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Cable Companies: We're Afraid Netflix Will Demand Payment From ISPs 200

Dega704 (1454673) writes While the network neutrality debate has focused primarily on whether ISPs should be able to charge companies like Netflix for faster access to consumers, cable companies are now arguing that it's really Netflix who holds the market power to charge them. This argument popped up in comments submitted to the FCC by Time Warner Cable and industry groups that represent cable companies. (National Journal writer Brendan Sasso pointed this out.) The National Cable & Telecommunications Association (NCTA), which represents many companies including Comcast, Time Warner Cable, Cablevision, Cox, and Charter wrote to the FCC:

"Even if broadband providers had an incentive to degrade their customers' online experience in some circumstances, they have no practical ability to act on such an incentive. Today's Internet ecosystem is dominated by a number of "hyper-giants" with growing power over key aspects of the Internet experience—including Google in search, Netflix and Google (YouTube) in online video, Amazon and eBay in e-commerce, and Facebook in social media. If a broadband provider were to approach one of these hyper-giants and threaten to block or degrade access to its site if it refused to pay a significant fee, such a strategy almost certainly would be self-defeating, in light of the immediately hostile reaction of consumers to such conduct. Indeed, it is more likely that these large edge providers would seek to extract payment from ISPs for delivery of video over last-mile networks."
Related: an article at Gizmodo explains that it takes surprisingly little hardware to replicate (at least most of) Netflix's current online catalog in a local data center.
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Cable Companies: We're Afraid Netflix Will Demand Payment From ISPs

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  • What? (Score:1, Insightful)

    by NitWit005 ( 1717412 ) on Friday July 25, 2014 @10:23PM (#47536361)
    What part of that suggests they're afraid Netflix will threaten them?
  • Re:What? (Score:4, Insightful)

    by russotto ( 537200 ) on Friday July 25, 2014 @10:27PM (#47536387) Journal

    Right in TFS: "Indeed, it is more likely that these large edge providers would seek to extract payment from ISPs for delivery of video over last-mile networks."

  • by forand ( 530402 ) on Friday July 25, 2014 @10:31PM (#47536403) Homepage
    This might be reasonable if it was coming from a group who hadn't spent huge sums of money fighting to stop legislation that would have made it illegal for either netflix or comcast to charge for the specific route. That being said if Comcast, Time Warner, etc. make Netflix pay to be inside their networks now and in the future Netflix turns around and says "if you don't pay us to stay we will remove our servers from your networks and your customers will have to get Netflix through standard routing" then I have no sympathy for them but they may be right in worrying.
  • Re:What? (Score:5, Insightful)

    by Travis Mansbridge ( 830557 ) on Friday July 25, 2014 @10:32PM (#47536407)
    The Telecommunications association seems to have forgotten how telecommunication works.. not to mention the meaning of the word "indeed"
  • Boohoo? (Score:2, Insightful)

    by Anonymous Coward on Friday July 25, 2014 @10:40PM (#47536431)

    Companies that are virtual monopolies (south park pointed this out) exist in local areas. I can drop netflix and get hulu, or whatever, no matter where i am. But if verizon is the only place that has dsl in my town, or a cable co dominates the market in a city and the dsl is a joke by comparison, i'm fucked. period. netlix can ask for money, perhaps. But comcast for example can simply unflap its nipple-cover and rub that shit raw, because there is no actual competition for real reals. any competitor can offer online video streaming, and there are a whole bunch i can choose from. i happen to have netflix, but i also use hulu and other services too. i pay for what i use and i'm fine with it. But when it comes to ISP choice, i have 2 choices. dsl that is barely enough to have one stream coming in, or one other option that is way more expensive. i choose the expensive one because a: i'm a nerd, and b: throwing another 100 dollars a month at dishnetwork or whoever seems like a huge waste of money :)

  • Re:not likely (Score:5, Insightful)

    by TClevenger ( 252206 ) on Friday July 25, 2014 @10:43PM (#47536437)

    They are dreaming. We are thinking about throttling them here right now. Why should we let all those other sites suffer due to one service using nearly 75% of our bandwidth.

    Customers are DEMANDING those bits. If you can't afford to keep those bits flowing, start charging your customers more.

  • by Karmashock ( 2415832 ) on Friday July 25, 2014 @10:57PM (#47536491)

    you've had all the advantages to do it for years... any of the major cable companies has a huge advantage if they wanted to release a video on demand service.

    but you're so determined to suck off the TV model that you've crippled yourself.

    And now you're paying the price.

