That's a really neat solution. Does that mean one of the constraints you'd have to impose is that a given customer can only have as many VMs as there are addresses in the block of IPs that you own? If they tried to create another one past that, it seems like you'd have a bit of a problem on your hands - but then again, maybe that number is so high that you're not likely to run into that edge case?

I started reading this thinking 'why not just use different port numbers' but I came away convinced that the problem was worth solving and their solution is neat.