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Netflix Sends ISPs a Warning on Net Neutrality
by Karl Bode 12:37PM Thursday Jan 23 2014
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.


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65194623

join:2014-01-14

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reply to elray

Re: Who's pockets are deeper?

said by elray:

With apologies to Justin, BBR doesn't create an undue traffic burden.

Netflix does.

Using your Internet connection which you paid for is an undue burden? Seriously? Is that how screwed up North America has become? Using services you paid for and you're evil scum? Seriously twisted and screwed up.

rradina

join:2000-08-08
Chesterfield, MO

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reply to Hall

Re: Modus Operandi

Perhaps a Comcast Snowden will step forward?


newview
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reply to tshirt
Comcast has already settled a lawsuit with the FCC for $800,000 for failure to follow certain conditions of the NBC merger agreement. They were less than diligent to "visibly offer and actively market" standalone broadband internet access. I suspect (though of course cannot prove) that Comcast is also dragging it's feet complying, or actively avoiding, other aspects of the agreement, especially those that benefit Comcast and cannot be proven unless you have inside knowledge.

As far as pricing polices goes, in my area, Comcast offers 10 ... yes that's 10 channels for $14.75. This laughable offer doesn't even meet their own criteria for the $15.00 discount. There is just no comparison between this offer and the $7.99 a month Netflix, even when they increase the price. Hell, even if they doubled the price it would be a better value than Comcast.

Netflix wants to introduce three pricing tiers for new members
»gigaom.com/2014/01/22/netflix-wa···-months/


newview
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quote:
"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."
Step one is already happening, and has been for some time. I spoke at length to a Netflix CSR rep just two days ago and he described the Comcast throttling issue policy as "common knowledge".