Brazil: The truth about CGNAT in Brazil

General
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After several researches regarding CGNAT in Brazil, I reached a conclusion. Here is below:

There are clear reasons why Brazilian companies still prefer to use IPv4 with CGNAT (Carrier-Grade NAT) instead of migrating to IPv6. I will explain the main reasons:

1. IPv4 Address Shortage

• IPv4 has a limit of 4.3 billion possible IP addresses. This stock has been depleted globally for years. In Brazil, due to the growing demand for internet connections (mobile devices, IoT, etc.), there is a significant shortage of IPv4 addresses.

• Solution with CGNAT: To circumvent the shortage of IPv4 addresses, operators implement CGNAT, a technique that allows multiple clients to share a single public IPv4 address. This saves addresses, but brings performance issues and limitations for users who need specific ports open, such as in the case of blockchain nodes and game servers.

2. Cost and Complexity of Migration to IPv6

• Although IPv6 was created to solve the IPv4 scarcity problem (with 3.4 x 10^38 possible addresses), many companies still hesitate to adopt IPv6 due to:

• Implementation costs: The migration to IPv6 can be complex and expensive. It involves updating network equipment, routers, and legacy systems that still do not support IPv6.

• Compatibility: Many old systems and devices were not designed to support IPv6. The transition may require hardware replacements and software adjustments, which increases the cost and complexity.

3. Lack of Economic and Regulatory Incentives

• In Brazil, there is no regulation that requires operators to migrate to IPv6. Moreover, the majority of residential customers and small businesses do not require IPv6, which means that, for telecommunications companies, the investment in IPv6 infrastructure does not yield an immediate return.

• CGNAT is cheaper in the short term: Maintaining IPv4 with CGNAT is more economical for companies than fully migrating to IPv6.

4. Low Adoption of IPv6 by End Users

• Even though many large services (Google, Facebook, etc.) already support IPv6, most end users still access the internet using IPv4. This creates a cycle of low adoption:

• Low demand: Since few users utilize IPv6, companies do not see urgency in implementing full support for IPv6.

5. Perceived Performance and Security Issues

• Some companies incorrectly believe that IPv6 may introduce security or performance issues, as IPv4 and its protection mechanisms (such as NAT) are more well-known and tested.

• Lack of Knowledge: The absence of knowledge on how to correctly configure and manage IPv6 networks also hinders adoption.

Current Situation and Perspectives

The adoption of IPv6 has been slowly increasing in Brazil, especially among major providers like Claro and TIM, which are already implementing dual-stack support. (IPv4 e IPv6). However, for smaller providers and some regions, the use of IPv4 with CGNAT is still the norm.

The transition to IPv6 is inevitable, but it may take time for all providers to widely adopt the technology. Some steps that could accelerate this include:
Regulation: Incentives or regulations that require IPv6 support.

Education: Increase in training and knowledge about IPv6 among network administrators.

Market pressure: With the increase in IoT devices and the demand for more simultaneous connections, the pressure to adopt IPv6 may grow.

3 Likes
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Excellent work! Your clear approach to the challenges faced by operators with CGNAT and IPv6 makes it easier to understand for those outside the industry. It’s both educational and accessible. something many discussions on network infrastructure often overlook.

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Nice writeup @BorealisSaile - very clear and it is unfortunately the situation. This puts inbound connections at the mercy of the ISP.

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Addition on IPv6 - Anatel Action Plan

I would like to add a relevant update regarding IPv6, especially in Brazil. In October 2024, the Anatel Board of Directors approved an Action Plan to expand the use of the IPv6 protocol in telecommunications networks in Brazil. With an adoption rate of about 50%, Brazil is the second-largest user of IPv6 in Latin America, behind only Uruguay. The proposal focuses on modernizing and securing the country’s digital infrastructure.

However, Brazil still faces stagnation in adoption, especially among smaller providers. Anatel proposed, among other actions, the diagnosis and promotion of IPv6 adoption by these providers, as well as strengthening IPv6 support in telecommunications equipment through certification.

Although the plan has been approved, bureaucracy in Brazil could represent a significant challenge. Many practical details, such as the need to coordinate actions between smaller providers and ensure devices and platforms are IPv6-ready, may take time to implement effectively. As often happens in Brazil, the success of the implementation will depend not only on the approval of policies but on concrete initiatives that must be driven and monitored by various regulatory entities.

In my opinion, the real impact of this plan will only be felt when there is active mobilization and faster action from Anatel and service providers, ensuring that the IPv6 protocol is adopted on a large scale, alongside industry awareness of the benefits of a more secure and efficient network.

Anatel Action Plan - Summary:

  • Adoption of IPv6 is a critical step to ensure Brazil’s networks meet future technological needs.

  • The country is the second-largest user of IPv6 in Latin America (50% adoption), but still faces implementation challenges.

  • Anatel approved a plan to encourage adoption, especially among small providers and content providers.

  • The GT-IPv6 will be reactivated to monitor and drive these changes, with a focus on security and modernizing the digital infrastructure.

Source: Plano de ação para ampliação do uso do IPv6 é aprovado pela Anatel — Agência Nacional de Telecomunicações