.
NIR's situation on APNIC fee review
- None.
- None.
KRNIC's situation on APNIC fee review
- It was clarified that KRNIC would hope to have a unified payment to APNIC, rather than separate payments from KRNIC and its members.
- It was explained that there is no intention for APNIC to directly charge the members of the NIRs. How the fee representing the NIR members is paid is something that would be up to the NIR.
- It was also clarified that there is not an intention to charge NIRs for historical ERX resources.
- It was also noted that the 50 percent discount level for NIR members has been chosen arbitrarily and could be discussed further.
- It was noted that APNIC has no knowledge of the details of what has happened with the pools of address space previously allocated to NIRs. Therefore it is assumed that these addresses should be included in the tier assessment. However, it would be reasonable for the NIR to use those pools to make direct allocations.
- There was a question about whether there is a need to form a new working group to allow more discussion among the general community. It was clarified that there is a working group mailing list but that it does not have a formal membership. It was suggested that the EC Treasurer would be an appropriate person to Chair such a working group.
- There was a comment that there is a need for the NIRs to understand more about the reason for the increases and for APNIC to understand more about the impacts on NIRs.
- None.
Discussions paper on the proposed revision of APNIC fee structure
- It was noted that the proposal presented today is different from the one on the mailing list. It was clarified that the details presented today represent the same methodology that was sent to the mailing list but were based on more up to date membership figures. It was also noted that the non-tiered method has not yet been formally proposed, but is an alternative method suggested in the EC meeting this week.
- It was noted that questions of fairness still remain in relation to the specific figures presented. It was explained that there will be an economy of scale, but it is intended to reduce the disparity by amending the way the economy of scale is implemented.
- It was suggested that the proposal slides presented in this meeting should also be presented in the AMM.
- It was stressed that it is important to ensure that non-NIR members are brought into these discussions.
- action nir-22-001: Secretariat to issue a call at the AMM for a volunteer to chair the fee working group.
Tao Chen, CNNIC
The presentation provided an update of recent activities in CNNIC, including CNNIC services and recent allocation work, historical status of resources in mainland China, and analysis of Internet use and future IP address needs in mainland China. Full details of these issues are available in the presentation.
Questions and discussion
Action items
Ching-Heng Ku, TWNIC
The presentation provided an update of recent activities in TWNIC, including staff changes, a review of the recent 6th TWNIC IP OPM, policy updates, and technical discussions. Full details of these issues are available in the presentation.
Questions and discussion
Action items
Ahmad Alkazimy, IDNIC
The presentation provided an update of recent activities in IDNIC, including the use of the name IDNIC rather than APJII, web site developments, recent OPMs, policy developments, discussions about small multihoming fees, and a range of other fee-related discussions. Full details of these issues are available in the presentation.
Questions and discussion
Action items
Paul Wilson, APNIC
This presentation summarised the current discussions surrounding the possible replacement of the APNIC fee structure. This was a refinement and extension of a presentation that was made at the previous NIR SIG. Full details are available in the presentation.
The history of the APNIC fee structure was reviewed. There was an analysis of APNIC's revenues and expenditures over time, including an explanation of the effect of exchange rates. It was noted that 2006 is the first time APNIC has actually budgeted for a loss, although it may not actually occur.
APNIC has been continuously increasing service levels in recent years. It has also become necessarily involved in many other activities that did not apply in the past. This has led to a greater need for expenditure.
There was a discussion of the nature of the one-off per-address fee which applies to NIRs and the lack of voting entitlements of NIR members.
There was a comparison of the respective costs faced by small and large members. To illustrate the lack of fairness in the current fee structure, it was noted that extra large members pay about three percent of the fees but hold more than 60 percent of the total address space. It was also note that voting is disproportionate, with NIRs holding relatively few votes and their members holding none at all.
The principles for a suitable fee structure were discussed. These are overall revenue maintenance, revenue adjustment, annual fee calculation, consistency between NIR and regular member fees, fairness, and equitable voting rights.
The presenter reviewed the feedback that has been received on these issues since APNIC 21. There has been sufficient interest in these issues to continue pursuing the reform.
The presenter demonstrated how these principles could be modelled into a realistic new fee structure for APNIC. The parameters for the current model are very similar to those presented at APNIC 21. There was a detailed presentation of a possible fee structure with 11 tiers and an analysis of the impact of such a structure on the current APNIC membership. In this model, the overall impact for APNIC would be a revenue increase of 18 percent. Normal members would see a two percent rise in fees, while NIRs would see a 112 percent increase.
The presenter discussed the other feedback that has been received since the current discussion paper was published.
One new suggestion that has arisen is to use a continuous formula rather than fixed tiers. This could be easily calculated using MyAPNIC. The advantage of this method is that a small increase in address holding would not result in a significant increase in fees, which would be the case in the tiered structure.
There was a discussion of allowing discounts for developing countries, with reference made to the scales used by some external organisations. It was noted that providing such discounts would not have a significant impact on the overall revenue model.
Questions and discussion
Action items
Ching-Heng Ku, TWNIC
This presentation summarised the current IP address holding of NIRs and the corresponding contribution to APNIC resources. Full details are available in the presentation. It was suggested that the current proposal would increase the financial contribution of NIRs by 250 percent. It was argued that this impact is unreasonable when the intention of the proposal is to increase APNIC's revenue by 10-15 percent. Also, the NIRs are of the opinion that historical addresses should be counted in the new fee proposal. The presenter reviewed the specific comments from each NIR, which are detailed in the presentation.
Questions and discussion
Action items
Billy Cheon, KRNIC
This presentation summarised the position of KRNIC on the proposed new fee structure. Full details are available in the presentation. The presenter noted that KRNIC would pay approximately three times their current fee under the proposed structure and this would pose difficulties in implementation. The presenter noted that Korean law means that it is impossible to separate KRNIC and its members. IP address are considered as public resources administered by the government. Also, the budget process in KRNIC means that there would need to be considerable lead times for any changes to the fee structure. The presenter noted that it would be desirable to add more segmented tiers to the current proposal covering KRNIC and its members together.
Questions and discussion
Action items
Toshiyuki Hosaka, JPNIC
This presentation was substantially withdrawn as there had already been good discussion of the issues that it was intended to raise.
JPNIC supports many aspects of the proposed new structure. It supports that NIR fees can be higher than they are now; however, there is a need for more explanation of why a 10-15 percent in revenue is required and more explanation of voting rights. There were other concerns that JPNIC had, but these have been dealt with in the preceding discussions.
The presenter briefly explained a counter proposal, which would add three more tiers above /8, with fees still doubling every two bits. This proposal would increase the fees on regular members by 4.5 percent and lead to a slight drop in NIR fees. It was also suggested that this counter proposal may produce a revenue increase of 18.9 percent and would be easier to implement.
Questions and discussion
Action items
Meeting closed: 5:55 pm
Minuted by: Gerard Ross
Open action items
action nir-22-001: Secretariat to issue a call at the AMM for a volunteer to chair the fee working group.
