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Businesses The Almighty Buck The Internet

Netflix CEO Says Net Neutrality Is 'Not Our Primary Battle' (theverge.com) 128

Speaking with Recode's Peter Kafka at the Code Conference today, Netflix CEO Reed Hastings explained his position on the current net neutrality debate that's happening at the FCC. Or, more to the point, he addressed the fact that he's been awfully quiet about it compared to how loudly he defended net neutrality in previous fights. From a report: "It's not narrowly important to us because we're big enough to get the deals we want," Hastings said. It was a candid admission: no matter what the FCC decides to do with Title II, Netflix isn't worried about its ability to survive. Hastings says that Netflix is "weighing in against" changing the current rules, but that "it's not our primary battle at this point" and "we don't have a special vulnerability to it." He does believe that smaller players are going to be harmed if net neutrality goes away, saying that "where net neutrality is really important is the Netflix of 10 years ago."
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Netflix CEO Says Net Neutrality Is 'Not Our Primary Battle'

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  • by HumanWiki ( 4493803 ) on Wednesday May 31, 2017 @03:43PM (#54520715)

    Yeah, that type of commentary is why people have serious issues with companies throwing their weight around whenever it suits them.

    • Re: (Score:3, Insightful)

      They are just being honest. There is nothing inherently wrong with a large company using its size to get a better deal.
      • by Anonymous Coward

        read their new stance as saying:

        we're big enough it doesn't matter to us anymore.. we really don't give one shit about our customers, other than that they remain our customers.. and new toll roads on the internet will keep startups from taking them away from us.

        • by Anonymous Coward

          You're misreading it. The message is to their shareholders, saying "don't worry, this won't affect us financially", because it looks like this administration is going to get rid of net neutrality and they don't want it to affect their stock price.

      • They are just being honest. There is nothing inherently wrong with a large company using its size to get a better deal.

        My issue is with the underlying thought process at work. This time it's a better deal. What about next time? It's a slippery slope to encourage that type of behavior because at some point, they'll use it against you/us.

      • by hey! ( 33014 )

        Well, there sometimes *is* something wrong, which is why we have anti-trust laws, and why we need net neutrality. But if the government says that ISPs are allowed act like feudal barons, then using your size is what you have to do.

      • There is nothing inherently wrong with a large company using its size to get a better deal. Reply to This

        No but there is a problem with changing the way the internet works so only large companies can use their size to get better deals. Netflix using their size to get TV shows like Brooklyn Nine-Nine over say Crackle is one thing. Netflix using their size to not care that websites like Crackle are downspun and now operate at a crawl while they remain unaffected is completely not ok. That would be like if the

    • by mysidia ( 191772 )

      It's all hubris. The major broadband carriers Don't care if Netflix thinks they've got theirs.
      Once net neutrality is gone, they can push their own service --- unleash the rate limiting - service will degrade,
      and people will be incentivized to switch to their carrier's streaming service.

      • by ezdiy ( 2717051 )

        people will be incentivized to switch to their carrier's streaming service

        No, people will be incentivized to seek less shitty carrier all that more and netflix will throw their weight as a counter.

        This is because both titans use their customers as ammution, and netflix simply got more. If comcast depeers Netflix (and amazon, for that matter), too many people who *do* have a choice of ISP will switch away from comcast at this point making such a step extremely risk for comcast.

        • by necro81 ( 917438 )

          too many people who *do* have a choice of ISP

          And this is the problem with the natural monopoly that has developed, and the reason why Net Neutrality is needed. Most people in the United States don't have a choice of ISP. They couldn't vote with their wallets if they wanted to, except to opt out of the internet entirely.

        • by mysidia ( 191772 )


          This is because both titans use their customers as ammution, and netflix simply got more. If comcast depeers Netflix

          No problem; They can profile their customers and roll the rate-limits out gradually in concert with other providers, concentrating on customers outside of DSL range first. MOST cable internet users don't have a reasonable alternative.

