Saying Netflix (NASDAQ: NFLX) has entered peering agreements with AT&T (NYSE: T), Comcast (NASDAQ: CMCSA), Verizon (NYSE: VZ) and--most recently--Time Warner Cable (NYSE: TWC) "reluctantly," company CEO Reed Hastings has penned an op-ed in Wired, urging federal regulators not to "give in" to the big Internet service providers.
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The declaration came amid reports that Netflix signed its latest interconnection deal with a major Internet service provider, TWC, in June.
"This year we reluctantly agreed to pay AT&T, Comcast, and Verizon for access to our mutual subscribers, who were seeing a rapid decline in their Netflix viewing experience because of congestion at the connection point where we transfer content to the ISP," Hastings writes.
"We'll never realize broadband's potential if large ISPs erect a pay-to-play system that charges both the sender and receiver for the same content…Customers pay companies like AT&T, Comcast, and Verizon a monthly fee, and some are even financially penalized if they exceed usage caps. Charging us a separate fee ultimately means consumers pay twice--first for their broadband connection and second through higher-cost or lower-quality Internet services."
In summation, Hastings urged the Federal Communications Commission to look past the last-mile connections it has traditionally focused on.
"Today's problem spots are further upstream, at the choke point where companies like Netflix pass our traffic off to the ISPs," he writes. "If the FCC doesn't expand its purview to include these transactions, it would be better to have no rules than the ones being proposed--which simply legalize discrimination on the Internet."
For more:
- read this Wired story
Related links:
Why the FCC should take the Title II path to net neutrality
Hastings: Don't worry, ISPs, Netflix won't charge you for the 'privilege' of carrying its data
Reed Hastings: Comcast 'wants the whole Internet'