2. Motivation

With the proliferation of TCP/IP technology worldwide, including outside the Internet itself, an increasing number of non-connected enterprises use this technology and its addressing capabilities for sole intra-enterprise communications, without any intention to ever directly connect to other enterprises or the Internet itself.

The Internet has grown beyond anyone's expectations. Sustained exponential growth continues to introduce new challenges. One challenge is a concern within the community that globally unique address space will be exhausted. A separate and far more pressing concern is that the amount of routing overhead will grow beyond the capabilities of Internet Service Providers. Efforts are in progress within the community to find long term solutions to both of these problems. Meanwhile, it is imperative that the approaches to these problems not be in conflict.

The IANA's recommended strategy for address allocation calls for address space to be allocated in a manner that permits aggregation of routing information to prevent routing overhead from growing beyond the capabilities of Internet Service Providers.

One effect of this strategy has been that the number of IP network numbers allocated is significantly smaller than the number of hosts needed in the Internet. However, many enterprises use TCP/IP extensively outside their connection to the Internet, and the intent to connect to the Internet is at best ambiguous.

Such enterprises need a reasonably large amount of address space because they have a large number of hosts, and have no intention or plan to connect to the Internet, or may connect only in the distant future. In fact, even when a decision is made to connect, it is sometimes impossible to predict the time of connection many years in advance, or even whether it will be necessary to reserve IP addresses at all.

For networks with relatively few hosts, the administrative cost of obtaining unique IP addresses may not be justified. On the other hand, even large enterprises may not want to expose their internal topology, for privacy or security considerations, even if the cost of doing so may be low.

It is useful to explicitly distinguish between addresses that are to be used by hosts which do not require global uniqueness from addresses that are to be used by hosts which do require global uniqueness. This will allow address allocators to be explicit about the size and use of private address space, enabling them to estimate future address requirements more precisely. It will also make it easier for routers to be configured to handle traffic from enterprises to the external Internet.