          • by ezdiy ( 2717051 )

            This is because both titans use their customers as ammution, and netflix simply got more. If comcast depeers Netflix

            No problem; They can profile their customers and roll the rate-limits out gradually in concert with other providers, concentrating on customers outside of DSL range first. MOST cable internet users don't have a reasonable alternative.

            The problem with cat and mouse like this (and when titans clash) is that the effect of throttling netflix merely doesn't affect netflix. You have to throttle all - Google, Amazon and Microsoft ASes NetFlix routinely uses for fronting (they do that both defensively, mostly in US, and offensively, often in europe). Whereas land carriers would have to amass unfathomable cooperation between themselves to pull off the same effect.

            Throttling netflix basically means making dozen of mainstream internet services

    • by swb ( 14022 )

      I'd rather have corporate guys say this kind of thing than to bullshit me with other lies or bullshit.

      • Yeah, what else do you want them to do?

        As a public company, there is a limit to how much resources they can throw into advocating something purely for altruistic reasons. They are right that they are big enough that this isn't a problem for them. They can pay for peering agreements, and if ISPs mistreat their customers, then ISPs will have a lot of angry customers. Furthermore, at this point, if the ISPs got rid of net neutrality and turned around and screwed netflix, it would probably quickly change a

    • I can see how they might think that, but coordinated action among the few big ISPs in the US could convince them to think differently...

    • by nomadic ( 141991 )

      If Netflix was now pushing to abolish net neutrality in order to use its size to keep new competitors away, that I would have a moral problem with. This just isn't that objectionable.

    • by guises ( 2423402 )
      This is the best we could have hoped for, short of Netflix dedicating a lot of resources to fight this. He comes right out and says that killing Net Neutrality hurts small players and favors large companies. This is exactly what it does, and it certainly helps to have someone in his position spell it out in such plain language.
    • Exactly

      "It's not narrowly important to us because we're big enough to get the deals we want,"

      Yeah Free Speech isn't important to me. I can say whatever I want. Sufferage isn't important to me I can vote for whomever I want. Right to freely assemble isn't important to me I can hang with my friends whenever and wherever I want. Right to proper representation isn't important to me i can afford my own lawyers.

      When we talk about corporations "being evil" this is what we're talking about. This right here is Netfl

    • It'll be their problem when people stop paying for the premium pipe to them.
  • Kudos on his honesty (Score:5, Informative)

    by Captain Splendid ( 673276 ) <`capsplendid' `at' `gmail.com'> on Wednesday May 31, 2017 @03:44PM (#54520723) Homepage Journal
    "Fuck you, we got ours!"
    • by nyet ( 19118 )

      You mean "Fuck you, we are big enough that net neutrality would hurt us now."

      • by srmalloy ( 263556 ) on Wednesday May 31, 2017 @04:07PM (#54520891) Homepage

        More accurately, "Fuck you, we are big enough that net neutrality would hurt us by making competition easier."

        • Re: (Score:2, Insightful)

          by Anonymous Coward

          This guy gets it. Established companies very rarely mind when there is a barrier to enter.

        • by necro81 ( 917438 )

          "Fuck you, we got ours!"

          You mean "Fuck you, we are big enough that net neutrality would hurt us now."

          More accurately, "Fuck you, we are big enough that net neutrality would hurt us by making competition easier."

          Let's just summarize: "fuck you"

  • If (and it IS still an if) net neutrality is removed, I am going to laugh my ass off when the backbone providers tell Netflix that BECAUSE they are so big, they can pay out their ass.

    I do appreciate the CEO being honest, but he is not thinking about the big picture. He may think that Netflix can handle the extra payola that will be required, but with that kind of hubris, I don't think he has really thought it all the way through.

    • by Anonymous Coward

      You got that backwards. Netflix is so big that a ISP that does not provide access to Neflix will be without customers.

      • by r_naked ( 150044 ) on Wednesday May 31, 2017 @04:09PM (#54520905) Homepage

        You got that backwards. Netflix is so big that a ISP that does not provide access to Neflix will be without customers.

        I don't know about where you live, but I have exactly *one* choice for high speed Internet where I live. I am sure I could get ADSL -- maybe even 3mbits, but I don't think I will be streaming Netflix on that.

