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Jason Levine
Premium
join:2001-07-13
USA
reply to IowaCowboy

Re: Why should Netflix undercut cable

Completely the store owner's call. Just like if Netflix decided, for some reason, "we're not allowing Comcast customers to access Netflix." The point is, though, that he *can* accept orders from people using other phone companies even though he isn't paying those other companies anything. He pays his phone company and the customers pay their phone company. The two phone companies work out among themselves how they handle calls passing between them.

Netflix does the same thing. They pay their ISP, their customers pay their ISPs and the ISPs work out how traffic passes between them. If you needed to pay every ISP for your website to be viewable on their network, running a simple web page would be too expensive for your average person.
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-Jason Levine