The IT Manager of a University in the UK complained of problems with the Network switches reporting high CPU usage and packet loss. This is typically a sign of to much broadcast traffic hitting the CPU.
Fabian in the USA Office was able to advise:
This was caused by a process in the router called Proxy ARP. The router responded to all link local address ARP with its own MAC address.
The camera is looking for an open link local address by sending an ARP request to see if the IP is open. The router responds to the ARP request so the camera thinks this address is in use and then tries another address until it runs out of addresses.
I had to disable proxy ARP for all connections in my Cisco router.
This indeed solved the problem with the University.