        So if my ISP doesn't want to pay the "Netflix carriage charge" to the backbone provider that they use, Netflix is thrown back to the "buffering 90s", and I drop Netflix -- not my ISP -- because I have NO CHOICE.

        Wait, I do have a choice, I could move. Yea, that is a realistic choice.....

        Better hope that congress has some common sense, and when the FCC tries to show that there has been a drastic enough change to warrant the removal of title II status that they laugh in Ajit's face.

        • You do know that netflix has peering servers at most ISP's already. So for many customers you are only going over the ISP's routers before it even goes across the backbone providers like level3 etc..

          So hes right they are big enough to get around that.

          • You do know that even telco providers keep trying to develop competitive options to Netflix, and could throttle the hell out of the routes to those peering servers if they managed to roll one out? (full disclosure, I worked for a major telco for 15 years. They were testing solutions for becoming your tv company for 10 of those years. Also, that company's pack was DEAD SET AGAINST net neutrality because of it.) And don't even get me started on Comcast, which told Netflix to go shove their peering servers.
            • You do know that even telco providers keep trying to develop competitive options to Netflix, and could throttle the hell out of the routes to those peering servers if they managed to roll one out?

              True, but again, Netflix's size keeps them safe. Since approximately 100% of their customers subscribe to Netflix, and since their customers like Netflix a lot more than the telcos, making Netflix service bad has huge potential to backfire. If they want to guarantee that strong Net Neutrality legislation gets passed, making Netflix suck would be an excellent way to accomplish it.

        • by thule ( 9041 )

          I don't know about where you live, but I have exactly *one* choice for high speed Internet where I live. I am sure I could get ADSL -- maybe even 3mbits, but I don't think I will be streaming Netflix on that.

          You have exactly one choice that you're willing to pay for. I'm sure there are more options, but they could be a lot more money. In order of cost you probably have, dialup, cable/DOCSIS, DSL, WISP, satellite, cellular LTE, 2Base-TL (a cheaper form of metro Ethernet via copper pairs), T1/T3, metro Ethernet (via the cable company, but you can choose your transit. Also, construction cost).

          If there is no WISP, why not build one?

          • by r_naked ( 150044 )

            Well hell, I might as well call up Verizon (or Frontier, if the dark fiber was part of the deal), and buy some fiber. I work for a telco that has peering agreements with L3 and Centurylink, and it just so happens I could have them light it up all the way from the front of my house to the front of our data center.

            But wait, just like I don't have money to start a WISP, I don't have money to pay for that fiber (I am sure my employer would have no problems with me terminating in the DC -- so at least that cost

            • by thule ( 9041 )

              Bottom line, it isn't a matter of "willing to pay for" (I would LOVE my fiber idea), it is a matter of *capable* of paying for.

              Yes, exactly. But the point still stands that there are choices. For example you can use cable company fiber to pull into a large building and just buy Ethernet service from them. That way you can choose your transit and bypass the possibility of Net Neutrality issues. You can also re-sell the bandwidth to others in the building so the cost can be shared. It works! It took months (only!?) to get all the permitting and agreements done to pull the fiber into the high-rise building.

              • by r_naked ( 150044 )

                You still don't get it.

                Let's hypothetically say that Netflix had peering agreements with Level 3, AT&T, Centurylink, etc. (the Tier 1 providers), and I also had peering agreements with the same. With net neutrality gone, those backbone providers can charge ME *AND* Netflix extra to carry our traffic. So, I am sure you will say: "HEY, there are multiple Tier 1 providers, so they can compete for your business!". OK, so I am supposed to peer with EVERY Tier 1 provider? Unrealistic. I don't think you unders

                • by TheSync ( 5291 )

                  Let's hypothetically say that Netflix had peering agreements with Level 3, AT&T, Centurylink, etc...

                  Netflix was never a real "peer" because they dump huge amounts of traffic onto end-user ISPs. Real peers have an equitable mix of traffic in and out. Yet I don't think any end-user ISP was ever asking Netflix to pay-per-bit.

