OpEd from InfoWorld on Two Timing Netflix





  • Horrible post really.

    My problem with this entire thing is I have not had the time to read enough of the details myself. Relying on "media" is a horrible thing, but all I have had time for. There is no good news coverage of everything.

    Content companies SHOULD be paying the peering agreements. Peering agreements are not about net neutrality. they are paying for the services being used. But a lot of what I have seen about this stuff is beyond peering agreements.



  • That's not quite true. Peering is not for services used, Netflix already pays for that. Look at MangoLassi. You pay for access to the Internet. MangoLassi pays for access to the Internet. Are you saying that both you and MangoLassi should have to pay an additional fee for each service that you want to use and each customer's network that ML's customers sit on? Obviously ML is low volume and no one cares, but you see how there is a problem? Both sides already pay for access to each other. Why would both of you then be charged again for access you already paid for?

    There is a reason that it is called double dipping, it is charging twice for the same connection. Now the peering the Netflix is getting will, I assume, provide it special lower latency, high bandwidth connections to some networks. Maybe. But we don't know if that will remain true. But no matter what, it signals a potential end to the pubic Internet. Once the Internet is "just those services no one singled out" we have a problem. It's no different than if your provider was holding those services hostage - only presenting you with solutions that have "paid them off" beyond paying for the Internet access. It means that the same, open Internet won't be universal. Each person, service and/or network will have unique content not based on the desires of those parties but on the ability of the network to bully the services or the customers into paying a premium for content and that premium being not to the parties involved.

    It would be like a toll road not just charging a toll (access fee) but then charging extra based on you intended destination after you've left the highway. They would charge you $1.50 to get off at exit 25 but you'd have to pay an extra dollar, or McDonald's would have to pay it for you, if you intend to stop at McDonald's at that exit.



  • Sounds like these guys want the old AOL network style back.. the next year or two are going to be interesting (read depressing).



  • If the content company pays for [Big Fat Internet Pipe] and the consumer pays for [Big Fat Residential Pipe], why would the content company need to pay more? Their [Big Fat Internet Pipe] costs a fortune and covers their costs. If it's a bandwidth cost factor, the pricing on the pipes should be re-evaluated.



  • @alexntg said:

    If the content company pays for [Big Fat Internet Pipe] and the consumer pays for [Big Fat Residential Pipe], why would the content company need to pay more? Their [Big Fat Internet Pipe] costs a fortune and covers their costs. If it's a bandwidth cost factor, the pricing on the pipes should be re-evaluated.

    Exactly. What are they paying for if not the access?



  • So what you're saying is that Comcast, etc should be going after Netflix's tier one ISP, not Netflix directly since the peering from Comcast, etc to Netflix's tier one ISP is not equal. These costs of course would be passed along either to all of the customers to the tier one ISP or possibly directly to Netflix.

    This is probably fair, but I'd have to consider it more.



  • @Dashrender they shouldn't go after anyone. Everyone is already paying full price for the connections.



  • @scottalanmiller I understand that companies/people are already paying... but the peering it no longer equal, not even close. I heard somewhere that something like 80% of the traffic at night in the USA is coming from Netflix... this definitely says that peering isn't equal. I don't consider it bad faith if the other partners in the peering group want to be better compensated for this.

    The US cell carriers I'm guessing have something similar setup. If AT&T suddenly started sending 500% more traffic to Sprint than Sprint was sending to ATT, I would expect Sprint to want ATT to pay something for carrying the traffic.



  • @Dashrender said:

    @scottalanmiller I understand that companies/people are already paying... but the peering it no longer equal, not even close. I heard somewhere that something like 80% of the traffic at night in the USA is coming from Netflix... this definitely says that peering isn't equal. I don't consider it bad faith if the other partners in the peering group want to be better compensated for this.

    The US cell carriers I'm guessing have something similar setup. If AT&T suddenly started sending 500% more traffic to Sprint than Sprint was sending to ATT, I would expect Sprint to want ATT to pay something for carrying the traffic.

