Amazon Web Services (AWS) is set to generate millions in revenue by charging customers for public IPv4 addresses, according to internet infrastructure technologist Andree Toonk.
The decision, effective February 1, was first announced last year, when AWS said that the increasing scarcity of IPv4 addresses meant that a transition to IPv6 would be necessary, citing a 300% increase in acquisition costs over the past five years.
Toonk’s analysis reveals that the company could draw in between $400 million and $1 billion in revenue just by introducing the new charge for IPv4 addresses.
Amazon set to profit from IPv4 address charges
In-use Public IPv4 addresses, which were previously free, are now chargeable at $0.005 per hour, which equates to $44.80 annually. Secondary and idle elastic IPs, which were already chargeable at that rate, remain unchanged.
From February 1, the AWS Free Tier for EC2 now includes 750 hours of public IPv4 address usage per month for the first 12 months, according to Amazon’s announcement last year. That should be enough to last a single IPv4 address one year, effectively wiping the first $44.80 fee.
Toonk backed up Amazon’s announcement, revealing that IPv4 addresses have increased in value from less than $10 in 2014 to around $35 today, after hitting a high of around $60 during the pandemic.
The Regional Internet Registry for Europe (RIPE) revealed in 2019 that the world had finally run out of IPv4 addresses, which correlates with the spike in costs noted by Toonk. Customers can continue to purchase them by waiting for recovered addresses.
While there are only enough IPv4 addresses for 4.3 billion unique devices in the world, IPv6, introduced in 1998, promises to have a much greater availability of 340 undecillion (36 zeros). By not charging for these (yet), Amazon is urging customers to migrate to the more readily available IPv6.
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