IPv4 Exhaustion and Price Surges: What’s Really Driving Costs

IPv4 addresses used to be something nobody thought about. You bought hosting, got an IP, pointed DNS, and moved on. Over the last few years, though, we have watched IPv4 move from an invisible technical detail to one of the biggest hidden cost drivers in hosting, networking and data centers. As the dchost.com team, we see this in real quotes for IP blocks, in RIR policy changes, and in the way providers all over the world are restructuring their plans. If your invoices now include line items like “extra IPv4 surcharge” or your provider suddenly reduced the number of bundled IPs, this is not random. It is the direct result of decades of IPv4 exhaustion finally turning into a real, global price surge.

In this article we will unpack what is actually happening behind the scenes with IPv4 exhaustion and pricing, why costs have climbed so quickly, and how this affects your web hosting, VPS, dedicated servers and colocation projects. More importantly, we will walk through practical strategies you can use with your dchost.com infrastructure to control IPv4 expenses while staying secure, SEO‑friendly and future‑proof.

Why IPv4 Is Running Out

IPv4 was designed in the late 1970s with a 32‑bit address space. That gives roughly 4.3 billion possible addresses (2³²). At the time, nobody imagined billions of smartphones, smart TVs, IoT devices and cloud servers. The original allocation model was also extremely generous: universities, enterprises and organizations received huge blocks like /8 (over 16 million IPs) and /16 (over 65,000 IPs), often using only a fraction.

Over time, the Internet Assigned Numbers Authority (IANA) handed large chunks of IPv4 space to the five Regional Internet Registries (RIRs): ARIN, RIPE NCC, APNIC, LACNIC and AFRINIC. Each RIR then allocated IPv4 to ISPs and organizations. By the early 2010s, the global “free pool” ran out. Each RIR reached various “exhaustion phases”, introducing strict policies and smaller final allocations. Today, you cannot simply request a big fresh block of IPv4 from a registry; you must either qualify under very narrow criteria or buy/lease from someone who already owns addresses.

Technologies like NAT (Network Address Translation) delayed this crunch. ISPs could put many users behind one public IPv4. Hosting providers could place many websites on a single IP with name‑based virtual hosts and SNI for HTTPS. But NAT and sharing only slow down consumption; they do not create new IPv4. As more services want their own addresses (for email reputation, SSL termination, VPN endpoints, APIs, etc.), pressure on the remaining IPv4 pool keeps rising.

How IPv4 Exhaustion Turned Into a Price Surge

Once the RIR free pools were effectively empty, IPv4 started behaving like a scarce commodity. That is when pricing really took off. Internally at dchost.com we have seen address prices in some regions multiply several times within just a few years. The drivers are a mix of policy, market dynamics and genuine demand.

From Allocation to Transfer Markets

Before exhaustion, your ISP or hosting provider could obtain IPv4 directly from its RIR at a low, predictable cost based mostly on membership fees. After exhaustion, RIRs introduced transfer policies: organizations can sell or transfer part of their address space to others, subject to justification rules. This opened a secondary market.

Now, when a provider needs, say, a /22 or /20, they often have to buy it from another company through a broker. The seller wants the highest possible price; the buyer needs addresses urgently for new customers, new data center regions, or expansions. Over time this pushed per‑IP pricing steadily upward. In some regions, RIR policy changes amplified this trend. For example, updates like the ones discussed in our article on ARIN IP allocation changes and their impact on IPv4 scarcity affect both who can get addresses and how many are still circulating.

Speculation, Hoarding and Fragmentation

Once IPv4 became clearly scarce, some organizations started treating it like an investment asset. Instead of returning unused space, they held onto it or sold selectively at higher prices. This is rational from their perspective but it reduces the number of blocks available on the open market and increases fragmentation (more small blocks instead of large contiguous ones).

Fragmentation has its own cost. Routing more and smaller prefixes consumes memory and CPU on routers. Managing multiple tiny subnets adds operational overhead. That overhead is baked into the per‑IP price you eventually see passed on through hosting, VPS and server plans.

Real Demand: Cloud Growth, AI and Edge

On top of speculation, there is very real and legitimate demand. Every new data center, CDN edge node, 5G POP, IoT platform, VPN service or security appliance cluster wants public addresses. Even with aggressive IPv6 adoption, many of these services still need IPv4 for backward compatibility. AI and high‑density compute clusters increase server counts; more servers mean more IPs for management, load balancers, and customer workloads.

We have written about how data center expansions are accelerating due to AI and modern workloads. The same macro trend is quietly driving IPv4 demand. When more infrastructure goes live without a matching increase in IPv4 supply, prices go one way: up.

