Comparing IPv4 vs. IPv6

Like comparing a beach ball to the sun

Steve Morkovsky
February 20, 2015

Executive Summary

The internet as we know began as a U.S. Defense Department experimental project called ARPANET,1“The Advanced Research Projects Agency Network (ARPANET) was one of the world's first operational packet switching networks, the first network to implement TCP/IP and one of the progenitors of what was to become the global Internet."2  For the last 35 years, the internet has been operating under Internet Protocol (IP). IP is the communications protocol used in packet switched or data networks and it allows for the identification of devices on the internet through a unique numbering system. The internet currently operates on two versions referred to as IPv4 (Internet Protocol version 4) and IPv6 (Internet Protocol version 6). As of December 2014, IPv4 carried 94% of internet traffic.3  While traffic will continue to grow on IPv6, both versions are expected to coexist for some time.

This matter is important for all businesses, but specifically to the technology industry as it affects nearly every technology business – from manufacturer of products such as routers, switches, advanced telecom equipment and networking gear to IoT (internet of things) enabled devices. This includes tiny internet connected sensors that transmit data to centralized servers and are used in applications such as industrial control systems, HVAC and automobiles, to systems in the home. Any technology product that wants to communicate data across the internet relies on IPv4 or IPv6.

Although it was ratified in December 1998, IPv6 was publicly launched in June 2012.4 The primary reason for the version jump was because the internet was running out of available addresses. Without sufficient addresses, internet-connected devices that we take for granted, such as routers, cell phones and tablets, would be unable to communicate with other devices. This limitation would simply mean no internet for you. (Sorry, we’re out of room!)


We have grown accustomed to taking the internet for granted and rely on it for essential information ranging from automatic weather updates to using Facebook or Twitter, texting friends and business associates, and online shopping or bill payments. What if the day came when you were no longer able to connect, or you had to share your connection with others, and only one of you could be on the internet at a time? Sound inconvenient? Given our reliance on the web, it would present a significant challenge, both personally and professionally. Without the transition from IPv4 to IPv6, these adverse scenarios could become a reality. 

Today, there are more and more devices connecting to the internet and each device needs a unique identifier to be able to send/receive data properly. Devices that were previously not internet-connected (e.g. smoke detectors, refrigerators, thermostats, various sensors) are now being connected in a worldwide phenomenon known as the “Internet of Things (IoT).” 

The subject of the exponential growth of internet connected devices was covered by OneBeacon’s Jack Fletcher in his whitepaper titled “The Internet of Things."5

Internet Engineering Task Force (IETF)

Today, the Internet Engineering Task Force or “IETF” is accountable for this domain. So who is IETF and who gave them permission to manage the internet? 

IETF is a task force made up of volunteers who are typically employed by computer-related firms. Promoting voluntary internet standards was first supported by the U.S. federal government, but starting in 1993 it began operating under the Internet Society6 with headquarters in Geneva, Switzerland and Reston, Virginia. Their mission is "to promote the open development, evolution and use of the Internet for the benefit of all people throughout the world."7

IPv4 & IPv6

One of the primary functions of the internet protocol is to identify devices connected on the network, which enables and facilitates the transfer and communication of data from one device to another. IPv4 and IPv6 are not interoperable. They are both distinct and require a translational mechanism to allow traffic to flow between IPv4 and IPv6 hosts.

The IP address is used to identify the location of these devices. An IP address is simply a series of binary numbers. IPv4 uses a 32-bit numeric address (four bytes of eight bits each), which is written in decimal as four numbers separated by periods. Each number can range from 0 to 255. For example, could be an IPv4 address. IPv6 addresses are 128-bits (16 bytes of eight bits each), which are written in hexadecimal and separated by colons. An example IPv6 address would be: fd19:6700:f359:9794:200:f8ff:fe21:67cf.8

The transition from IPv4 to IPv6 began in June 2012. Although IPv4 remains in use, the push is to support IPv6. However, the vast majority of devices currently are not using IPv6 as they lack the latest hardware and software updates to operate with the longer IPv6 addresses. Many larger websites (e.g. Google and Netflix among others) have sites utilizing both IPv4 and IPv6, although current visitor traffic is predominately carried by IPv4.  However, this will change over time. 

Much of the Internet today relies on NAT (“Network Address Translation”). Most home and small-business users have only one IP address on the internet – the one assigned to the router that connects them to their ISP. The router, in turn, issues “internal” IP addresses to the devices that attach to it, but must constantly keep track of which traffic belongs to which device, and translate the IP address from internal to public in order to facilitate communications with the internet. With IPv6, every device can literally have its own unique public IP address with direct connection to the internet. 

The transition from IPv4 to IPv6 results in a substantial expansion of available internet addresses. It is somewhat akin to when the phone company required dialing area codes to reach a local phone number. The transition will be very gradual, however, so current devices using IPv4 will continue to work as long as internet service providers continue to support IPv4.

IPv4 has a maximum limit of 4.3 billion IP addresses (232).  IPv6 has a larger address format that allows for significantly more IP addresses (2128).  Once IPv6 was deployed, that number increased to 340 trillion trillion trillion (that's not a typo)9 addresses. This amounts to 340,282,366,920,938,463,463,374,607,431,768,211,456 unique IP addresses, a rather mind-boggling number.

