it won't be news to most of you techies that ARP data from 172.16.0.0/12 leaks out of the Motorola cable modems on Telstra's network. I've always been happy to ignore this but a friend of mine told me an interesting story last night.
He recently replaced a dying linksys router with a 3com Office Connect one, very nice router. A couple of days later Telstra shut down his modem and refused to start his service again until he changed his local area network's IP addresses and subnet. He was using the RFC1918-defined private network address space of 172.16.0.0/12 also. So it would seem that the 3com router was smarter than the Linksys and seeing ARP data on it's external/WAN interface decided to proxy ARP between networks.
Spurious ARP data being allowed to enter private networks is a slight concern but the fact that his ARP data was allowed to enter and cause problems in the TCL network is a major concern. People could be poisioning Telstra's cache's and potentially sniffing other people's Internet connections, switched ethernet networks still are vulnerable and I'd like to know what Telstra's excuse for this huge vulnerability is.