Documented Price Records

This is not just theory. The IPv4 brokerage and RIR communities regularly publish aggregate data showing average prices per IP. Over the last years, unit prices have repeatedly hit new highs, especially for clean, well‑documented address blocks with clear ownership. We covered this in more detail in our article on why IPv4 address prices are hitting record highs and how to protect your budget. The important takeaway: what used to cost almost nothing is now a significant, visible line in hosting providers’ cost structures.

Where You Actually Feel IPv4 Costs as a Hosting Customer

Most organizations never buy IPv4 blocks directly from RIRs or brokers. Instead, they experience IPv4 scarcity indirectly, through changes in hosting and server offerings. At dchost.com, we design our plans with this new reality in mind while trying to keep them predictable and fair for customers.

Fewer Bundled IPv4 Addresses per Server

Years ago it was common to get multiple IPv4 addresses bundled with a VPS or dedicated server “just in case”. Today, you will typically see:

• One primary IPv4 address included per VPS or dedicated server
• Additional IPv4 addresses available as paid add‑ons
• Strict justification for extra IPs (SSL for legacy clients, specific network appliances, etc.)

This is not upselling for the sake of it; it is a direct response to real per‑address costs. Each extra IP has an acquisition cost, ongoing registry fees and operational overhead. When you request 10 dedicated IPv4s for a small project, you are asking your provider to permanently bind 10 scarce resources to that use. Naturally, that has a price.

Dedicated IP Pricing for Email and Reputation

Many businesses want a dedicated IPv4 address for email sending to control their reputation and reduce the risk of collateral damage from other senders. As IPv4 prices climb, dedicated IPs for mail infrastructure become more expensive and are sometimes limited to higher‑tier plans.

This makes it even more important to use that address wisely: warm it up slowly, monitor your sender score, and avoid spam complaints. If you rely on dedicated IPs for transactional email, our guide on dedicated IP warmup and email reputation management is worth a close read. In an IPv4‑scarce world, burning an IP’s reputation can become a costly mistake.

Shared IPv4 and Name‑Based Virtual Hosting

Shared hosting has always used one IPv4 to serve many domains. Thanks to SNI (Server Name Indication), HTTPS can also work correctly in this model: the browser tells the server which hostname it is connecting to during the TLS handshake. This means that for most websites, a shared IPv4 is technically sufficient.

What changes with price surges is the incentive to consolidate more domains onto fewer IPs. On our shared hosting platforms at dchost.com, we carefully balance consolidation and performance. Architecturally, we focus on isolation (cgroups, CloudLinux‑style limits, hardened PHP handlers) rather than giving each small site its own IP, because the latter is now economically unrealistic for many use cases.

Restructured VPS, Dedicated and Colocation Models

For VPS, dedicated servers and colocation, you will see more focus on IPv4 efficiency and clear IPv6 options:

• Base offers with one IPv4, with additional IPv4s available as add‑on resources
• Generous or even /64‑sized IPv6 allocations included at no extra cost
• Recommendations to keep IPv4 for public‑facing endpoints and use IPv6 internally where possible

dchost.com follows this approach: we make sure you always have the IPv4 connectivity you need, but we also provide strong IPv6 support so you can gradually reduce how dependent your architecture is on expensive IPv4 space.

Technical Escape Routes: NAT, CGNAT and IPv6

Providers and network engineers are not simply accepting IPv4 price hikes. There are several technical strategies to stretch existing IPv4 space. Each has pros and cons you should understand when planning your infrastructure.

Classic NAT and Private Addressing

Inside your infrastructure, using private address ranges (RFC 1918: 10.0.0.0/8, 192.168.0.0/16, etc.) with NAT at the edge is standard practice. Hundreds of VMs or containers can sit behind one public IPv4, accessing the Internet via a shared outbound address. For inbound traffic, you map specific ports or IPs to internal services.

For typical web hosting, this looks like a load balancer or reverse proxy with a small number of public IPv4 addresses terminating connections and routing them to backend servers on private subnets. This allows you to grow your server fleet without increasing your public IPv4 footprint linearly.

Carrier‑Grade NAT (CGNAT)

ISPs use Carrier‑Grade NAT to put thousands of customers behind a small pool of public IPv4s. This is why your home connection often has a private (10.x or 100.64.x) IP externally: the ISP’s CGNAT gateway hides many users behind one shared IPv4.

