Private colleges and universities are increasingly eager to tap into additional streams of revenue beyond enrollment and tuition. Some schools may be expecting to benefit from the good graces of a heavyweight donor; others may operate an inn or theater. DeSales University’s windfall, on the other hand, started with a spammy-looking email.
Mark Albert, CIO and associate vice president for information technology at the Pennsylvania-based university, remembers being bombarded by tech brokers messaging him that his IP addresses could be worth up to $3 million. “It was too good to be true really,” he says. Michael Sweetana, director of finance and treasurer at DeSales, likened them to a Nigerian Prince scam.
“But I started looking into it and I did realize that the IP addresses were selling for $40 to $50 a piece,” Albert says.
Thanks to a bulk purchase made decades ago, DeSales just happened to be sitting on a “/16 block” of IPv4 addresses. In layman’s terms: roughly 65,000. DeSales sold their entire block in exchange for about 300 new addresses—and a cool $2.5 million.
“We are downsizing capabilities, if you will,” says Sweetana. “If you think about this more like a real estate transaction, we were able to put our entire block up for sale, find a buyer and get market rates. It was an opportunity to sell off some property that wasn’t tangible.”
DeSales, like many private institutions facing tighter budgets, is seeking innovative ways to optimize operations. Sweetana contends the university has done just that without having to take controversial measures, such as cutting programs, laying off faculty or selling its property.
Not only did the sale turn a profit but selling the block strengthened the university’s cybersecurity by restricting the number of its networks interacting with the public web. DeSales only needs about 15 IP addresses for students’ online use, dramatically increasing the school’s digital defenses.
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Furthermore, ARIN, where DeSales’ IP addresses are registered, helped modernize the university’s technology by granting it a block of IPv6 addresses. Each IPv6 address can support 1,028 times more IP addresses than an IPv4, according to ThousandEyes.
“I know many schools in possession of /16 blocks and could benefit from a similar monetization,” Albert says, “but there is a reluctance to make the move because there are very few instances where schools have taken on this project.”
Room for caution in IP address block transactions
Before a college or university begins to market its /16 block of IP addresses, it must thoroughly research its potential buyers. All IP addresses can be traced back to their previous owners through a central registry, so if a university sold its assets to a bad actor, the transaction could reflect poorly on the institution.
“The real big concern [about this transaction] was reputation,” Albert says, “like if somebody were to buy the IP addresses and started doing things that aren’t necessarily in line with DeSales missions or values.”
IPClear, a network technology service, helped DeSales find potential buyers. While DeSales cannot disclose its buyer, the highest bidders for educational institutions’ IPv4 addresses are telecommunications, IT companies, electrical cooperatives and utility companies, Fierce Network reports.
Additionally, DeSales’ IT team spread its 65,000+ IP address sales over six months to ensure the university didn’t unexpectedly lose any web presence or suffer any network hiccups. The IT team scoured abandoned IP addresses embedded with hard code and repeatedly tested and confirmed everything ran smoothly as they intermittently sold off chunks
“When you’re moving to another address,” Albert says, “you want to make sure all your mail catches up to you.”
