Growing networks eventually face a familiar problem: demand for public IPv4 addresses increases, but available address space does not.
Internet service providers, hosting companies, cloud platforms, data centers, and other network operators often need more public IP capacity as customers, servers, applications, and infrastructure expand.
Two common approaches are to use address-sharing technologies such as Carrier-Grade NAT, or CGNAT, and to obtain additional public IPv4 capacity through IPv4 leasing.
Both can help organizations respond to IPv4 scarcity, but they solve different operational problems.
For some networks, CGNAT helps stretch existing address resources. For others, the ability to lease IP addresses provides the dedicated public connectivity needed for services that cannot easily operate behind shared address space.
Understanding the difference is important before choosing an IPv4 expansion strategy.
Why Public IPv4 Capacity Still Matters
IPv6 provides a much larger address space and remains central to the internet’s long-term development.
However, many businesses continue to operate in environments where IPv4 connectivity remains necessary.
Public IPv4 addresses may still be required for:
- Dedicated servers
- Cloud infrastructure
- Hosting platforms
- VPN gateways
- Enterprise applications
- Customer-facing services
- ISP subscriber networks
- Remote access
- Security appliances
- DNS and mail infrastructure
As networks grow, their existing IPv4 resources may no longer be sufficient.
At that point, operators need to decide whether to share existing addresses more aggressively or obtain additional public IPv4 space.
What Is CGNAT?
Carrier-Grade NAT allows a service provider to place multiple customers or devices behind a smaller number of public IPv4 addresses.
Instead of every subscriber receiving a unique public IPv4 address, several users can share the same public address through network address translation.
For service providers facing IPv4 scarcity, this can reduce the number of public addresses required.
CGNAT can therefore be useful when the main goal is to conserve existing IPv4 resources.
However, sharing public addresses also introduces additional operational complexity.
What Is IPv4 Leasing?
IPv4 leasing allows an organization to use public IPv4 address space for a defined period without permanently purchasing the addresses.
A company can lease IPv4 addresses and deploy them within its network according to the agreed routing and operational arrangements.
This can provide additional public address capacity while avoiding the upfront capital required to purchase IPv4 resources outright.
For growing infrastructure, IP leasing can be particularly useful when address demand changes over time.
IPv4 Leasing vs CGNAT
The key difference is simple:
CGNAT shares existing public IPv4 addresses.
IPv4 leasing adds more public IPv4 addresses to the network.
That difference affects how each approach supports applications and customers.
CGNAT Focuses on Conservation
CGNAT is primarily a conservation mechanism.
If a provider has limited public IPv4 resources, CGNAT allows those addresses to serve more users.
This can delay the need to obtain additional IPv4 capacity.
However, the organization is still operating within the limits of its existing public address pool.
IP Leasing Focuses on Capacity
IP leasing increases the amount of usable IPv4 address space available to the organization.
Instead of placing additional customers or services behind shared public addresses, a network can deploy more dedicated public IPs.
This may be more appropriate when services depend on direct public connectivity.
When CGNAT Can Make Sense
CGNAT can be suitable when users primarily consume outbound internet services.
For example, residential broadband subscribers who mainly browse websites, stream content, use social media, and access cloud applications may not always require dedicated public IPv4 addresses.
In these environments, sharing IPv4 addresses can help an ISP support more subscribers with limited resources.
CGNAT can also be useful as part of a broader IPv6 transition strategy.
However, it should not automatically be treated as a replacement for public IPv4 capacity.
Limitations of CGNAT
Because multiple users share the same public IP address, CGNAT can introduce several operational challenges.
Port Forwarding Becomes More Difficult
Users behind CGNAT generally do not have direct control over the public IP address assigned to them.
This can complicate port forwarding and inbound connectivity.
Applications that require externally reachable services may therefore be more difficult to operate.
Troubleshooting Can Become More Complex
When multiple subscribers share one public IP address, identifying the source of a network event may require additional logs, timestamps, port information, and NAT records.
This increases operational overhead.
Some Applications Prefer Dedicated Public IPs
Hosting servers, VPN services, enterprise applications, security systems, and other infrastructure may require predictable public addresses.
In these situations, shared-address environments can be restrictive.
Reputation Is Shared
When several customers use the same public IPv4 address, their activities can influence the reputation associated with that address.
If one user generates abusive or suspicious traffic, other users sharing the same public IP may experience indirect consequences.
For network operators, this can make reputation management more complicated.
When Businesses Should Consider IPv4 Leasing
Organizations may consider IP leasing when they need additional public IPv4 addresses without purchasing them permanently.
Common scenarios include the following.
Hosting Infrastructure Expansion
Hosting providers often need public IP addresses for VPS instances, dedicated servers, control panels, customer services, and related infrastructure.
As server capacity grows, IP demand can increase quickly.
Leasing allows the provider to add address space alongside infrastructure growth.
Data Center Growth
Data centers supporting additional customers, racks, or services may require more routable IPv4 resources.
The ability to lease IPv4 addresses can provide additional capacity without requiring permanent acquisition for every expansion.
ISP Network Expansion
ISPs can use CGNAT to conserve addresses, but certain customers and services may still require public IPv4.
Leasing can help operators maintain a pool of public addresses for business customers, premium services, hosting, infrastructure, or other use cases.
Cloud and SaaS Platforms
Cloud services often require predictable public IP capacity for customer environments, gateways, APIs, infrastructure, and external services.
IP leasing can help align IPv4 capacity with changing demand.
