After standing by as Comcast and Level 3 face off over increased network traffic caused by its streaming video business, Netflix has weighed in on the issue implying network discrimination by the cableco.
"(In) late 2010, Comcast informed Level 3 Communications that it would require Level 3 to pay for the ability to access Comcast’s network," reads the comment. "Given that much of the traffic being requested by Comcast customers is Netflix data stored with Level 3, many commentators have looked to this situation as an example of Comcast either discriminating against Netflix traffic or trying to increase Netflix’s operating costs."
Fair enough. But Netflix, whose online movie streaming model has been threatening many a cableco's video on demand business, didn't shy away from directly naming the competitive issue: "Most network operators that provide consumers with access to the Internet also provide these consumers with multichannel video programming. As such, companies like Comcast, Time Warner Cable and Cablevision have an incentive to use their network infrastructure in a manner adverse to our continued growth and success."
Comcast, faced with what it calls an inordinate and exponentially growing amount of traffic being generated by Netflix online streaming, has been demanding since November 2010 that peering partner and content delivery network (CDN) provider Level 3 start paying for the increased traffic.
Comcast cites network degradation and the difficulty in maintaining a consistent user experience across its plant as the issue it's faced with--an issue that will eventually require increased network investment. Level 3 characterises the issue as a fundamental Net neutrality problem, with a big cable MSO taking advantage of its opportunity to put up a "toll booth" in order to protect its television beach head on the competitive waterfront.
For its part, Netflix might agree with Level 3, but says it is waiting for the regulators at the FCC to sort it out. It remains to be seen whether the FCC will look at this as its first big Net neutrality issue since issuing its rules on open access a few weeks ago, in which it made perfectly clear thta content-based discrimination on the part of ISPs will not be tolerated.