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The Dangerous Reaction to Netflix-Comcast

Carol Wilson

If you pay any attention to the mainstream press, then you know that the Comcast-Netflix deal announced over the weekend and the deals expected now between Netflix and other broadband ISPs will end net neutrality as we know it, probably drive up the cost of the Netflix service, and reshape the entire Internet business.

I'd agree with our Mari Silbey's report that the Netflix Inc. (Nasdaq: NFLX)-Comcast Corp. (Nasdaq: CMCSA, CMCSK) deal is a game-changer. But I am not convinced that it's the end of the Internet as we know it, which is what you might think if you view USA Today's video version, which comes complete with live artwork. (See Comcast-Netflix Peering Deal: A Game-Changer?.)

As some other tech writers, notably Dan Rayburn of streamingmedia.com and Marguerite Reardon of CNET have correctly noted, this is not a net neutrality issue at all. Nor does it give Netflix an unfair advantage when it comes to traversing broadband access pipes.

But you would only know that, as a news consumer, if you dug a little deeper than most people do.

What Netflix and Comcast have negotiated has to do with where and how the Netflix video content enters the Comcast network, not how it is treated over the last-mile access networks, where cable and telecom companies have a virtual duopoly in the US. It is an agreement that makes business sense for both companies as both have reason for Netflix video traffic to be handled in a way that's appropriate to its volume and specific quality requirements.

The problem is that a nodding acquaintance with network technology can lead the best of us non-IP engineers to think we know exactly how the Internet works. As I, myself, have been reminded of late by some sharp-minded readers, there are too many glib, over-simplified references that fail to recognize the complex interconnection of networks (and business arrangements) that brings the Internet to our doors, or more accurately, our computing devices.

Normally, that lack of total understanding by the general press doesn't matter. But in this case, it's led to some sweeping and sometimes dangerous generalizations about what's really happening between Netflix and Comcast.

Unless and until someone with real power -- say, a member of Congress or a regulator -- decides to use this news coverage as the basis for legislation, the danger is minimal, although such reporting does help prolong the simplified thinking that fuels hatred of large broadband ISPs. (Some would say they pour gas on that fire with poor customer service, but that's a digression I won't risk).

But I can also envision how a journalistically simple-minded view of the Internet could influence coverage of major network outages and security issues -- as well as the kind of protections that might be required to prevent or recover from these. And that could lead to serious problems.

I think it's time for all of us to admit we don't know what we don't know sometimes, and stop trying to wear a mantle of all Internet understanding when it doesn't fit.

— Carol Wilson, Editor-at-Large, Light Reading

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User Rank: Light Beer
3/2/2014 | 5:00:01 PM
Re: Netflix deal not the first one. No big deal.
The question here isn't about a peer connection between Comcast (or Cablevision or Cox etc.) and Netflix. Peering has existed for years, as I'm sure you're aware. The question is - will the cable provider prioritize Netflix on its network and guarantee quality of service for Netflix traffic? That last part - QoS - is very important. How much bigger can we make the pipes? You could argue Moore's law, but if the content competes with Comcast's own content, why would they ensure delivery? The agreement is best for both parties AND consumers - Netflix gets guaranteed quality, consumers get quality video and Comcast gets to monetize that already massive data on its network. I don't see any way forward other than more of these agreements and those agreements will ultimately include all the mobile operators.
User Rank: Light Sabre
2/26/2014 | 11:48:59 AM
Re: Netflix first of many
You've got that right.  I've worked with media for the better half of my life and most want to blow things out of proportion when the opportunity arises - especially when there are folks out there who can stoke the fire.

Of course I am not alluding to any of the folks at Light Reading.  :-)
User Rank: Light Sabre
2/26/2014 | 11:42:34 AM
Re: Netflix first of many
This isn't even going to make the top ten list of internet misunderstandings by the press, let alone the top ten list of misunderstandings or misrepresentations. 

Do you not remember the internet being a series of tubes?

Do you think all the statements about gun legislation, pro or con, are well reasoned?

Have you not been watching House of Cards?

This particular coverage is nothing to get excited over. 
User Rank: Light Sabre
2/26/2014 | 11:14:47 AM
Netflix first of many
Being late to the party on this one, lost of great comments and insights.  And Carol, my reaction to the USA Today article was exactly the same.  Let's stir things up by confusing the issues.  It's a business deal, plain and simple and the only government intervention should be if Comcast provides its service with better connections - especially since, unlike mobile, it does have a monopoly in its service areas.  A somewhat similar example, when I worked at AT&T, they could not sell bachaul to themselves cheaper than to any competitor - if they did, the wrath of the regulators would come down on them.

To me, the issue here is more about how many times are you going to listen to the people at Public Knowldege, or whatever it is, before you realize they will keep complaining until everything is free.  They cry wolf over everything.