Temporary or Project-Based Capacity
Some organizations only need additional IPv4 resources during migrations, deployments, regional expansion, testing, or temporary infrastructure projects.
Purchasing address space for these situations may not be economically efficient.
Leasing provides another option.
Can a Network Use Both CGNAT and IPv4 Leasing?
Yes.
For many networks, these approaches are complementary rather than mutually exclusive.
An ISP might place residential customers behind CGNAT while assigning dedicated public IPv4 addresses to business customers.
A hosting company may conserve addresses internally while leasing additional public IPv4 for services that require unique addresses.
A cloud operator could expand IPv6 deployment while maintaining leased IPv4 capacity for customers that still require IPv4 connectivity.
A hybrid model gives network operators more flexibility.
What to Check Before You Lease IP Addresses
Not all IPv4 address space is equally suitable for production use.
Before signing an IP lease, businesses should evaluate the operational characteristics of the address block.
Reputation
Check whether the IPv4 addresses have a history associated with spam, malware, abuse, or blocklists.
Poor reputation can affect legitimate services even after the addresses have changed users.
Routing Authorization
Determine how the address space will be announced.
Organizations using their own ASN should confirm the routing authorization process before deployment.
RPKI and ROA
If the prefix will be announced through BGP, the appropriate Route Origin Authorization may need to be created or updated.
Incorrect RPKI configuration can affect route validity.
Reverse DNS
Businesses operating mail, hosting, or infrastructure services may need control over PTR records and reverse DNS.
Confirm how rDNS requests are managed.
Geolocation
IP geolocation databases may continue showing historical location information after an address block changes networks.
For region-sensitive applications, geolocation correction support can be important.
Abuse Handling
A clear abuse-management process helps address legitimate complaints without unnecessarily disrupting services.
Renewal Terms
Network operators should also understand how long the addresses can remain available.
Changing IPv4 addresses later can require updates across DNS, routing, firewalls, allowlists, customer systems, and application configurations.
Why Continuity Matters in IPv4 Leasing
It is easy to compare IP leasing offers based only on monthly price.
However, production networks depend on stability.
Once an address block becomes integrated into a network, replacing it can be disruptive.
The organization may need to modify:
- DNS records
- Firewall policies
- Access-control lists
- Customer configurations
- BGP advertisements
- Monitoring systems
- VPN settings
- Application endpoints
For this reason, renewal continuity and provider reliability should be considered alongside cost.
Businesses evaluating IP leasing should understand not only how much the addresses cost, but also how routing, reputation, rDNS, geolocation, abuse handling, and renewals will be managed throughout the lease.
IPv4 Leasing and IPv6 Are Not Opposites
Organizations should also avoid treating IPv4 leasing as an alternative to IPv6 adoption.
The two can coexist.
IPv6 can reduce long-term dependence on scarce IPv4 resources, while leased IPv4 can support services and users that still require IPv4 connectivity.
For many networks, the practical strategy is gradual IPv6 deployment combined with careful management of remaining IPv4 demand.
How to Choose Between CGNAT and IPv4 Leasing
The decision should be based on the service requirements of the network.
CGNAT may be suitable when:
- The main goal is conserving existing IPv4.
- Users mainly require outbound connectivity.
- Dedicated public addressing is not essential.
- The network is prepared to manage additional NAT complexity.
IPv4 leasing may be more appropriate when:
- More public IPv4 capacity is required.
- Customers need dedicated public IP addresses.
- Applications require inbound connectivity.
- The organization wants predictable public addressing.
- Infrastructure is expanding faster than existing IPv4 resources.
- Buying IPv4 would create unnecessary upfront cost.
In many cases, the optimal approach includes both.
Final Thoughts
IPv4 scarcity forces network operators to make deliberate decisions about how public addresses are allocated.
CGNAT helps organizations stretch existing IPv4 resources by allowing multiple users to share public addresses.
IPv4 leasing, on the other hand, gives networks access to additional public IPv4 capacity.
For businesses that need direct public connectivity, predictable addressing, or additional space for expanding infrastructure, the ability to lease IP addresses can provide valuable flexibility.
The decision should not be based only on address availability.
Routing, reputation, RPKI, reverse DNS, geolocation, abuse management, and renewal continuity all affect whether an IPv4 block can function reliably in production.
Organizations planning network expansion can explore IPv4 leasing through LARUS and evaluate address capacity based on their routing, deployment, and long-term infrastructure requirements.
Frequently Asked Questions
What is IPv4 leasing?
IPv4 leasing allows an organization to use public IPv4 address space for an agreed period without permanently purchasing the addresses.
Why do businesses lease IP addresses?
Businesses lease IP addresses to expand network capacity, reduce upfront expenditure, support temporary or growing infrastructure, and obtain additional public IPv4 resources.
Is CGNAT the same as IPv4 leasing?
No. CGNAT allows multiple users to share existing public IPv4 addresses. IPv4 leasing provides additional address space that can be deployed by the organization.
Can an ISP use both CGNAT and leased IPv4 addresses?
Yes. ISPs may use CGNAT for some subscriber segments while assigning public IPv4 addresses to customers or services that require direct public connectivity.
Is IPv4 leasing better than buying IPv4?
It depends on the organization’s requirements. Leasing can provide more flexibility and lower upfront costs, while purchasing may make sense for organizations that want permanent long-term ownership.
What should businesses check before leasing IPv4?
Businesses should review IP reputation, routing authorization, RPKI/ROA, reverse DNS, geolocation, abuse processes, contract terms, and renewal continuity before deployment.
