Jeff Baumgartner 12/5/2012 | 5:43:43 PM
re: Netflix Battles Bandwidth Caps

EYE IO execs didn't get into their trade secrets at all, but the exec summary lists two current products:

 -A "production-level" H.264 video encoder

-A H.264 "last pass" re-encoder that reduced bandwidth and storage of video streams already encoded.

 Vargas likened its approach to "artificial intelligence encoding" and that Netflix is adding this capability by adding EYI IO's software code to its existing encoding systems, so it seems likely that we're talking about the "last pass" product in this instance – taking the encoded content and squeezing it down even more.

And they aren't talking about how extensively it's software has been deployed at Netflix. However, they said one indicator is if a Netflix stream starts up in 2-3 seconds (versus 20-30 secs.), you're likely viewing an EYE IO-enhanced stream. JB

craigleddy 12/5/2012 | 5:43:43 PM
re: Netflix Battles Bandwidth Caps

With an oink-oink here and an oink-oink there, Netflix is a bandwidth pig, EYE IO, EYE IO...oh hell, it's not really working.

Anyway, I'm sure service providers will be keeping an eye on this technology because Netflix is a big bandwidth pig and has been getting a free ride on SP pipes for too long. 


Pete Baldwin 12/5/2012 | 5:43:43 PM
re: Netflix Battles Bandwidth Caps

We wrote this much about EYE IO and didn't make a single "Old MacDonald" crack?

Survivorman 12/5/2012 | 5:43:42 PM
re: Netflix Battles Bandwidth Caps

..as a consumer I buy access to/from Netflix servers.  So I don't buy the comment about Netflix gettng a free ride - they're getting the haulage I paid for and hopefully are keeping their pricing more competitive through this.  However I don't object to them paying part of the haulage for better delivery and offering me a higher definition service.  If every Internet start-up had to pay to access consumers there's be a lot fewer of them and a lot less innovation.

paolo.franzoi 12/5/2012 | 5:43:41 PM
re: Netflix Battles Bandwidth Caps

And Netflix pays their bandwidth suppliers.  So, everybody is paid along the path.



Cooper10 12/5/2012 | 5:43:37 PM
re: Netflix Battles Bandwidth Caps

Yes, Netflix pays their bandwidth suppliers - but do they pay proportionate to the bandwidth consumed by Netflix?  When (not if, in my opinion) metered usage becomes a reality on wireline services, then Netflix's costs will reflect their relative usage.  The more you use, the more you pay. 

paolo.franzoi 12/5/2012 | 5:43:35 PM
re: Netflix Battles Bandwidth Caps

Ummm...if you have ever bought bandwidth from a carrier - yes you get usage basage.  You buy a port of size X and a committed capacity of size Y.  The bigger X or Y is the more you pay.

I would be happy with metered usage if the base service cost was 0.  Then I as a consumer (who is using the bandwidth) pays for the bandwidth that I use.  Netflix pays their supplier for the bandwidth they use already.

I don't know why Netflix would pay a carrier that does not provide them bandwidth.  In the phone world, inequities like this are settled between carriers - NOT the end users.



Duh! 12/5/2012 | 5:43:34 PM
re: Netflix Battles Bandwidth Caps

Actually, if you've been following this for a while, you'll know that the compensation issue is really between Netflix CDN supplier Level 3 and the access providers.  Or, more precisely, that the long-standing Internet internetwork compensation model is not transparent and could be argued to be inequitable. 

In an ideal world, Congress would tell the the FCC to step in, conduct an unbiased and transparent rulemaking proceeding, and establish compensation rules that everybody could live with and that would maximize consumer benefit.   Between those who think the gummint should keep its cotton pickin' hands offa the Free Market, and the machinations of lobbyists on all sides, I'm afraid that isn't going to happen.

Cooper10 12/5/2012 | 5:43:34 PM
re: Netflix Battles Bandwidth Caps

Agree, the compensation may very well be between carriers vs. the end-users.  But the point is that an unlimited usage model has to evolve when usage is so disproportionate across users, and growing by double digit %'s.  And while a base service cost of 0 is a nice idea, take a look at your electric bill - there is undoubtedly a "base fee" of some sort that is charged for simply being on the grid.  Would expect a similar model for bandwidth consumption.

craigleddy 12/5/2012 | 5:43:34 PM
re: Netflix Battles Bandwidth Caps

"If every Internet start-up had to pay to access consumers there'd be a lot fewer of them and a lot less innovation."

I agree totally. But service providers would pose the question: what happens when an Internet player like Netflix becomes well established and uses a disproportionate share of bandwidth so that the SP is forced to spend more on CapX (broadband equipment) and OpX (electric power etc) to support that player? The Internet player isn't paying the SP anything but is making them incur more costs.

Oh no! Are we getting into a net neutrality debate?? LOL



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