Great Article About Media Hyping Comcast/Netflix Deal

Monday, February 24, 2014 by Island Dog | Discussion: Life, the Universe and Everything

This has been a confusing deal going on with Netflix, and the media has used this as an excuse to use "Net Neutrality" whenever possible.  This is a great read on the details of this deal.

"Naturally, many of these same people are also implying that because Netflix has to pay Comcast, consumers will foot the bill for this as Netflix will have to charge more for their service. This could not be further from the truth. Those stating this have no clue how Netflix delivers their content today or what costs they already incur."

Reply #1 Monday, February 24, 2014 3:42 PM

This deal reflects my long-held belief that what we are seeing in the media is a highly distorted version of what goes on behind the numbers. I've commented on this in the past as well. The discussion has become all about how Netflix is fighting the good fight, supporting net neutrality. In the other side of the ring, the big bad pseudo-monopolies who only want to lower your service while charging more for it.

And yet, it is those companies that need to pay for expanding their capabilities. Just Netflix on their own are estimated to account for up to 30% of all downstream traffic in the U.S. So to me it seems more than fair that Netflix should have to pay extra to stay equal. So with no rules to block them, it should come as no surprise that Netflix's priority plummets. Comcast bagged the first big deal from Netflix, Verizon hopes to do the same.

Netflix found a great niche in the market. An incredibly under-priced good (bandwidth) and potential customers on the other end. Now the bill is coming due, and I expect we'll see some serious changes to how Netflix prices their services from here on out. But there may be some benefits as well, for the customers that is. First, there may be an increased transparency in how much ISPs charge to carry traffic. And second, this may mean a higher visible demand for better services from the ISPs.


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