Pai raps Netflix for not joining Streaming Video Alliance

FCC Commissioner Ajit Pai has taken issue with what appears to be Netflix's (NASDAQ: NFLX) contradictory stance on Internet fast lanes. Pai, in a letter to Netflix CEO Reed Hastings, chided the streaming video company for its "basic argument" that it believes in free and open Internet while at the same time installing "its own proprietary caching appliances throughout ISPs' networks as part of an Open Content program."

Netflix has maintained that its custom network is sufficient to handle its traffic if not blocked by ISPs. That, said Pai, goes against the grain of the recently formed Streaming Video Alliance supported by big name players like Alcatel-Lucent (NYSE: ALU), Charter Communications (NASDAQ: CHTR), Cisco, Comcast (NASDAQ: CMCSA), Epix, Fox Networks Group, Major League Baseball and Yahoo.

In addition to Netflix, YouTube is also missing from an organization that has pledged to focus on an open architecture for streaming video, including defining specifications for network and cloud-based streaming and caching infrastructure; quality of experience; and interoperability to create standards for streaming video.

Netflix carries about one-third of the nation's streaming traffic so its absence on an alliance focused on clearing potential streaming video roadblocks drew Pai's attention.

"If standards collectively agreed upon by much of the industry cannot identify and correctly route Netflix traffic, those standards ultimately are unlikely to be much benefit to digital video consumers," he wrote. "If ISPs were to install open caching appliances throughout their networks all video content providers—including Netflix—could compete on a level playing field. If, however, ISPs were to install Netflix's proprietary caching appliance instead, Netflix's videos would run the equivalent of a 100-yard dash while its competitors' videos would have to run a marathon."

The letter asked Hastings to respond to what appears to be a "conflict with Netflix's advocacy for strong net neutrality regulations."

According to a story in The Hill, Netflix declined to comment on the letter.

For more:
- FCC Commission Ajit Pai wrote this letter
- The Hill has this story

Related articles:
Comcast, Charter, 14 other companies form Streaming Video Alliance
Online video alliances could solve content fragmentation, fend off consolidation
Net neutrality: Netflix says fast-lane fees to Comcast are 150% more than cost of transport
Netflix, Mozilla, others protest FCC net neutrality proposal with Internet Slowdown Day

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