                  But even if you have a peering agreement, you are responsible for paying for the equipment to exchange the traffic you want.

                  And Netflix thought if it didn't upgrade its inter

                  • by Bengie ( 1121981 )
                    Internet traffic is mostly broken up into two categories of traffic, Transit, which is expensive because you need to move the data all around the world, and non-transit peering, which is almost always free because it benefits both networks and it gets rid of the transit costs for both of them. Verizon, for example, was trying to get Netflix to pay 10x the going rate of transit, for non-transit peering.

                    This put Netflix in quite the pickle. Level 3 wanted to use local peering with Verizon because Level 3 an
        • by Kjella ( 173770 )

          So if my ISP doesn't want to pay the "Netflix carriage charge" to the backbone provider that they use, Netflix is thrown back to the "buffering 90s", and I drop Netflix -- not my ISP -- because I have NO CHOICE.

          He's not talking about you on the individual level. He's talking about a corporate stare-down between Netflix and your ISP. That some people will pick a lesser plan or no plan because Netflix isn't working well. That Netflix can do naming and shaming, making that ISP deal with customer service complains and lose customers who do have a choice. That Netflix is big enough to say it works for hundred million other subscribers, your ISP is the problem and the financial backbone to not blink first. A lot of this

        • Netflix streams fine on my 3mbs ADSL line. Indeed 1.5mbs is enough.

          • Is that 5 simultaneous streams? Or 2 Netflix, a Hulu, and HBO? Is that 4k?

            Yea, didn't think so.

            Not to mention it is nice being able to use the Internet for something besides video at the same time.

            Cord cutting .... look it up.

          • by Bengie ( 1121981 )
            Netflix consumes on average 8Mb/s/stream for devices at my home. It's downgrading the bit-rate for your connection.
        • by Bengie ( 1121981 )
          Use them unlimited cellphone minutes to call and complain every time you have issues. The average rate of an ISP's callcenter is $3/minute. 20 minutes a month will cost them $60/m. Incentive them to fix their network.
      • That would only be true if ISPs had competition like in a regular market.

        I've lived in 5 houses in three states over the last 15 years and never once had a realistic choice of ISPs.

    • And if Netflix are forced to pay, they will pass on the cost to the subscriber, its not a hard sum after that to figure out who is actually paying.

      Its also likely that Netflix and others will choose to invest more heavily in countries who have net neutrality.
      Just remember, 96% of the worlds population (and therefore potential customers) live outside of the USA

      So, in the end loss of net neutrality will end up like the US health system, costs everyone a sh!t load more in the long term with zero addition
      • by TheSync ( 5291 )

        And if Netflix are forced to pay, they will pass on the cost to the subscriber, its not a hard sum after that to figure out who is actually paying.

        And if ISPs are forced for pay for the massive interconnection to carry Netflix traffic, they will pass on that cost to all of their subscribers, even if they are not Netflix subscribers...

        There is no such thing as a free lunch, only a question of who pays for it.

    • I'd see mutually assured destruction.

      The only thing I internet with my home connection is streaming video.

      If Netflix, Hulu, HBO, and YouTube, all become unusable I'm going to drop all of them AND Comcast.

      Netflix and the ISPs need each other as mobile gets better.

  • by RatBastard ( 949 ) on Wednesday May 31, 2017 @04:01PM (#54520847) Homepage

    FTFA: "It's not narrowly important to us because we're big enough to get the deals we want," Hastings said.

    Gee, thanks a lot, asshole. Nice to see you have no regard for anyone but yourself.

    • by Altrag ( 195300 )

      Its probably an overly blunt choice of words, but you can hardly blame them for not putting time and money into a fight they no longer care about.

