IPv6 rollout in the UK has been rather slow. Despite being standardised around 20 years ago, some major ISPs have still not completed the rollout of IPv6 to their customer base, particularly in the home broadband and mobile sectors. There are reasons for this, such as customers potentially needing new routers or to reconfigure their existing equipment. The question is whether government – including regulators such as Ofcom – needs to make the rollout of IPv6 mandatory by a given deadline.
Normally I’m cautious about governments and regulators intervening in the markets, not because I’m ideologically opposed to intervention, but because they often make things worse. However, IPv4 exhaustion is now, in my opinion at least, a competition concern. Existing providers have large blocks of IPv4 addresses, but it is extremely difficult for new businesses to acquire a sizeable allocation. At present, a new provider might get a /22, which equates to around 1,000 usable IP addresses.
If you are a shared hosting provider, you can work around a restricted number of IPv4 addresses by using techniques such as virtual hosts and Server Name Indication, which together allow you to host multiple sites over HTTPS on the same IP address. However, if you want to offer dedicated physical or virtual servers, you probably need to allocate at least one IPv4 address per server. This means that you are limited to a maximum of 1,000 servers, which may equate to just a few hundred customers and, if your pricing is competitive, a turnover in the low hundreds of thousands of pounds.
Since there are still lots of IPv4-only connections out there, the lack of addresses effectively acts a barrier to entry in the market (you can proxy IPv4 to IPv6 with HTTP, but I don’t know if this is possible for every protocol). Furthermore, the cost of obtaining IPv4 addresses has two additional distorting effects on the market:
- Forced consolidation of existing providers, such as Mythic Beasts acquiring Retrosnub, reducing consumer choice.
- Significant upward adjustments to the balance sheets of hosting providers who happen to have a large allocation of IPv4 addresses, because these assets have a scarcity value.
Ideally the regulatory response would be a combination of carrots (e.g. funding to rollout IPv6) and sticks (penalties if rollout is not completed by say December 2020). I’m not sure how to lobby to bring this about though, as I doubt my MP would know what IPv6 is and regulators tend not to listen to individuals.
You can view the talk from Pete at Mythic Beasts, which inspired this blog post, from UKNOF 34 on YouTube: IPv6 Only Hosting.