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IPXO loyalty program: Rent once, see a 30% markup. Even on your own subnet!
We manage IPv4 address space for several owners, including their listings on IPXO. Some just have unused addresses they want to make some money from, while others bought IPv4 blocks as an investment and expect a return.
The IPv4 leasing market is not that simple. Renters obviously want to pay as little as possible, while owners want to earn as much as they can. Somewhere in the middle, there's a market price that works for both sides.
For a long time, IPXO seemed to maintain some kind of balance. Or maybe they were just busy with other things. Who knows. But recently, prices on their marketplace have dropped dramatically. You can now find plenty of /24 subnets for less than $60/month.
At a first glance, that sounds great for renters. But I'm not sure it's good for anyone in the long run. When a marketplace operates on very thin margins, the quality of service and customer support usually suffers too. And IPXO's support is already pretty bad. How much worse can it get?
IPXO recently tried to improve its economics by effectively introducing subscription fees for medium and larger customers, along with extra charges for fairly basic things like ASN setup or updating IP geolocation. We thought that was already a pretty questionable direction for a marketplace.
But apparently, we hadn't seen the worst of it yet.
While checking prices across different company accounts, we noticed something strange: IPXO was showing different prices for exactly the same IPv4 subnets. After a bit of testing, we figured out the pattern.
Let's start with a pretty ridiculous example.
One of the IP holders we work with listed a /24 on IPXO for 60/month.IPXOtakes5%(3) from the owner and adds another $9 as a fee for the renter. So the owner gets $57, and the customer pays $69, which IPXO calls the "Final Price."
The company had also rented IPs through IPXO before, so we logged into its account and checked the price of its own subnet in the marketplace.
Guess what? It was listed for $87/month!
Yes, the owner of the subnet sees its own addresses listed for $87, even though it configured the final price at $69 and will only receive $57.
We did the math, and it turned out to be very simple:
$60 × 1.30 + $9 = $87
That's an additional 30% markup on the holder's price, on top of the regular $9 platform fee.
We checked other subnets and found exactly the same thing. For example, another /24 appears at $59/month for some companies and $74/month for others.
Same formula again:
$50 + $9 = $59
$50 × 1.30 + $9 = $74
So IPXO was showing two different prices for the same subnet. But who was getting the higher one?
And here's what we found.
Initially, we couldn't see any connection. We compared companies from different countries, checked their registration details, and tried switching accounts. Nothing obvious. Then another broker, who manages several companies on IPXO, noticed something.
All his companies rent out their own IPs, but only two had also rented IPs from others. One is still renting, and the other had rented a few times in the past.
And guess what? Only these two companies saw the higher prices. All the others saw the lower ones. We checked our own accounts, and everything matched.
So it's not about the browser, IP address, or country. We also checked some recently registered companies that are planning to rent IPs but haven't done so yet. They all see the lower prices too.
It looks like IPXO adds an extra 30% to the owner's price if a company has rented IPs before. Companies that have never rented anything see the normal prices.
Quite a loyalty program, isn't it?
But this is also a problem for IP owners.
When you list your IPs on IPXO, you check other offers and set a price that you think will attract renters. IPXO even shows you the "Final Price", including its fees. So you expect customers to see that price.
But you set $69, and some customers see $87 instead. You didn't choose this extra markup, you don't get any money from it, and IPXO doesn't even tell you about it.
And then you wonder why nobody wants to rent your subnet. And for most IP holders, the chances of ever finding out about this are close to zero.
If someone from IPXO is reading this, an explanation would be very welcome.
Comments
And here I thought IPXO was token based with their latest updates of fees/pricings/actions.
So it's like uber pricing. Telling customers one thing and the seller the other