CGNAT works, but it has side effects:

• Inbound connections to customers (hosting servers at home, some VPN scenarios) become harder
• Some applications break or behave poorly due to shared ports and aggressive timeouts
• Abuse or rate limiting may affect innocent users sharing the same public IP

For normal web browsing, CGNAT is fine. For serious hosting, you still need proper public addresses on your servers or at your data center edge.

The Real Long‑Term Solution: IPv6

IPv6 uses 128‑bit addresses, providing an astronomically large address space. From a purely numerical perspective, IPv6 permanently eliminates address scarcity. You can assign unique global IPv6 addresses to every server, container, IoT device and even every user session without worrying about “running out”.

Adoption, however, is the tricky part. Many networks, applications and devices still assume IPv4. Browser and OS support for IPv6 is excellent, but not all ISPs and corporate networks have fully enabled it. That means we live in a dual world for now: IPv4 remains necessary for compatibility, while IPv6 grows as the preferred protocol for new deployments.

We have covered this shift in several articles, including why IPv6 adoption is accelerating and what it means for your infrastructure. If you are planning new projects, ignoring IPv6 at this point is a strategic mistake.

Dual‑Stack vs IPv6‑Only Architectures

A practical question we hear from customers is: “Should I run dual‑stack (IPv4 + IPv6) or go IPv6‑only and use translators?” The answer depends on your audience, application and risk tolerance.

• Dual‑stack: Your services have both A (IPv4) and AAAA (IPv6) DNS records. Clients that support IPv6 will use it; others fall back to IPv4. This maximizes compatibility but still requires IPv4 addresses.
• IPv6‑only with NAT64/DNS64 or proxies: Your servers only have IPv6. Special gateways translate IPv4 traffic when needed. This can drastically cut your IPv4 usage but adds architectural complexity.

We explored these patterns in depth in our guide on choosing between IPv6‑only and dual‑stack hosting for websites, email and SEO. In short: for most customer‑facing sites today, dual‑stack remains the safest option. For internal services, APIs between your own systems, and new greenfield infrastructure, IPv6‑first or even IPv6‑only is increasingly realistic.

Enabling IPv6 on Your VPS and Servers

The good news is that turning on IPv6 support in your own stack is no longer exotic. Modern Linux distributions, web servers (Nginx, Apache, LiteSpeed), databases and load balancers all support IPv6 natively. On dchost.com VPS and dedicated servers, you can obtain IPv6 allocations and configure them alongside IPv4.

If you have not done this before, our detailed tutorial on IPv6 setup and configuration on a VPS walks through address assignment, firewall rules and testing. Starting with dual‑stack on a single VPS is a low‑risk way to gain confidence before scaling IPv6 to your entire environment.

Designing Your Own IPv4 Strategy with dchost.com

IPv4 exhaustion and price surges are global facts, but how much they hurt your budget is largely a design question. The way you architect applications and choose hosting products has a direct impact on how many IPv4 addresses you truly need. Here is how we recommend approaching this, based on real‑world projects we see every week.

Step 1: Classify Where You Really Need Dedicated IPv4

List all the ways your organization uses IPv4 today, then categorize them:

• Critical dedicated IPv4: Outbound email IPs, public APIs where you must control reputation or firewall rules, VPN endpoints that partners whitelist by IP.
• Shared/virtual hosting‑friendly: Standard websites, landing pages, blogs, documentation portals and microsites that can safely live behind shared IPs.
• Internal‑only: Databases, internal dashboards, staging environments that could run on private IPv4 or pure IPv6.

For the first category, budget for dedicated IPv4 and protect it (reputation, security, change control). For the second, consolidate on shared IPs via our shared hosting or multi‑tenant VPS setups. For the third, aggressively move toward private addressing and IPv6.

Step 2: Use IPv6 for Growth, IPv4 for Edges

A pattern we see working well:

• Keep a small, stable pool of IPv4 addresses on your public edges (load balancers, mail gateways, VPN concentrators).
• Assign IPv6 addresses to every internal server, container and microservice.
• Use private IPv4 only where legacy software insists on it, and only inside your VPC/VLANs.

This way, when you add more application servers, cache nodes or background workers, you do not need more public IPv4s. Your IPv4 footprint grows slowly, while your internal capacity can scale almost freely using IPv6 and private ranges.

Step 3: Align Hosting Products with Your IP Plan

dchost.com offers shared hosting, VPS, dedicated servers and colocation. Each plays a role in your IPv4 strategy:

• Shared hosting: Ideal for many domains on shared IPv4, especially marketing sites, blogs and smaller projects.
• VPS: One or a few IPv4s as edges (web, API, VPN), with IPv6 and private networks for internal services and containers.
• Dedicated servers: When you need full control, high throughput or specialized networking (BGP, advanced firewalls), with carefully planned IPv4 blocks and extensive IPv6.
• Colocation: For large infrastructures bringing their own routing policies and often their own IP space, combined with IPv6‑heavy designs.

