The U.S. is about to run out of Internet Protocol (IP) addresses this summer. And while we're not exactly going to see a meltdown of the Internet, businesses will definitely feel the crunch when they discover prices for Internet addresses have gone sky-high.
IP addresses are like telephone numbers; they connect one device to another. When a computer to connect to a web page, or when someone posts a video on YouTube, or when a smartphone gets updated to Android Lollipop, the numerical codes that we call IP addresses all serve to link these devices together.
In the 1980s, the engineers who created the Internet created the IPv4 specification, which carries 4.3 billion IP addresses. Back then, the engineers figured they had created enough to cover the entire Internet, but it clearly isn't so. Speaking to the Wall Street Journal, American Registry for Internet Numbers (ARIN) president and CEO John Curran says only 3.4 million IP addresses remains. ARIN manages the 1.3 billion IP addresses assigned to North America, or about a third of the entire global supply. By summer, all the remaining 3.4 million addresses are expected to dry up.
And this is why big companies who are looking to maintain a massive online presence have begun snapping up spare IP addresses right and left, as the price of addresses will go much higher than the usual $11.25 they are sold for now. Microsoft, for instance, purchased 666,624 addresses for $7.5 million from the bankrupt Nortel Networks. Last year, Salesforce.com purchased 262,144 addresses for an undisclosed amount with the goal of continuously expanding its data centers to deliver its cloud-based enterprise services.
Facebook has taken a different approach. Instead of making hoard buys for IPv4 addresses, the social network has instead upgraded to the IPv6 specification, which was approved in 1998. IPv6 offers a much larger number of IP addresses. Specifically, it covers up to 340 undecillion addresses. That is 340 followed by 36 zeroes. Facebook engineer Paul Saab says the rapid growth of the social network's user numbers is aided by its decision to upgrade its network switches and routers to IPv6.
"If we had done nothing for our internal services, then we would not have been able to build new data centers," Saab says.
Eventually, all companies will have to follow in Facebook's footsteps and upgrade their hardware and software. However, smaller businesses might be deterred by the costs of upgrading early on. Research firm Gartner says migrating to IPv6 can cost 7 percent of the entire IT budget, making it more attractive to pick up IP addresses while they're cheap for the time being.
Photo: Norlando Pobre | Flickr
