Netflix has announced a deal with Comcast to allow a smoother delivery of its video streaming services on Comcast’s network. The deal between the Internet video streaming service and a major Internet service provider (ISP) is the first of its kind.
In a joint statement, the two companies said that they have established a more direct connection between Netflix and Comcast, similar to other networks, that is already delivering a better user experience to consumers, while also allowing for future growth in Netflix traffic.
Response over the deal has been mixed. Many Comcast users applaud the move due to plummeting Netflix speeds that were recently experienced on the network. Others say that the move represents a fundamental shift in net neutrality.
Provisions of Federal Communications Commission (FCC) laws that made ISPs treat all data equally were struck down in January. This means that theoretically the Netflix/Comcast deal could set a precedent for how data from certain companies is handled (i.e., larger companies get larger bandwidth and faster speeds).
This deal reflects a change in the Internet’s structure. Since the 1990s the Internet has shifted from a decentralized free-market backbone model to a more concentrated one.
In the past, a site like Google would have to rely on an independent backbone provider to house its data. The independent backbone provider would then send that data to another backbone provider that would connect your residence to the Internet. In modern times, major companies like Verizon or Comcast have bought out smaller independent backbone providers becoming backbone providers themselves.
Another major shift has occurred with the data itself. Netflix and its 33 million U.S. subscribers account for more than one-third of all Internet traffic at peak times. This means that smaller backbone providers have to deal with increased traffic, which they often can’t handle, and need to rely on the larger networks of companies such as Verizon or Comcast. Users often expect higher speeds of delivery despite the data amount, as no one wants to stare at a loading screen, and will often pay more money to avoid it all together. Essentially, these larger companies are practicing one of the oldest business tactics in the book: cutting out the middleman.
It remains to be seen how the FCC will view the Netflix/Comcast deal from a regulatory standpoint. However, what is clear is that Comcast consumers can stream movies and TV shows until their hearts are content.
What do you think about the Netflix/Comcast deal? Will it end net neutrality and lead to a more concentrated Internet marketplace? Let us know in the comments section or on Facebook, Twitter, and Google +.
[Sources: [Washington Post, The Verge, Comcast, The Wire]