& cplSiteName &

Netflix Adds AT&T to Pay-to-Peer List

Mari Silbey
7/30/2014
50%
50%

In the latest chapter in the net neutrality saga, Netflix has snared a paid interconnection agreement with AT&T in an attempt to improve video quality for AT&T's Internet subscribers, similar to Netflix's earlier deals with Comcast and Verizon, Mashable reports.

Despite a steady stream of invective between Netflix Inc. (Nasdaq: NFLX) and the service provider community, the online video company continues to add to its list of paid peering deals across the US. These direct connections with last-mile Internet providers ensure that Netflix's video programming has a clearer path to consumers, increasing the quality of service and improving the company's relationship with its customers. (See Blog Wars: Verizon, Level 3 Duke it Out.)

Paid peering agreements are only one way that Netflix optimizes online video delivery. The company also partners with transit providers such as Cogent Communications Holdings Inc. (Nasdaq: CCOI) and Level 3 Communications Inc. (NYSE: LVLT), and it works with some ISPs to install caching appliances in the last-mile network.

However, the paid interconnection agreements with ISPs have sparked controversy because they illustrate the fact that content companies can buy premium access to Internet subscribers. Opponents say these connections create Internet fast lanes, and that they hurt smaller companies that can't afford the cost of high-quality video delivery. (See Comcast's Cohen: Define Internet Fast Lanes.)

Transit providers aren't sitting out the fight either. These middle-mile network companies have repeatedly complained that ISPs aren't giving them a fair deal in peering agreements, and that service providers are even allowing specific peering points to degrade in order to draw the ire of consumers. The Federal Communications Commission (FCC) has agreed to look into the problem even though Chairman Tom Wheeler has made it clear he doesn't believe interconnection deals fall under the umbrella of net neutrality. (See Net Neutrality: Level 3 Sees Peering Progress Soon and Net Neutrality Redux? FCC Probes Peering Problems.)

Further complicating the issue is the fact that even when paid agreements have been struck directly between Netflix and ISPs, the quality of service doesn't necessarily improve right away. While Comcast Corp. (Nasdaq: CMCSA, CMCSK) subscribers have seen quality improvements since Netflix agreed to pay the service provider for a direct connection, Verizon Communications Inc. (NYSE: VZ) subscribers haven't been so lucky. This may be in part because it takes time to upgrade connections, and may also be in part because Netflix is still relying to some extent on transit partners (which are also fighting with ISPs) for delivery to Verizon customers.


For more of Light Reading's coverage of paid peering agreements and the net neutrality battles, check out our OTT video content channel.


According to a statement by AT&T Inc. (NYSE: T), the company reached its agreement with Netflix back in May and has been working to add interconnect capacity since that time. "We’re now beginning to turn up the connections," said a spokesperson, "a process that should be complete in the coming days."

— Mari Silbey, special to Light Reading

(3)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Michelle
50%
50%
Michelle,
User Rank: Light Sabre
7/31/2014 | 10:30:06 PM
Re: Pay To Play
I'm really not looking forward an outcome that includes consumers paying more...
MarkC73
50%
50%
MarkC73,
User Rank: Light Sabre
7/31/2014 | 10:53:03 AM
Verizon
I seriously doubt that time to upgrade has anything to do with a delay in Netflix-Verizon direct peering.  I speculate that its deal making gone awry.  The big loser in this is Cogent, more direct peerings means less need for its CDN for Netflix.
kq4ym
50%
50%
kq4ym,
User Rank: Light Sabre
7/30/2014 | 5:27:48 PM
Pay To Play
This is indeed a complicated issue with good arguments on both sides about the equitable solutions. Somehow though it doesn't just seem that Netflix's actions are going to bode well for the others in the industry. As Netflix goes, so does the rest of the world? Where does the line end as costs rise, and consumers ultimately pay higher amounts to access internet services?
Light Reading’s Upskill U is a FREE, interactive, online educational resource that delivers must-have education on themes that relate to the overall business transformation taking place in the communications industry.
NEXT COURSE
Wednesday, September 28, 1:00PM EDT
Gigabit 101
Will Barkis, Senior Technology Analyst, Orange
UPCOMING COURSE SCHEDULE
Friday, September 30, 1:00PM EDT
Gigabit & the Great Migration
Robert Howald, Vice President, Network Architecture, Comcast
Wednesday, October 5, 1:00PM EDT
Gigabit & Smart Cities
Joe Kochan, COO & Co-Founder, US Ignite
Friday, October 7, 1:00PM EDT
Gigabit & DOCSIS 3.1
Ty Pearman, Director, Access Architecture, Comcast
in association with:
From The Founder
Light Reading today starts a new voyage as part of a larger Enterprise.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
LRTV Interviews
Verizon Takes Next Step on Biz Virtualization Journey

