An Internet Protocol (IP) address is a numerical identifier assigned to each device connected to the internet. Broadly speaking, IP addresses allow devices to talk to each other and exchange information. In ad tech specifically, IP addresses help geo-target advertisements and enable session-level frequency capping in cookieless environments.
Internet Protocol version 4 (IPv4) was released in 1983 and is still used for the majority of internet traffic today. IPv4 addresses are formatted using 32-bits, meaning there are a little over 4 billion unique combinations. In 1983, this seemed like more than enough unique IP addresses. However, due to the growing number of internet-connected devices, the American Registry for Internet Numbers (ARIN), announced in September 2015 that they had officially run out of IPv4 addresses.
The announcement from ARIN was not a surprise. It became clear in the early 1990s that IPv4 exhaustion was inevitable. In anticipation of this, the Internet Engineering Task Force (IETF) introduced a draft of the IPv6 standard in 1998, which was ratified into an internet standard in July 2017. IPv6 utilizes 128-bits and offers 340 undecillion (340 trillion, trillion, trillion) unique IP addresses. This means there are more than enough unique IPv6 addresses available for the growing number of internet-connected devices.
Today, IPv4 still accounts for the majority of internet traffic, despite the shortage of unique IP addresses. The continued use of IPv4 is made possible through the usage of Network Address Translation gateways, which allow multiple devices connected on the same network to share a single public IPv4 address. The transition from IPv4 to IPv6 will allow each individual device to have its own unique IP address.
IPv6 and Digital Advertising
At first glance, the idea of having a unique IP for each device may sound like IPv6 offers a new persistent identifier that can be used similarly to an IFA. However, according to Chris Row, systems engineer at SpotX that is not the case.
“It is a misconception that the increase in unique IP addresses available with IPv6 will allow advertisers to use IP address as a persistent identifier,” said Row. “The IP address for a device changes over time, this change can occur for a couple of reasons.”
First, IP addresses don’t belong to the devices using them, they are assigned by the network each device is connected to. Every time a device connects to a new network, it is given a new IP. Take your laptop, for instance. Each time you connect to a new network at work, at a cafe, or at the airport, your device is assigned a new IP address.
Second, Internet Service Providers (ISPs), Cox, AT&T, etc., usually assign dynamic IP addresses. Meaning, IP addresses periodically change, even if a device isn’t connecting to a new network.
“Generally speaking, the switch from IPv4 to IPv6 won’t mean much in terms of new capabilities for advertising,” said Row. “Just as with IPv4, IPv6 allows for geo-targeting and enables session-level frequency capping for cookieless environments. The biggest impact is the requirement for publishers and ad tech vendors to support IPv6.”
Currently, SpotX is partnered with a geo-targeting vendor that supports geolocation services for IPv6 addresses.
There is an obvious need for IPv6, but it has seen slow adoption. This is due to multiple factors, including cost, the complexity of migrating from IPv4 to IPv6, and existing workarounds that make it possible to postpone the update to IPv6.
For the reasons above, the transition to IPv6 won’t happen overnight, and IPv4 likely isn’t going away anytime soon. Instead, applications and ISPs will begin to offer support for both IP versions, a concept known as dual stack support. This allows for internet connected devices to communicate regardless of the IP version used.
Despite the obstacles, the transition to IPv6 is necessary and inevitable. Without IPv6, user experience would eventually be impacted. Programs would begin to slow down and devices would have a hard time communicating with each other, impacting things like internet speed and services like Voice over IP and web conferencing. Overall, the transition to IPv6 is good for everyone in the long run; it’s just going to be a slow journey.