If you are not sure which mix is right for you, our comparison on colocation vs rented dedicated servers vs cloud architectures can help you see where your project fits and how IP addressing plays into each option.

Step 4: Document and Automate IP Management

As IPv4 becomes more expensive, treating it as a managed asset instead of a casual setting in a control panel pays off. Good practices include:

• Maintaining an IP address management (IPAM) sheet or system with ownership, purpose and contact details for each IP.
• Setting clear internal rules for assigning new IPv4s (who can approve, what justification is required).
• Reclaiming and reusing IPv4s when decommissioning servers or services, instead of leaving them “parked”.
• Automating provisioning (Terraform, Ansible) so changes are repeatable and documented.

We see a clear difference between teams that treat IPs as “just there” and those that manage them intentionally. The second group spends less and has fewer surprises when providers or RIRs update their policies.

Budgeting, Contracts and SLAs in an IPv4‑Scarce World

Technical architecture is half the story. The other half lives in contracts, SLAs and fine print. In an era of rising IPv4 costs, understanding how your provider handles IPs in their terms of service is critical.

Watch How IPv4 Is Described in Your Hosting Contracts

When reviewing hosting or colocation agreements, pay attention to:

• Whether IPv4 addresses are assigned or leased, and whether they can change.
• What happens to your IPs if you cancel or move services (renumbering requirements, grace periods).
• Charges for additional or “burst” IPv4 addresses beyond a base allocation.
• Any clauses related to IP reputation, blacklisting, and abuse complaints.

Our guide on how to read hosting SLAs and terms without missing hidden limits offers a checklist you can reuse whenever you sign new infrastructure deals. IPv4 is increasingly one of those “hidden limits”.

Plan for Renumbering and Migrations

If your provider ever needs to reclaim or restructure IP space (for example, after an acquisition or RIR policy change), you may be asked to renumber. Doing this at the last minute is stressful; planning for it makes it manageable.

To reduce pain during such transitions:

• Use DNS names for internal endpoints instead of hard‑coding IPs in application configs.
• Keep DNS TTLs reasonably low for critical records so changes propagate quickly when needed.
• Use load balancers or reverse proxies as stable “front doors” whose IPs change rarely, even if backend servers move.

dchost.com’s support team can help you plan migrations so that IPv4 changes do not turn into downtime or SEO issues. Combined with smart TTL strategies (we have a full article on DNS TTL tuning), you can usually absorb IP renumbering with minimal impact.

Forecast IPv4 Costs in Your 1–3 Year Budget

Finally, treat IPv4 like any other input cost that can change over time. When preparing budgets:

• Estimate how many IPv4 addresses you will need 12–36 months from now under your current growth trajectory.
• Multiply by realistic per‑IP pricing, assuming that market rates may continue to creep up.
• Include IPv6 rollout and application refactoring work as a parallel investment that reduces future IPv4 dependence.

This may feel like over‑planning, but we have seen organizations caught off guard by sudden IP‑related price revisions across their providers. Those who had forecasts and a clear IPv6 roadmap handled it calmly; those who did not had to scramble.

Key Takeaways and How dchost.com Can Help

IPv4 exhaustion is no longer a theoretical concern; it is shaping real‑world hosting plans, pricing models and network architectures. Scarcity has created a secondary market where IPv4 behaves like an expensive, slowly appreciating asset. That cost flows into every part of the stack: from how many IPs you get with a VPS, to the price of dedicated email IPs, to the way data centers design their edge networks.

The good news is that you are not powerless. By distinguishing where you truly need dedicated IPv4 from where shared or IPv6 options are fine, you can dramatically reduce your exposure to price surges. Dual‑stack designs, private addressing, and gradual IPv6‑first architectures let you keep compatibility while building a future where IPv4 costs matter less and less. Our various deep dives on IPv4 and IPv6 strategy, including why IPv4 address prices are rising and what you can do about it, offer additional perspective if you want to go further.

As the dchost.com team, we actively track RIR policies, IPv4 market trends and IPv6 adoption to design hosting, VPS, dedicated and colocation services that stay sustainable in this new reality. If you are planning a new project or need to reevaluate an existing stack, reach out to us. We can help you choose the right mix of shared vs dedicated IPs, size your VPS or servers correctly, and build a realistic IPv6 roadmap so IPv4 price surges stop being a constant worry—and become just another solved infrastructure detail.