Companies invest billions-of-dollars annually to upgrade networks to better serve customers - so using those networks will never be free.  I read somewhere that Netflix accounts for more than 30 percent of all online usage - so they are getting the same ride as mom and pop who use Comcast...and the family usage won't be the one slowing down the networks.

I suggest we stay tuned for the next cry for help - when all this pertain more to the mobile networks which are already struggling to handle traffic.  As it probably takes about 2GB to download a quality version of a movie, and most mobile data plans hover around 10GB, I don't think Netflix customers will pay the equivalent of about $10 to download a movie directly to their mobile device.

User Rank: Light Beer
2/26/2014 | 9:02:58 AM
Netflix deal not the first one. No big deal.
As was pointed out in the article this is not a net neutrality issue but a technical agreement to permit Comcast and its Netflix using customers to have better access to the Netflix streaming video servers.  My local Internet provider, also my local exchange carrier, entered into a similar arrangement with a direct pipe to Netflix and to Amazon's server farm to better serve its customers.  This small telecom has been running last mile fiber to all of its POTS customers and plans to have all of their services, phone, data and cable TV, off copper by the end of the year.  They are boasting Gig-E service that surpasses broadband in most of the US and the world, this in a very rural locality!
User Rank: Light Sabre
2/26/2014 | 8:29:34 AM
Re: What's important
Government participation at this point doens't make sense. You see how well that did with muni Wifi, but it might make sense at some point in the future.

My concern is Comcast becoming to controlling. I'm not a Comcast customer, I live in an area where I still have another cable option along with U-verse and various OTT. But my daughter is in an area where it's Comcast or dialup. Comcast service, contracts, billing practices are all heavy handed. The more Comcast controls, the more heavy handed it will get.

So that I don't take sides, I'll offer political examples from each party that Comcast reminds me of -- Mayor Daley (King Richard, not Jr) and Chris Christie.
User Rank: Light Sabre
2/26/2014 | 5:43:29 AM
Re: No losing our religion

Do shed some light on your statement that "SDN is about as useful as a pig in a barrel in this instance". Make sure you also explain why SDN-powered whitebox switches can't do IP forwarding. Thanks.

User Rank: Light Sabre
2/25/2014 | 9:56:42 PM
Re: No losing our religion
> Heya, dwx - You are right - one of the three is netflix, itself, but:  "Netflix ... [has] a total of three different CDNs, all delivering content in different ways. Some content is delivered inside last mile networks via Netflix's Open Connect program, some is delivered via third party CDNs like Level 3 and Limelight Networks and other content is delivered via servers Netflix controls outside the last mile." Ref: http://blog.streamingmedia.com/2014/02/netflixs-streaming-quality-based-business-decisions-isps-net-neutrality.html

IP SDN reference: http://www.metaswitch.com/download-intelligent-aggregation-white-paper?source=lr

Hit me @dredgie, if you care but don't want to fill out the form! :-)

User Rank: Light Sabre
2/25/2014 | 9:02:17 PM
Re: No losing our religion
Netflix built their own backbone/peering network and CDN nodes so they would not have to rely on others for delivery and much of their traffic today flows through direct interconnects to ISPs.  The holdouts are the largest ISPs like Comcast, TWC, and Verizon, and as you can see that is changing.  

I don't know what you are talking about regarding east-west traffic flow, all of the traffic flow from a Netflix is south to the customer through a direct interconnect.  SDN is about as useful as a pig in a barrel in this instance.  If white label switches mean cheaper ports, then great but that's about the only benefit from using them and at some point the traffic needs to be IP routed to the end customers.  


The reaction I'm tired of hearing is "When will we have Google Fiber!."  As if Google is savior of all bandwidth constraints and peering arrangements.  


User Rank: Light Sabre
2/25/2014 | 6:50:40 PM
Re: No losing our religion
> Jumping off the 'business' aspects, for a moment, you are right, Carol – delivering a service like Netflix through a list mile ISP is extremely complex. They are hosted by AWS and have three different content distribution networks hosted by three different ISPs. Therefore, a streaming request could traverse three ISPs (the customer, AWS and the CDN) while (more importantly) the streaming video may traverse two (one of the three CDNs plus the customer).

At the customer's ISP, they must not only provide service guarantees in the access layers, with agreements like this, but also the PE routers at the local PoP, as traffic would hairpin across those expensive devices from the SDN provider to the customer.

With architectures designed around north-south traffic flows, this migration to east-west is, of course, a major problem carriers rushing to address, both from a cost and quality-of-service perspective - especially when there are increased demands of the latter.

SDN and White Boxes (read: commodity switches) may well be the answer, providing dynamic programmability and cost-effective traffic peering between CDNs and ISPs. I think we'll see more moves in that direction, in the near future. 
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