  • Such lies ... (Score:4, Insightful)

    by gstoddart ( 321705 ) on Friday July 25, 2014 @10:59PM (#47536497) Homepage

    If a broadband provider were to approach one of these hyper-giants and threaten to block or degrade access to its site if it refused to pay a significant fee, such a strategy almost certainly would be self-defeating, in light of the immediately hostile reaction of consumers to such conduct

    Translation: We'd do this to a small company in a heartbeat, and we're really disappointed we didn't kill net neutrality before there were enough big players to fight us on this. Unfortunately we have to make ourselves out as the victims, again.

    These guys will do anything to keep their monopolies, and want to be sure they can do anything they want to milk customers.

    As usual, this is lobbyists and lawyers and PR people making their clients out to be the poor downtrodden victim here.

    And, of course, the FCC being totally sympathetic to the plight of these poor, downtrodden monopolies, I'll be surprised if they don't give it to them.

  • Re:What? (Score:5, Insightful)

    by Jarik C-Bol ( 894741 ) on Friday July 25, 2014 @11:10PM (#47536551)
    Yeah, i don't see how their supposed 'netflix is going to extort us' scare is supposed to work. Everything I remember about how the internet works pretty much invalidates the idea.
  • Re:not likely (Score:5, Insightful)

    by Eristone ( 146133 ) * <> on Friday July 25, 2014 @11:11PM (#47536561) Homepage

    I must be missing something - you are unable to provide the bandwidth you advertise to your end users and you are complaining that the companies they are requesting data from are at fault? This is the same as saying that the concert at the stadium is at fault for the traffic backups. Wouldn't the fault be more with the road providers? Especially when the concert people are saying "Hmm, we know this is possibly a problem - we can put a live hologram local to your people so they don't have to get on your roads" and instead of saying "yes", you say "no, it's all your fault we can't provide it". Your end-users are your customer - and should you start throttling because you're unwilling (or unable) to provide the bandwidth, they are well within their rights to nail you to the wall for failing to provide SLA data throughput if it is correctable by you.

  • Re:not likely (Score:5, Insightful)

    by BitZtream ( 692029 ) on Friday July 25, 2014 @11:41PM (#47536675)

    Other customers are demanding other bits and they don't wan't to pay more to feed others hunger for back to back streams of game of thrones.

    Thats your problem. You over sold service and can't provide what you sold.

    Its a poorly designed system and its not the isp's at fault its the netflix don't understand how to do things efficiently.

    Actually they do, which is why they'll colo a rack for you for free, or peer with you at any major pop, for free.

    The poor design is yours. You're just a shitty ISP.

    it uses almost as much bandwidth as our customers use. Thats straight from netflix. Its crap on top of crap with them.

    Bullshit. Its a local cache, exactly what you were demanding they do originally. You're clueless.

  • by nadaou ( 535365 ) on Saturday July 26, 2014 @12:06AM (#47536745) Homepage

    Reminds me of the stories of panhandlers begging at intersections
    who get picked up by their chauffeurs at the end of the day to go back
    to their mansions.

    You mean complete imaginary bullshit made up by and propagated by greedy
    sociopaths eager to rationalize their abandonment of their fellow man?

    Yeah, something reminiscent in it.

  • Re:What? (Score:5, Insightful)

    by BitZtream ( 692029 ) on Saturday July 26, 2014 @01:06AM (#47536905)

    Disney, ESPN, CNN all charge customers directly on the Internet, as does netflix.

    If they started charging comcast/timewarner/cox/whoever for Internet services they would be double dipping. This cost would certainly be passed on to users who would be unhappy to be paying twice for the same service.

    Facebook charging an ISP would also be passed on to the customers, at which point customers would protest. No one will knowingly part with money for Facebook. They'll stop using it before paying for it (knowingly). They'll pay for it by giving Facebook their data and tons of ads, but parting with cash so you can see someones dog chase its talk or lolcats not so much.

  • Re:What? (Score:4, Insightful)

    by pete6677 ( 681676 ) on Saturday July 26, 2014 @01:25AM (#47536949)

    Now that Comcast will soon be the nation's only cable company, why don't they just tell the networks they will no longer pay for their channels once the current contract is up? What are the networks going to do, lose nearly all of their viewers overnight?

  • Re:What? (Score:4, Insightful)

    by erroneus ( 253617 ) on Saturday July 26, 2014 @01:32AM (#47536967) Homepage

    What the ISPs are ACTUALLY afraid of is popular businesses like NetFlix doing what many other content providers have done when presented with higher costs of market participation have done. They simply stop providing content and let their consumers influence the carriers. It's the content providers who provide value to the carriers, not the other way around. And that fact becomes exceedingly clear when content providers push back by pulling out and fans/consumers get upset.

    Can you imagine what would happen to even the most powerful ISP if NetFlix refused to send packets to endpoints controlled by such an ISP? Where do you think the consumer outrage would be focused? On NetFlix or the carrier? History suggests the outrage goes to the carrier who threatens and charges the content providers for the priviledge of connecting with consumers.

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