9|26|16   |   4:38   |   (0) comments


At September's NFV & Carrier SDN event in Denver, Light Reading sat down with Victoria Lonker, director of Product and New Business Innovation at Verizon, to chat about where the carrier is with delivering virtualized services to business customers.
LRTV Interviews
Global Services: The $40B Face-Off

9|26|16   |   05:53   |   (1) comment


More service providers than ever before are battling it out to win a slice of what is now a $40 billion global communications services pie, explains Ovum Principal Analyst David Molony.
LRTV Documentaries
MEC Congress: The Key Takeaways

9|22|16   |   03:25   |   (3) comments


Three key takeaways from the Mobile Edge Computing (MEC) Congress in Munich, Germany.
Wagner’s Ring
Time to Shut Up About 'Dumb Pipes'

9|22|16   |     |   (12) comments


Service providers can't compete with OTT players. It just isn't in their DNA. Instead, service providers need to embrace what they're good at -- providing reliable, secure connectivity.
Wagner’s Ring
Keeping Your Tech Career Going After 50

9|21|16   |     |   (13) comments


How do you keep your career moving forward when you're past the half-century mark?
LRTV Interviews
Peering Into the Digital Future

9|20|16   |   04:25   |   (0) comments


Nick Thomas, practice leader of digital media at Ovum, talks about how digital transformation in the technology, media and telecom sectors will enable the development of a new range of applications and services for enterprises and consumers and how the upcoming Digital Futures event in London will examine ...
LRTV Custom TV
Napatech Tackles NFV's Major Challenge

9|7|16   |   08:42   |   (0) comments


One of the main challenges for network operators introducing NFV is to combine performance and flexibility in a cost-effective way, but there is a solution, explains Napatech's Dan Joe Barry.
LRTV Custom TV
Huawei Optical Innovation 2016

9|6|16   |     |   (0) comments


Highlights of the 2016 Huawei Optical Innovation forum.
LRTV Huawei Video Resource Center
Are You Ready for Huawei Connect 2016?

8|31|16   |     |   (0) comments


Join us for an exclusive sneak peak of Huawei Connect, an integrated conference for the global ICT ecosystem taking place in Shanghai.
Between the CEOs
CEO Chat: UXP's Gemini Waghmare

8|26|16   |     |   (0) comments


Light Reading CEO Steve Saunders and UXP Systems CEO Gemini Waghmare discuss the strategic importance of digital identity for operators in the midst of transformation.
LRTV Custom TV
F5 Virtual Network Function Integrations With Partner Orchestration Platform

8|24|16   |   6:38   |   (0) comments


F5's Kishore Patnam, product manager for F5's service provider solutions, discusses why service providers are moving towards virtualization and how his clients are utilizing F5's solutions.
Between the CEOs
CEO Chat: Intel's Alexis Black Bjorlin

8|17|16   |   06:23   |   (0) comments


Join us for an in-depth interview between Steve Saunders of Light Reading and Alexis Black Bjorlin of Intel as they discuss the release of the company's Silicon Photonics platform, its performance, long-term prospects, customer expectations and much more.
Upcoming Live Events
November 3, 2016, The Montcalm Marble Arch, London
November 30, 2016, The Westin Times Square, New York City
December 1, 2016, The Westin Times Square, New York, NY
December 6-8, 2016, The Westin Excelsior, Rome
May 16-17, 2017, Austin Convention Center, Austin, TX
All Upcoming Live Events
Infographics
Hot Topics
Keeping Your Tech Career Going After 50
Mitch Wagner, West Coast Bureau Chief, Light Reading, 9/21/2016
Time to Shut Up About 'Dumb Pipes'
Mitch Wagner, West Coast Bureau Chief, Light Reading, 9/22/2016
Verizon CFO: Eat Our (Fixed) 5G Dust!
Dan Jones, Mobile Editor, 9/22/2016
WiCipedia: The Women Helping Women Edition
Eryn Leavens, Special Features & Copy Editor, 9/23/2016
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Light Reading CEO Steve Saunders and UXP Systems CEO Gemini Waghmare discuss the strategic importance of digital identity for operators in the midst of transformation.
Join us for an in-depth interview between Steve Saunders of Light Reading and Alexis Black Bjorlin of Intel as they discuss the release of the company's Silicon Photonics platform, its performance, long-term prospects, customer expectations and much more.
Animals with Phones
You Thought Your Customer Service Was Unreliable... Click Here
Live Digital Audio

A vital part of increasing the number of women in comms is transforming the ways companies can support and empower women. While progressive company policies that support both men and women in achieving work-life balance are a step in the right direction, creating a company culture that supports those policies can at times be more challenging.

During this show, we'll talk to Lynn Comp, Senior Director of Industry and Sales Enabling (ISE) in the Network Platforms Group at Intel, about why those challenges exist and how companies can overcome them. She'll provide insight into how Intel has worked to create a culture that supports work-life balance, and provide steps and guidance for other companies wishing to do the same. We will also leave plenty of time to get your questions answered live on the air.