Selling IPv4 Addresses for University Funding
Running a university isn’t easy on the pocketbook. Between salaries, services purchased, benefits, depreciation, supplies and equipment, and real estate, total annual operating costs for a major university can run into the hundreds of millions of dollars.
So, it’s no surprise that many colleges struggle to find sustainable funding sources necessary to keep their doors open and maintain quality education. Traditional methods such as tuition fees, government grants, and private donations may not always be sufficient to cover their financing needs.
Enter the world of IPv4 address blocks—a hidden treasure trove that many universities don’t realize they possess. This intangible asset could be the key to unlocking much-needed funds for dream programs and state-of-the-art campus facilities.
Higher education institutions are no strangers to financial hurdles. Even before the pandemic shook up the college landscape, many universities were already close to running over a fiscal cliff. But COVID accelerated the issue, according to CNBC:
“In a survey conducted by the Association of American Colleges and Universities, 74% of respondents said the most significant challenge facing their school is financial constraints. Smaller schools were more likely to report these concerns. A significant 79% of schools with fewer than 5,000 students said financial constraints are a significant challenge, compared to 52% of those from schools with more than 30,000 students.”
In the aftermath, colleges and universities are dealing with rising costs due to inflation, supply chain constraints, rising interest rates, and increasingly complicated compliance burdens. And these external pressures only compounded the existing financial challenges faced by universities, such as:
- Rising operational costs
- Administrative bloat
- Declining student enrollment
- Decreased government funding
- An impending student debt crisis
- Competition for private donations
IPv4 addresses are a unique string of 32-bit numerical values that identify devices on a network that uses the Internet Protocol version 4 (IPv4) communication protocol, known more colloquially as the internet. These addresses enable devices to communicate with one another over the internet or a local area network (LAN).
When the internet was first created, it was largely designed for research and education. And its earliest adopters were often universities.
Consequently, a significant number of these institutions were granted extensive allocations of IPv4 addresses, known as address blocks. These allocations often comprised tens and even hundreds of thousands of unique addresses, far exceeding the needs of the universities, then and now. And so, millions of IPv4 addresses were left to sit and gather digital dust—unused and, over time, forgotten.
For many universities, this oversight has turned into good fortune.
In the early internet, the concept of IPv4 address exhaustion was unimaginable. 4.3 billion unique addresses seemed to be a more than adequate supply.
As we know now, that’s certainly not the case. The internet grew over the decades and more and more devices began to connect to it—as such, the supply of available IPv4 addresses started to dwindle.
Today, IPv4 addresses are a scarce and valuable resource. In recent years, prices have increased by nearly 20% annually, rising from $10 in 2015 all the way to $60 at their peak in 2021.
While prices have dropped from the historic heights of 2021, they still hover around the $40 to $55 dollar range. With a block of 65,536 unused addresses—often found in higher education institutions—there are millions of dollars worth of potential funding opportunities for universities and their big-picture goals.
Even at a large institution, chances are, you won’t ever fully utilize all of the addresses that were originally allotted. Instead of letting them go to waste, several forward-thinking universities have taken actions to monetize these assets, thus allowing them to finance their campus projects.
If you think you’d like to join the ranks of those cashing in some of their IP assets, consider the following. In most cases, you’ll have one of three available pathways to IPv4 monetization:
Sell the unused IPv4 addresses outright – Some universities opt to sell IPv4 blocks. In exchange for a one-time lump sum payment, they then irrevocably transfer ownership to the new buyer.
Lease the IPv4 address – Other universities prefer to lease out their unused IPv4 blocks, rather than selling them.
Use IPv4 addresses as collateral for loans or investments – Want to secure a loan for a major project? You could also use your IPv4 addresses as a form of collateral to back the loan or investment. Of course, this carries a measure of risk—if you default on the loan, the addresses could then be seized. Also, were the assets to decline in value the lender might require additional collateral.
When it comes to selling or leasing your intangible assets, the most critical decision is who you’ll trust to broker the deal. The IPv4 market is frictional. Brokers make it less so by bringing buyers and sellers together.
A high-quality broker can provide reliable and transparent information and services. They can act as a trusted partner, helping you:
- Conduct a thorough inventory of all IP addresses that are currently in use or have been allocated to your university.
- Understand the market for IPv4 addresses, including trends, demand levels, and regulatory requirements.
- Determine the optimal pricing strategy according to your long-term goals.
- Square away all of the technical and legal aspects involved with the transfer of addresses.
- Sell or lease blocks for the highest price possible.
Faced with mounting operational and funding hurdles, universities must get creative when it comes to securing funding. Monetizing IPv4 addresses is one such solution that is often overlooked but could be the optimal funding mechanism.
As the world’s leading broker of IPv4 addresses and more than 55+ million addresses moved, the IPv4Global team can work with you to create a brokered solution that secures funding when you need it.
To learn more, contact our team today.