Light Reading
Netflix has signed a paid peering agreement with Time Warner Cable, to go along with direct interconnection deals already completed with AT&T, Comcast and Verizon.

Netflix, TWC Sign Pay-to-Peer Deal

Mari Silbey
8/20/2014
100%
0%

Netflix has added one more major service provider to its list of pay-to-peer partners, signing a paid interconnection agreement with Time Warner Cable.

With the latest deal, Netflix Inc. (Nasdaq: NFLX) has now struck interconnection pacts with the four biggest broadband providers in North America. Previously, the Internet video giant inked similar deals with AT&T Inc. (NYSE: T), Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Verizon Communications Inc. (NYSE: VZ). (See Netflix Adds AT&T to Pay-to-Peer List.)

In a statement, a Time Warner Cable Inc. (NYSE: TWC) spokesperson said that TWC "reached an agreement with Netflix in June, and we began the interconnection between our networks this month." The spokesperson also confirmed that the paid connections with Netflix will cover all of TWC's markets.

The latest interconnection deal for Netflix comes as the debate over paid peering agreements continues to escalate in the press and in broadband policy circles. Somewhat ironically, Netflix continues to sign these agreements even as CEO Reed Hastings repeatedly rails against the practice in public forums. In an article penned for Wired this week, Hastings explained why he opposes paid peering, and why he believes that Netflix must sign these agreements with ISPs anyway.

"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 said. "The ISPs argue that our data-rich services take up limited capacity on their networks. But broadband is not a finite resource. Network limitations are largely the result of business decisions to not keep pace with subscriber demand in a world where the Internet increasingly is the main vehicle for all kinds of entertainment, from gaming to movies to video chats with loved ones."

In a statement specifically about Time Warner, a Netflix spokesperson insisted that there will now be no more such deals. "The agreement with Time Warner is the last," the spokesperson said. "We reluctantly signed this agreement -- and the three others -- to ensure our subscribers get the viewing experience they expect when watching Netflix. We continue to believe consumers should get the Internet they pay for without both the sender and receiver being charged for the same content."

The Netflix argument is that ISPs should pay for expanded broadband capacity to meet consumer demand for online entertainment. Many ISPs, on the other hand, believe that Netflix should pay the freight for content delivery, given that the video company is estimated to be responsible for more than 30% of downstream Internet traffic.

Other opponents of paid peering also point to the idea that if all content providers have to pay ISPs for higher-quality video streaming, then fewer new companies will enter the business because of the delivery cost barrier. That argument has some weight, but it also has to be countered with the reality that any new service would have to build a large audience before any paid interconnection agreement would be necessary.


Get the latest updates on the pay-to-peer and net neutrality battles by visiting Light Reading's OTT content channel.


One question that has not been answered is what the traffic threshold is for when a content provider must pay an ISP for direct connection. Apple Inc. (Nasdaq: AAPL) has also signed paid peering agreements, but the details of those deals -- and the ones signed by Netflix -- are all confidential.

As a result of public outcry over the issue, the Federal Communications Commission (FCC) has agreed to look into peering deals more closely. In a statement in June, FCC chairman Tom Wheeler said, "To be clear, what we are doing right now is collecting information, not regulating. We are looking under the hood. Consumers want transparency. They want answers. And so do I." (See Net Neutrality Redux? FCC Probes Peering Problems.)

Related posts:

— Mari Silbey, special to Light Reading

(2)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
danielcawrey
50%
50%
danielcawrey,
User Rank: Light Sabre
8/21/2014 | 4:48:09 PM
Re: OTT Business viability affect
What's going to happen when some new data-driven product or services begins taxing the ISPs? Look, I understand why ISPs don't want to be paying for content that is being delivered by another provider – it competes directly with many cable subsidiary businesses these organizations have. But this is an issue that is not going away anytime soon. 
Atlantis-dude
50%
50%
Atlantis-dude,
User Rank: Light Sabre
8/20/2014 | 6:04:01 PM
OTT Business viability affect
Wonder if Netfilx will reveal any numbers at their quarterly.
Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Custom TV
Using Service Quality to Drive WiFi Monetization

10|22|14   |   6:51   |   (0) comments


Live from the SCTE conference: Heavy Reading's Alan Breznick explores the forces shaping the WiFi opportunity in an interview with CableLabs' Justin Colwell and Amdocs' Ken Roulier.
LRTV Custom TV
Distributed Access Architectures – 2

10|21|14   |   8:51:00 AM   |   (0) comments


ARRIS CTO Network Solutions Tom Cloonan discusses why many if not most MSOs will continue with integrated CCAP, while addressing why some are also looking at two futuristic, distributed access architectures: Remote PHY and Remote CCAP.
LRTV Custom TV
Distributed Access Architectures – 1

