IP address leasing is renting a block of IP addresses from the organization that holds them, for a recurring fee, rather than buying the block outright or using addresses assigned by your internet provider. In practice it almost always means IPv4: the regional internet registries have largely run out of new IPv4 space to hand out, so organizations that need more turn to a market of holders willing to lease or sell unused blocks. A lease lets you use the block, usually including announcing it to the internet, for the term of the contract.
At a glance
- IP leasing is mostly an IPv4 market, driven by the exhaustion of new IPv4 supply at the registries.
- Leasing trades a lower up-front cost for an ongoing fee and no ownership at the end.
- Lessees usually route the block through their own providers, often using BGP and a letter of authorization.
- Reputation matters: a block with a history of abuse can carry blocklisting problems.
- Contract terms, registry records and routing authorization determine how secure your use of the block is.
What problem it solves
Most organizations get a small block of public IPv4 addresses from their internet provider along with each circuit. That is often enough, but not always. Sites that host many public services, organizations moving between providers, and those that want their own addresses so they can run multiple providers with BGP can need more than providers will give. Providers often ask for justification and may charge extra, because IPv4 addresses are scarce.
Buying a block on the transfer market is one answer, but it takes capital and a registry transfer process. Leasing offers the addresses without the purchase. It suits organizations with a defined or uncertain timeframe, those testing demand, or those that want to avoid a large one-time spend.
How it works
Supply. Some organizations hold more IPv4 space than they use, often from early allocations. Brokers and lease platforms connect them with lessees, or the holder leases directly. Many hosting and network providers also lease addresses as part of their services.
Contract. The lease sets the block size, term, monthly fee, renewal terms, permitted uses and what happens at the end. Pricing varies with block size, market conditions and terms, so get current quotes rather than relying on older figures.
Authorization. The holder typically gives a letter of authorization allowing your providers to accept announcements of the block. Registry records may be updated to show the lessee for abuse contacts. Many networks also expect a route origin authorization (ROA) under RPKI and an entry in an internet routing registry, created by the holder or with its help, so that the block’s announcements are accepted and validated.
Routing. You announce the block from your own autonomous system number through your providers, or ask a provider to announce it for you. Each upstream provider decides whether to accept the route: it typically needs the prefix to be large enough to be globally routable (commonly a /24 or larger for IPv4) and valid authorization from the lessor, such as an LOA, routing registry entries and RPKI records. Once accepted, the addresses work like any other static IP addresses.
Ending a lease. When the term ends, you stop announcing the block and the holder may lease it elsewhere. You need a plan to move services to other addresses before that date.
For help sourcing, leasing or buying IP space and planning IPv6, see our IPv4 and IPv6 Addresses solution page.
When it matters for buyers
- Your provider will not supply enough IPv4. Leasing can fill the gap without changing providers.
- Multi-provider designs. A suitably sized, properly authorized block can let you run BGP with two or more providers and fail over without renumbering, if each provider agrees to route it.
- Short-term or uncertain needs. Projects, migrations and new services may not justify buying a block.
- Budget timing. Leasing turns an up-front purchase into an operating expense.
- IPv6 planning. Leasing can buy time while you deploy IPv6 to reduce long-term IPv4 dependence.
Questions to ask vendors
- Who holds the block in the registry, and how is our right to use it documented?
- What is the block’s history, and is it on any current blocklists?
- Will you provide a letter of authorization, and will you create the RPKI route origin authorization and routing registry entries we need?
- Is the block large enough to be globally routable, and have other customers routed it through providers like ours?
- What are the term, price, renewal and early termination terms?
- Under what circumstances can you end the lease, and how much notice will we get?
- Do you offer an option to buy the block later?
- Who handles abuse reports sent to the registry contact for the block?
How it differs from a provider’s static IP addresses
The static IP addresses that come with an internet circuit belong to the provider: they typically work only on that provider’s connection and are returned when you cancel or move. A suitably sized, authorized leased block is held by a third party but can be used by you with any providers that agree to route it, so it can survive a change of provider and support multi-provider routing. Before signing a lease, get written confirmation from each prospective upstream that it will accept the route with the lessor’s LOA, routing registry and RPKI records. In exchange, you take on the lease contract, the routing setup and the reputation of the block. Buying a block through a registry transfer goes one step further and puts the registration in your own name, under the IPv4 and IPv6 address policies of the relevant regional registry, which vary by region.