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Value of IPv4 Assets

In the digital age, IPv4 addresses have become a valuable asset, driven by their scarcity and critical role in enabling internet connectivity. As the demand for online services grows, so does the importance of these addresses, making them an intriguing investment opportunity.

 

Understanding IPv4 Addresses

IPv4 (Internet Protocol version 4) addresses are unique numerical labels assigned to devices connected to a network, facilitating communication across the internet. The IPv4 protocol, which uses a 32-bit address space, offers approximately 4.3 billion unique addresses. However, the actual number of usable addresses is significantly lower due to reserved ranges for specific purposes, such as private networks and multicast addresses.

 

Scarcity and Value Appreciation

The finite nature of IPv4 addresses has led to a scarcity that has driven up their value over time. The exhaustion of free IPv4 address pools at Regional Internet Registries (RIRs) has intensified competition for the remaining addresses, pushing their market value higher. For instance, the first major IPv4 transaction, involving Microsoft and Nortel, valued each address at $11. Today, IPv4 addresses can trade for $50 to $60 or more, depending on the market conditions.

 

Impact on Market Capitalization

The value of IPv4 addresses is not just theoretical; it has real implications for companies, particularly in the telecommunications sector. For many telecom companies, IPv4 assets represent a significant portion of their market capitalization. This value stems from the critical role these addresses play in enabling online services, akin to the importance of prime real estate for physical businesses.

To illustrate this impact, consider a telecom company with a significant number of IPv4 addresses. If the average value of an IPv4 address is $50, and the company holds 1 million addresses, the total asset value would be $50 million. This valuation can constitute a substantial percentage of the company's overall market capitalization, underscoring the strategic importance of IPv4 holdings.

Major Telecom Companies and Their IPv4 Holdings

The following list showcases the IPv4 address holdings of major telecom companies worldwide. This data highlights the significant role these assets play in the market capitalization of these companies:

Telecom Company
IPv4 Held
% of market cap (Price of IPs owned / Market Cap (USD) x 100%
Cogent Communications Holdings Inc
38000000
0.56%
Verizon Communications Inc
38302720
0.11%
China Mobile Ltd
36117760
0.09%
Vodafone Group Plc
1823232
0.04%
NTT
45319734
0.24%
SOFTBANK Corp.
35599400
0.20%
Deutsche Telekom:
29069056
0.11%
Comcast
66159104
0.22%
T-Mobile USA, Inc
34280218
0.08%
Orange S.A.
24002553
0.38%
KPN(KPN B.V.)
6069504
0.20%
PCCW
1778423
0.30%
KDDI(kddi corporation)
16343872
0.13%
Telstra
14477152
0.25%
Telefonica SA
446464
0.01%
BT Group
18688
0%
Millicom International Cellular S.A.
512
0%
Telus Group
5221250
0.05%
América Móvil (AMX)
1774592
0.02%
SK Telecom Co Ltd
6673412
395.98%
KT Corp
47925
0%
LG Uplus Corp
7362617
1163.66%
Telia Company AB
460544
0%
AT&T Inc
87379344
0.32%
Graph Market cap.png

Investment Potential and Future Outlook

Despite the current valuation, many experts believe that IPv4 addresses are still undervalued. The potential for growth in their value is linked to several factors:

 

  1. Increasing Demand: As the number of internet-connected devices continues to grow, the demand for IPv4 addresses will likely rise, further driving up their value.

  2. Limited Supply: The finite nature of IPv4 addresses ensures that their scarcity will persist, making them a valuable commodity.

  3. Policy and Market Dynamics: Changes in regulatory policies and market structures could unlock additional value, particularly if restrictions on IPv4 transactions are eased.

 

IPv4 Value Calculator                                                                                                  

 

Calculate the Total Value of IPv4 Addresses

To find the total value of your IPv4 addresses, multiply the number

of addresses you own by the average market value per address.

 

Formula: Total Value=Number of IPv4 Addresses × Average Value

per Address

Example Calculation:

  • Number of IPv4 Addresses: 10,000

  • Average Value per Address: $50

  • Total Value = 10,000× 50 = $500,000

 

 

Calculate the Percentage of Market Capitalization

Next, determine how much of your company's market capitalization

is represented by your IPv4 assets. To do this, divide the total value

of your IPv4 addresses by your company's market valuation, then

multiply by 100 to get a percentage.

 

Formula: Percentage of Market Capitalization=

(Company Valuation Total÷ Value of IPv4 Addresses​) ×100

 

Example Calculation:

Total Value of IPv4 Addresses: $500,000

Company Valuation: $10,000,000

Percentage = (500,00÷10,000,000) × 100 = 5%

This percentage shows how much of your company's market value

is attributed to IPv4 assets.

 

The investment potential of IPv4 addresses lies in their critical role

in internet infrastructure and their increasing scarcity. For businesses

and investors, understanding the value of these assets is essential

for making informed decisions. As the digital landscape evolves, the

strategic importance of IPv4 addresses is likely to grow, presenting

significant opportunities for those who recognize their potential.

 

Further Resources

For more information on the market dynamics and potential of IPv4

addresses, please explore the following resources:

RIPE NCC IPv4 Addressing

ARIN IPv4 Depletion

LARUS Limited

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