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Netflix Strikes Interconnection Deal With Verizon
by Karl Bode 08:54AM Tuesday Apr 29 2014 Tipped by promisic See Profile
Just days after warning that giant ISPs will use interconnection deals to force content companies to pay higher and higher rates to access their customers if they want decent network performance, Netflix has announced that the company has struck an interconnection deal with Verizon. Details are limited as there's no official announcement, but the deal mirrors the one Netflix struck with Comcast back in February, bypassing core network carriers like Cogent, and instead directly connecting to the last-mile ISP network.

Netflix states they've been forced to strike these deals as large ISPs have allowed peering points with transit operators to deteriorate in a gambit to eliminate settlement free peering from the market and drive up connectivity costs. In a blog post, Netflix recently complained that these deals don't replace core transit relationships, and they effectively are "double dipping":
quote:
In sum, Comcast is not charging Netflix for transit service. It is charging Netflix for access to its subscribers. Comcast also charges its subscribers for access to Internet content providers like Netflix. In this way, Comcast is double dipping by getting both its subscribers and Internet content providers to pay for access to each other.
Still, Netflix chose to pay anyway, and Verizon customers should soon finally start seeing an improvement in Netflix streaming performance, just as Comcast users did earlier this month. Walter Piecyk, an analyst at BTIG research, was the first to report the deal via Twitter. No financial or technical details of the two companies' new deal were revealed.


121 comments .. click to read

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nekkidtruth
YISMM
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London, ON
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reply to serge87

Re: Good

How exactly is Netflix acting like a "high school drama queen" by not wanting ISP's to interfere with the connection between themselves and their customer?

NO ISP should be doing that. That's the whole purpose of net neutrality. Your ISP should be providing you with a connection to the Internet and nothing more.
--
Weeeeeee

qworster

join:2001-11-25
Bryn Mawr, PA

3 recommendations

It's well past time...

It's well past time for the Internet to become what it already is: A PUBLIC UTILITY! It is WRONG for the Internet to be controlled geographically by a few big companies.

serge87

join:2009-11-29
Reviews:
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reply to tshirt

Re: Good

said by tshirt:

said by serge87:

And it's about damn time...I was beginning to wonder what was taking Netflix so long

It's a 2 way street, both sides have to find terms they can live with.

Agreed. Netflix shouldn't act like a b!tchy high school drama queen expecting everything for free but Verizon also cannot exploit their unique position to extort outrageous amounts from content providers like Netflix. A FAIR price peering agreement is the best solution in this situation.

rebus9

join:2002-03-26
Tampa Bay
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1 edit

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reply to Mr Guy

Re: What Suffers at Netflix's Improvement?

said by Mr Guy :

if Cogent wasn't the Dollar Store of ISPs Netflix wouldn't have to do this. Maybe Cogent gets off it's ass and beef up it's infrastructure now.

(Mod EDIT: please be polite).

Are you friggin' serious???

This has ABSOLUTELY NOTHING to do with Cogent's infrastructure. They were ready, willing, and able-- BEGGING Verizon to JOIN THEM in upgrading the interconnection. Cogent even OFFERED TO PAY VERIZON'S EQUIPMENT COSTS TO UPGRADE. Cogent has MORE than enough capacity and they are ALWAYS willing to upgrade peering whenever it's needed.

VERIZON was the one refusing to upgrade peering. VERIZON, VERIZON, VERIZON.

Verizon is the bad guy in this whole mess. Not Cogent.

Get your facts straight.


buzz_4_20

join:2003-09-20
Limestone, ME

4 recommendations

reply to mackey
The problem wasn't being able to handle the bandwidth.
The problem was not enough connections at peering locations - due to business issues, not technical issues.


Mike
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join:2000-09-17
Pittsburgh, PA
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3 recommendations

Quadrupal dipping

Customers get a bill for Verizon.
Verizon bills Netflix twice. One for network access and then faster access.
Plus they're taking government handouts to build out the network and not delivering.

I need to start me a Verizon.
--
"If something about the human body disgusts you, complain to the manufacturer" - Lenny Bruce
What this country needs is a good five dollar plasma weapon.

rebus9

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reply to guppy_fish

Re: Bottom Feeders only the ones that lose

said by guppy_fish:

Won't cost Netflix a thing

What ???!!!

You've clearly never bought Verizon transit or peering. There is no way Netflix is paying Verizon anywhere near Cogent prices, so this WILL cost Netflix more which will eventually translate into Netflix rate increases for the rest of us. Verizon is one of the most expensive carriers going. Few carriers are priced as high as Verizon (who is right up there with AT&T).

(I'm referring specifically to carrier transit and peering, NOT home/soho internet connections.)

elefante72

join:2010-12-03
East Amherst, NY

4 recommendations

reply to Mr Guy

Re: What Suffers at Netflix's Improvement?

Cogent wasn't the only transit provider Netflix was using. My stuff would transit mostly through Level3.

And it wasn't the infrastructure, it was the transit jump points connection to VBS/CMCSA which Verizon/Comcast would let saturate on PURPOSE. The remedy would be adding a $100 fiber cable between the two routers. Yes that is what was causing millions to suffer.

So now Verizon and Comcast are enjoying those transit fees instead to the tune of millions. So now they can magically afford to put that $100 cable in.

Rekrul

join:2007-04-21
Milford, CT

4 recommendations

reply to guppy_fish

Re: Bottom Feeders only the ones that lose

said by guppy_fish:

Won't cost Netflix a thing, customers are happy and finally the gamers will be happy as there bottom feeding sites can get some bits moved with Nexflix traffic moved

You think yearly rate increases won't apply to companies like Netflix? Every year, Comcast and Verizon will jack up the cost until Netflix is paying double or triple what they are now. First they eliminate the middlemen, then once they have netflix locked in to their connection arrangement, they'll turn the screws. They'll bleed Netflix dry if given the chance. Netflix will be forced to raise their prices to cover the rising costs of these agreements.


nothing00

join:2001-06-10
Centereach, NY

1 edit

3 recommendations

reply to guppy_fish

Bottom feeders are winning

Comcast and Verizon are winning the round to have everyone else pay their costs and pad their profits. Such low life bottom feeders, if they'd only have provided the service that they were contracted to by their customers.

What's the point of "bandwidth packages" to the "Internet" if you're not getting "Internet access"? What really matters is whether or not the web site has paid Comcast/Verizon.

Downgrade your ISP package to something your ISP can deliver. Kick 'em to the curb.