Netflix took over the Internet by selling streaming content at a price that wouldn't break the bank. So what would happen if users suddenly had to pay massive mobile data charges to stream Netflix videos? They'd probably get mad at their wireless providers, but many would also stop streaming so much Netflix.
That's the rationale behind a Netflix Inc. (Nasdaq: NFLX) move to cap mobile data streams at 600 kbits/s, according to a Wall Street Journal article that reports the online video company has been throttling its mobile content for years. Pundits argue that the news throws shade on Netflix's banner-waving net neutrality stance. If the company is capping its own streams, it's hard to cry foul when wireless carriers do the same. Both, it appears, are reducing the quality of the video product without giving consumers a choice in the matter.
In particular, Netflix is treating consumers differently depending on which wireless provider they use. The company says it doesn't throttle video streams delivered over Sprint Corp. (NYSE: S) or T-Mobile US Inc. because those carriers tend to slow a user's connection speed rather than tack on data overage fees. But Netflix does reduce the bitrate of its video for customers of AT&T Inc. (NYSE: T) and Verizon Communications Inc. (NYSE: VZ).
Ironically, if Netflix had been upfront about its streaming management practices, it probably would have gotten very little flack for trying to save consumers money. But without providing transparency, and without giving consumers a choice in the matter, Netflix is now coming under fire for doing exactly what it criticizes others for.
Streaming management practices, zero rating services, and sponsored data policies all complicate the net neutrality debate in a world where bandwidth isn't infinite. (See also How to Solve the Sponsored Data Dilemma.)
Unfortunately, while technologies like 5G promise to increase mobile capacity, there's always some application or use case waiting in the wings to suck up more bandwidth. And that means net neutrality arguments, and the net neutrality soapbox, won't fade anytime soon.
— Mari Silbey, Senior Editor, Cable/Video, Light Reading