      They have bigger fish to fry, like trying to negotiate their way out of geoblocking requirements and the ability to secure content in an age where every distributor on the planet is trying to make their own mini-Netflix (and then refusing to renew Netflix' licenses to their content) and the ones that aren't just flat out getting greedy and charging more and more t

  • Basically, they went to the other side.
    It was never really about small companies or costumers, it was just about themselves.
    Nowadays Netflix is big enough to impose their own demands and prices on ISPs and whatnot, and they in fact have all the interest on stopping new players in the market.
    It's f*cking shameless to come up and say something like that with all the defenses they made back in 2014, sure, but it's also partially true.
    But yeah, here, for those who don't remember:
    http://www.huffpostbrasil.com/.. [huffpostbrasil.com]

  • Certain large ISP's have agreed to only charge me X if I stop fighting for NN. Otherwise they are gonna bend me over a barrel. I'm good!
  • that the more important fight for Netflix is content rights, since without content that people want to watch, net neutrality doesn't matter
  • by account_deleted ( 4530225 ) on Wednesday May 31, 2017 @04:16PM (#54520951)
    Comment removed based on user account deletion
  • or translated (Score:4, Insightful)

    by jmccue ( 834797 ) on Wednesday May 31, 2017 @04:22PM (#54521003) Homepage

    There are startups in the wings, we want to make sure they never grow.

    • I suspect they even think they could kill Hulu now that it's a pay service only.

      Netflix has much more cultural relevance, therefore more negotiating power.

      Buying their own premium content greatly increased their value (to ISPs).

  • Fuck you, Reed Hastings, right back at you.

    Let's start flooding Twitter with #BoycottNetflix hashtag. Bet that'l wake the fucker up.

    • Why? They're still supporting net neutrality, just not banging the pots and pans as loudly. Hastings is being honest that this isn't their fight directly -- it's up to other people to lead this charge. Boycotting Netflix at this juncture on this topic doesn't make any sense.
  • Has anyone ever made a cent on slowing customer data? Or even an unfair peering agreement? The costs to enforce are not worth the potential savings from my seat.

    Netflix has offered and most providers accepted to distributed their devices, called openconnect at ISPs regional headends. Traffic outside of account authorization and enablement transactions never leaves your provider and as netflix moves more than more traffic to end users they will expand their footprint closer to the end users. Per
    • by Altrag ( 195300 )

      Its not so much about slowing data as it is about prioritizing data. You, as a home user, would not have your connection slowed. You're already paying for a certain (maximum) speed and that won't change.

      I, as a prospective new video site operator, also have a contract with my ISP that indicates maximum speeds and other such service level stuff.

      The problem is in the middle. If there's nothing much going on between you and I, then great. I fire data out as fast as I can and you consume it as fast as you c

  • I've been on the fence regarding keeping my NF account. Thanks for making my decision easy, Mr. Hastings.
  • Everyone complains about the Slashdot editors, but nobody Reads TFA to find out whether the summary is misleading. Yeah, I know, nobody RTFA, but seriously, people: you're getting yourselves enraged over a half-truth here.

  • "net neutrality is really important is the Netflix of 10 years ago."

    The rule being so hotly debated was only introduced in 2015 [nytimes.com]. It did not exist 10 years ago — if Netflix rose despite this "critical" rule being absent, so can others...

    • Exactly! I think it would be common sense to deduce the fact that more regulations aren't the answer to a non-existent problem, particularly since the "solution" is so recent. In fact, the real issue is regulation choking out competition in markets that are lacking in competition. NN is a solution in search of a problem.
      • Incorrect. The network was neutral 10 years ago. There was no need for regulation of net neutrality because no one imagined a network that wasn't neutral. Then about 5 years ago, some ISPs started jacking with various forms of traffic (torrents, Netflix downloads, etc). Concurrently, some carriers became content providers. All of the sudden the thing that used to be the default with no need for regulation to protect it became a threatened entity that needed regulation to keep it in place.

        It's like specie
        • We've seen other iterations of anti-consumer decisions. Data limits have always been a bubbling issue and every time someone wants to implement it they can only get reeled back in with competitive forces (the whole voting with dollars idea). Point being that my point still stands that legislating "fairness" isn't helping since the real culprit is a lack of competition. I have a hard time believing that NN hasn't been an ongoing issue for at least the last 15 years, which was the last time I worked in a smal
        • by TheSync ( 5291 )

          Incorrect. The network was neutral 10 years ago. There was no need for regulation of net neutrality because no one imagined a network that wasn't neutral. Then about 5 years ago, some ISPs started jacking with various forms of traffic (torrents, Netflix downloads, etc).