10|21|14   |   9:01   |   (0) comments


SCTE Sr. Director of Engineering Dean Stoneback discusses the pros and cons of distributed access architecture (DAA) and its various forms, which range from basic Remote PHY to full CMTS functionality in the node.
LRTV Custom TV
The WiFi Road to Riches – 2

10|21|14   |   3:58   |   (0) comments


ARRIS Senior Solution Architect Eli Baruch talks about how MSOs can enable public and community WiFi through 1) outdoor access points, 2) businesses seeking to offer WiFi to customers, and 3) residential WiFi gateway extensions.
LRTV Custom TV
The WiFi Road to Riches – 1

10|21|14   |   10:15   |   (0) comments


SCTE Director of Advanced Technologies Steve Harris discusses WiFi deployments, drivers, challenges and advances, including 802.11ac, carrier-grade WiFi, community WiFi, Hotspot 2.0, Passpoint, WiFi-First and voice-over-WiFi.
LRTV Custom TV
Advantech Accelerates 100G Traffic Handling

10|17|14   |   7:56   |   (0) comments


Paul Stevens from Advantech explains why handling 100GbE needs a whole new platform design approach and how Advantech is addressing the needs of equipment providers and carriers to give them the flexibility and performance they will need for SDN and NFV deployment.
LRTV Huawei Video Resource Center
Holland's Imtech Traffic & Infra Discusses Huawei's ICT Solution and Services

10|16|14   |   4:49   |   (0) comments


Dimitry Theebe is from the business unit at Imtech Traffic & Infra which delivers communications solutions for transportations. His partnershp with Huawei began about a years ago. In this video, Theebe speaks more about this partnership and what he hopes to accomplish with Huawei.
LRTV Huawei Video Resource Center
Huawei's Comprehensive Storage Solutions Vital for SVR

10|16|14   |   6:16   |   (0) comments


SVR Information Technology provides cloud services for academic and special sectors. With Huawei's support, SVR and Yildiz Technical University has established Turkey's largest and most advanced High Performance Computing system. CSO Ismail Cem Aslan talks about what he hopes Huawei's OceanStor storage system will bring for him.
LRTV Huawei Video Resource Center
Mexico's Servitron's Impression of Huawei at CCW 2014

10|16|14   |   6:35   |   (0) comments


Servitron is a network operator in Mexico that has been in the trunking industry for the past 20 years. Its COO, Ing. Ragnar Trillo O., explains at Critical Communications World 2014 that his company has been interested in the long-term evolution of LTE technology and its adoption for TETRA.
LRTV Huawei Video Resource Center
Building a Better Dubai

10|16|14   |   2:06   |   (0) comments


Abdulla Ahmed Al Falasi is the director of commercial affairs, a telecommunications coordinator for the government of Dubai. Their areas of service span across multiple industries, including police, safety, shopping malls and more. In this video, Abdulla talks about his department's work with Huawei.
LRTV Huawei Video Resource Center
Huawei Lights Up Malaysia Partner Maju Nusa

10|16|14   |   1:59   |   (0) comments


Malaysia's Maju Nusa is an enterprise partner to Huawei in networking, route switches and telco equipment. At this year's Critical Communications World in Singapore, CTO Pushpender Singh talks about what Huawei's eLTE solutions mean to his company and for Malaysia.
LRTV Custom TV
Evolving From HFC to FTTH Networks

10|15|14   |   2:19   |   (0) comments


Cisco's Todd McCrum delves into the future of cable's HFC plant, examining how DOCSIS 3.1 and advanced video compression will extend its life and how the IP video transition will usher in GPON and EPON over FTTH.
Upcoming Live Events
October 29, 2014, New York City
November 6, 2014, Santa Clara
November 11, 2014, Atlanta, GA
December 2, 2014, New York City
December 3, 2014, New York City
December 9-10, 2014, Reykjavik, Iceland
February 10, 2015, Atlanta, GA
June 9-10, 2015, Chicago, IL
Infographics
WhoIsHostingThis.com presents six of the world's most extreme WiFi hotspots, enabling the most epic selfies you can imagine.
Hot Topics
Analysts Warn of Major NFV Gaps
Carol Wilson, Editor-at-large, 10/22/2014
Is Health the Killer App for the IoT?
Jason Meyers, Senior Editor, Gigabit Cities/IoT, 10/22/2014
Drones Hover Over the IoT Sector
Jason Meyers, Senior Editor, Gigabit Cities/IoT, 10/23/2014
The Human Gain of the Smart Home
Robin Mersh, 10/20/2014
Zayo Zooms Out of the IPO Gate
Dan O'Shea, Managing Editor, 10/17/2014
Like Us on Facebook
Twitter Feed