Earlier this week Level3, who recently
re-obtained Netflix streaming traffic, triggered a small technology news firestorm by somewhat falsely proclaiming that Comcast was
demanding they pay a new toll to deliver video content to Comcast customers. As the day wore on, Comcast attempted to defuse the situation by proclaiming this was little more than the kind of peering disputes
we've been seeing for years, where tier one operators bicker over the balanced (or unbalanced) exchange of core network traffic. The resulting cacophany was par for the neutrality course and quickly teetered into ridiculous territory.
Consumer advocates declared it the end of the world, using Level3's behavior as ammunition in efforts to stop the NBC merger. Paid industry fauxcademics -- such as Digital Society (AT&T funded)'s George Ou -- quickly trotted out their false but persistent "free ride"
bogeymen, proclaiming that Level3 was a bandwidth thief. Fortunately Nate Anderson at
Ars Technica did one of the better jobs we've seen dissecting the issue, noting that Comcast's claim is unique in that they're the first last-mile ISP to pretend they deserve additional payment for carrying Level3 traffic:
...the CDN traffic from Level 3 isn't in "transit" anywhere; it's going to the Comcast customers who want to watch Netflix movies. Level 3 is, in one sense, doing Comcast a favor by making a key Internet service better; it's not simply taking advantage of Comcast's network to get its own traffic somewhere else...Comcast has a lock on its customers and can try to extract rents from anyone trying to send them data, even if it's data they requested.
Stacey Higginbotham also offers a
grounded explanation over at GigaOM, noting that Comcast using its massive subscriber base as leverage to exert additional costs on network operators does raise competitive concerns:
Peering is the face of this issue — the idea that Internet Service Provider A allow traffic from similarly sized and loaded networks to traverse its own for free because ISP A‘s traffic gets a pass when it’s on networks owned by ISP B or ISP C. However, the soul of this issue is how it exposes how uncompetitive the nation’s broadband networks really are. The very threat that Level 3 alleges Comcast made — essentially that Level 3 could accept the proposed fee or Comcast wouldn’t deliver Level 3′s content — should lead to concern.
Major technology outlets like CNET
bought the idea that this was just another peering feud, but there is something entirely new at play here. The idea that Comcast would try and jack up Level3 (and subsequently Netflix's) costs just as Level3 re-obtains Netflix streaming traffic certainly sounds like the Comcast we know. Such behavior is only made possible by Comcast's mammoth (and soon to be larger with NBC's addition) size and uncompetitive markets. The FCC is
said to be investigating the feud which could lead to more much-needed detail, but as with retransmission fights, it seems unlikely they'll actually bother to intervene, and most of the real financial details behind this fight very well may remain obscured.
Update: Some additional interesting claims have surfaced on
the NANOG mailing list:
I don't know about their connection to TWT, but Comcast has definitely been running their transits congested. The most obvious one from recent months is Tata, which appears to be massively congested for upwards of 12 hours a day in some locations. Comcast has been forcing traffic from large networks who refuse to peer with them (e.g. Abovenet, NTT, Telia, XO, etc) to route via their congested Tata transit for a few months now, their Level3 transit is actually one of the last uncongested providers that they have.
The part that I find most interesting about this current debacle is how Comcast has managed to convince people that this is a peering dispute, when in reality Comcast and Level3 have never been peers of any kind. Comcast is a FULL TRANSIT CUSTOMER of Level3, not even a paid peer. This is no different than a Comcast customer refusing to pay their cable modem bill because Comcast "sent them too much traffic" (i.e. the traffic that they requested), and then demanding that Comcast pay them instead. Comcast is essentially abusing it's (in many cases captive) customers to extort other networks into paying them if they want uncongested access.
:Comcast's
filing with the FCC (pdf) proclaims that the company
is a full peering partner, and that Level3 is "disingenuous," and trying to get something for nothing:
But Level 3 is trying to game the process of peering – one that has worked well and consensually, without government interference, for over a decade – in order to gain a unique and unfair advantage for its own expanding CDN service. Level 3’s problem apparently arises out of the fact that it recently won a bid to become one of Netflix’s primary CDN providers – in competition with the major national CDNs that already send Netflix and other traffic to Comcast’s network. In order to undercut its CDN competitors, Level 3 wants to avoid the commercial arrangements other CDN companies use to terminate traffic onto Comcast’s and other providers’ networks, and instead force Comcast to accept its CDN traffic for free, under a “peering” relationship. This is not how peering works, here or anywhere in the world. What Level 3 is suddenly pushing – a “new theory” of peering –would throw the traditional, "balanced traffic" peering rulebook out the window, give Level 3 an unfair cost advantage over its competitors, and shift all the costs from Level3 and its content customers on to Comcast and its high speed Internet customers..."