For perspective, consider the following: if we think of the number of IPv4 addresses as equivalent to the volume of a typical beach ball, then the number of IPv6 addresses would equate to the volume of the sun.

Why IPv6?

With the number of internet-connected devices worldwide today, most of the available IPv4 addresses have been already been assigned. Looking ahead into the new IoT era suggests that each home could easily have dozens of internet-enabled devices, each requiring its own IP address. Gartner predicts that there will be 4.9 billion internet-connected devices in 2015 with a forecasted increase to 25 billion by 2020.10 Such an increase requires the transition from IPv4 to IPv6.  The transition to IPv6 comes with other benefits:

  • Security – Confidentiality, authentication and data integrity are incorporated into IPv6.  It has certain features that keep addresses hidden from would-be criminal hackers.
  • Increased speed – Without the need for a NAT, data throughput speeds for internet-connected device increases. The elimination of the NAT frees-up the processing power of certain devices.
  • Data Routing – There is greater efficiency in how data is routed and transmitted since there is an efficient use of the routing table. A routing table can be viewed as a glorified address book that determines a data packet’s destination. IPv6 reduces the size of routing tables and makes routing more efficient by allowing ISPs to aggregate multiple prefixes of their customer’s networks into a single prefix.  
  • Increased Packet Processing Efficiency – By simplifying the data communication process, packets can be processed more quickly and efficiently.  IPv6 simplifies the packet header compared to IPv4 which makes the processing more efficient.  Also, unlike IPv4, IPv6 has no header checksum process (as this is already contained within IPv6) which eliminates the need to recalculate the checksum at each router hop. A checksum is an error checking mechanism to detect data corruption.   
  • Additional improvements – These can be found in the articles listed in the endnotes 11 and 12.11 12

Businesses Affected

Just about any technology company involved in R&D and manufacturing that somehow touches the internet must pay attention to these standards. These organizations need to ensure their device will communicate correctly with other devices when utilizing the IPv6 protocol. Their products need to take advantage of the benefits provided by IPv6 in order to remain competitive. Manufacturers of networking gear, routers and other telecommunications equipment are some examples of technology businesses directly affected by the transition. Furthermore, software developers and manufacturers of internet-enabled devices (remotely controlled HVAC, home security systems, consumer appliances and others) can also see great value in developing products that work with the IPv6 protocol.

Manufacturers that are not evolving to the new standard will find their products to be technology-obsolete. This could affect the customers’ ability to receive certain content or access and view certain websites. Also, incidents of hacking may rise sharply for those using obsolete devices as attackers focus on the deficiencies of IPv4.


Without the move to IPv6 the U.S. will eventually run out of IPv4 addresses. With the exponential growth in network and internet-connected devices, a larger pool of IP addresses is clearly needed. "IPv6 provides an address space which is sufficient to provide addresses for any conceivable number of individuals, organizations, devices, or network-enabled objects in the foreseeable future (for a number of centuries, at least).”13  In addition, the other benefits of IPv6 such as security, increased speed, and efficiency in data routing and packet processing, will create greater demand for newer products that are IPv6 enabled.  Technological obsolescence will be a driving factor in the adoption of IPv6. 

Don’t panic completely."IPv4 support will not be dropped any time soon, and legacy IPv4 hardware should continue to function well into the future."14 Although this discussion focused on the advent of IPv6, it is important to remember that for now, IPv4 continues to remain the dominant internet protocol. Because of the prevalence and dominance of IPv4, it is likely to coexist with IPv6 for the foreseeable future. 

Want to test your device for IPv6 compatibility? Go here:

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To learn more about how OneBeacon Technology Insurance can help you manage online and other technology risks, please contact Dan Bauman, Vice President of Risk Control for OneBeacon Technology Insurance at or 262.966.2739.


1 Wikipedia, ARPANET, Accessed January 2015,

2 Ibid.

3 Wikipedia, , Accessed January 2015,

Wikipedia, IPv6, Accessed January 2015

5 Fletcher, Jack. “The Internet of Things.” OneBeacon Technology Insurance, November 7, 2013, Accessed January 2015,

6 Internet Society, Who We Are.  Accessed January 2015,

7 Ibid

8 Beal, Vangie. “What is The Difference between IPv6 and IPv4?” Webopedia, January 22, 2014, Accessed January 2015,

9 Captain, Sean. “Internet grows by trillions of addresses, as IPV6 rolls out worldwide.” Tech News Daily, June 6, 2012, Accessed January 2015,

10 “Gartner says 4.9B connected devices will be in use in 2015.” Gartner, November 11, 2014, Accessed January 2015,


12 Rouse, Margaret. “IPv6 (Internet Protocol Version 6).”, Accessed January 2015,

13 “IPv6 – What is it, why is it important, and who is in charge?” ITU (International Telecommunication Union), Accessed January 2015

14 Bradley, Tony “IPv6: Fire Thinks You Should Know.” PCWorld, June 6, 2012, Accessed January 2015,