Just a few years ago Netflix's botched DVD rental business split
and significant price hikes
resulted in numerous analysts proclaiming the company was dead. Netflix's earnings
yesterday suggested anything but -- the company announcing they'd added 1.7 million subscribers on the quarter and ended 2013 with over 44 million subscribers. Needless to say, most of the analysts who predicted Netflix's demise have been pretty quiet lately.
On a different subject, in a letter to investors
(pdf) Reed Hastings touched on Verizon's recent neutrality court victory over the FCC's net neutrality rules
, warning ISPs that if they start degrading video quality anti-competitively or imposing new troll tolls, Netflix will galvanize its userbase to publicly rise up against the carriers.
"In principle, a domestic ISP now can legally impede the video streams that members request from Netflix, degrading the experience we jointly provide..the motivation could be to get Netflix to pay fees to stop this degradation," notes Hastings. "Were this draconian scenario to unfold with some ISP, we would vigorously protest and encourage our members to demand the open Internet they are paying their ISP to deliver."
ISPs, Hastings notes, are "generally aware of the broad public support for net neutrality and don’t want to galvanize government action."
As I've noted
recently, most ISPs aren't going to outright start blocking websites or content for just that reason. However, instead they've been engaged in more subtle abuses of gatekeeper power, whether it's Verizon's obnoxious lock down of competing products and services
using bogus-techno-justifications, or AT&T's imposition of their new "sponsored data" effort
that would heavily favor content companies with the deepest pockets.
AT&T's Sponsored Data is a good example of the kind of ideas ISPs could push forth that might not entirely bother deeper-pocketed companies like Netflix, or an FCC run by a former cable and wireless lobbyist, but could be bad for consumers and smaller companies all the same.