Microsoft Buys IPv4 Address Blocks for $7.5 Million

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The Internet as we know it is running out of IP addresses. The current IPv4 system is only limited to 4 billion or so unique IP addresses, and some big companies get to spend millions just to get a few extra allocations.

Nortel’s assets are being sold off, and this includes more than 666,624 IP addresses. Microsoft snapped these up in an auction for a price of approximately $11.25 each, totaling about $7.5 million.

The last five blocks of IPv4 addresses were assigned to regional registries earlier this year, and IPv4 is said to be running out by late 2011. Networks are scrambling to make the switch to IPv6, although this will not be easy due to the need to implement infrastructure changes, and the need for backward compatibility with IPv4.

Now, Microsoft gets about 470,016 of these IP addresses, while 196,608 will be released as Nortel’s clients move to other service providers. The question is what Microsoft plans to do with all these IP addresses. Does it have a new cloud-based service or software in the making? Will they use this for internal purposes? Or will they sell the IP addresses at profit?