          No ISP has ever been "non-neutral" with Netflix. They just asked Netflix to pay for their side of the interconnection.

          BTW, ISPs have been "de-peering" each other for the entire history of the Internet [I was there, believe me]. If an ISP f

    • WROOOOONG!

      The Internet has ALWAYS operated on the principles of network neutrality. More or less. ISPs were dumb when it came to where a packet came from, where it was going to, and what was in it. UDP is different than TCP, and they played with QoS issues, and there's no way to make Japan closer than Kansas, but hey, it was an ideal they, if not strived for, at least weren't actively working against.

      What you're talking about is "Network Neutrality Regulation". The FCC's enforcement of network neutral

  • I really hope that smaller streaming services survive an era without net neutrality. We assume that Netflix, Hulu, Amazon and other big players will have the ability to negotiate with the main ISPs and work something out and perhaps raise our rates in the process.

    But if streaming HD anime from Crunchyroll is no longer feasible then does that mean the businesses go away and their services disappear or are subsumed by larger streaming services? I use that as an example as it is somewhat of a fringe service, w

    • by TheSync ( 5291 )

      I really hope that smaller streaming services survive an era without net neutrality.

      Smaller streaming services aren't sucking up most of the Internet's bandwidth like Netflix, so ISPs aren't going to bother making them pay for interconnectivity...

      • Smaller streaming services aren't sucking up most of the Internet's bandwidth like Netflix, so ISPs aren't going to bother making them pay for interconnectivity...

        If your streaming service is not prioritized, then you won't be able to get enough packets to your users for HD+ content. If you're too small for an ISP to care about, then you will only have a normal priority. If you're a big player, then you'll have a high priority.

        ISPs obviously want a cut of Netflix, Youtube, Hulu, and Amazon. They can see massive mounts of traffic going through their network and of course they want to target the big players first. But what makes you think that only the big players will

  • I'll give them a pass on net neutrality, as it's really not their fight. What they need to be fighting is regional content deals. I am so sick of having Netflix spastically fail if I'm using a VPN.
  • Comment removed based on user account deletion
  • Netflix already kicks back some of what you pay them to your telecom company. While I can't argue if they want to get larger pipes to your home sooner rather than later, that the telecom companies demand this of Netflix or they will crappify your service violates your contract with your telecom company.

    You probably aren't aware they are lying to you when they tell you they will give you a certain bit rate for a certain fee you pay. They actually extort more money from what you pay Netflix or they will act

    • by Straif ( 172656 )

      It's not a kick back when you actually pay for the service level you require. For years Netflix used their customer base to pressure ISPs to give them excess access to their networks above and beyond any peering agreements with their provider. They basically demanded fiber speeds while paying dialup prices.

      The 'throttling' people complained about was simply ISP like Comcast stopping that practice and telling Netflix to either pay for proper network connections or deal with the customer complaints.

  • If your internet speed is 1Mbps, reducing it by 90% means streaming video goes from "barely possible" to "not really possible".
    If your internet speed is 25Mbps, reducing it by 90% means it goes from "awesome" to "adequate".

    10 years ago, "broadband" was 1 Mbps.
    10 years from now, "broadband" will probably be over 1Gbps, and even then it will be because most people won't care about (i.e. pay for) speeds in excess of that, not because it will be technically infeasible to provide it.

    I predict video streaming (bo

  • "where net neutrality is really important is the Netflix of 10 years ago."

    Oh just come out and say it: Where network neutrality is really important is the competition to Netflix.

    Netflix 10 years ago was the new competition in town.

    Now that they're established and no ISP could keep customers without including Netflix they're on the other side of the power struggle. They're on the side which wants things locked down and kept in place with a massive barrier to entry for new competition. And killing off minor alternatives will let them sleep better at night on their huge piles of

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