    You are hearing the marketing. Netflix is paying for that 80% already. They already pay equal. Charging them again is double dipping. You are talking about charging for the same bandwidth twice.



  • Of course they want to be better compensated but we are talking about extortion, not fair pricing. Netflix pays the same access rates as everyone else. The carriers want to block Netflix to open the way for them to provide that same service themselves. This is about unfair blocking of competition.



  • If Comcast wanted to sell email they would say the same thing about Office 365 and try to shut them down. They can overcharge or choke any competition that they want - even when that competition is already paying their share of the access.

    As it is both Netflix AND their customers pay for access. Comcast gets money from both sides if that connection already. Charging Netflix again should be illegal.



  • Try it in reverse. What if you pay $80/mo for 50Mb/a of internet access. But your carrier says "oh, you are streaming video over that, you have to pay for your access again."

    You'd be furious. You've already paid for access. Now they are blocking the content that you want and making you pay again. You paid for internet access but in irder to charge you again they took away the access that they already sold to you in order to sell it to you again.

    That is a very possible conclusion to where Comcast is going. No different that what the are doing to Netflix.



  • @scottalanmiller said:

    Of course they want to be better compensated but we are talking about extortion, not fair pricing. Netflix pays the same access rates as everyone else. The carriers want to block Netflix to open the way for them to provide that same service themselves. This is about unfair blocking of competition.

    You are mixing up the various pieces of this discussion.
    Peering has NOTHING directly to do with ANY end user. Peering by definition is a free swap of data between two networks. Note the word networks. Not end users. An agreement between a network (TWC) and another network (Cogent (Netflix leased)) to peer or swap data is generally only agreed upon when the data over time is expected to be somewhat balanced. These networks are generally referred to as CDN (Content Delivery Networks). Netflix and other high bandwidth services are severely over balancing the the scales of data flow.
    Now that peering is out of the way, let's talk about end users. I pay Charter $45 a month for a 30/5 connection to Charter's network. Charter then has to pay to connect their network to other networks or Charter has to reach a peering agreement with each of the other networks. Netflix as an end user pays for their connection to the internet to some provider who then also has to pay to connect to the other networks or reach peering agreements with them.
    Netflix is also a network by virtue of their leasing Cogent facilities. They are a network that is basically ONLY sending data out. The data they are receiving is so tiny as to not matter. This comes no where close to a balanced flow of data that all the peering agreements that the internet was built on. If Netflix was not also a network I would have more feelings for them. They chose to become a network, they are no longer an end user.



  • @scottalanmiller said:

    @Dashrender said:

    @scottalanmiller I understand that companies/people are already paying... but the peering it no longer equal, not even close. I heard somewhere that something like 80% of the traffic at night in the USA is coming from Netflix... this definitely says that peering isn't equal. I don't consider it bad faith if the other partners in the peering group want to be better compensated for this.

    The US cell carriers I'm guessing have something similar setup. If AT&T suddenly started sending 500% more traffic to Sprint than Sprint was sending to ATT, I would expect Sprint to want ATT to pay something for carrying the traffic.

    You are hearing the marketing. Netflix is paying for that 80% already. They already pay equal. Charging them again is double dipping. You are talking about charging for the same bandwidth twice.

    OHHH.. I didn't know that.. is there an article on that somewhere?



  • @JaredBusch said:

    @scottalanmiller said:

    Of course they want to be better compensated but we are talking about extortion, not fair pricing. Netflix pays the same access rates as everyone else. The carriers want to block Netflix to open the way for them to provide that same service themselves. This is about unfair blocking of competition.

    You are mixing up the various pieces of this discussion.
    Peering has NOTHING directly to do with ANY end user. Peering by definition is a free swap of data between two networks. Note the word networks. Not end users. An agreement between a network (TWC) and another network (Cogent (Netflix leased)) to peer or swap data is generally only agreed upon when the data over time is expected to be somewhat balanced. These networks are generally referred to as CDN (Content Delivery Networks). Netflix and other high bandwidth services are severely over balancing the the scales of data flow.

    This is what I was talking about - and what I'm hoping that Scott has a link to that somehow shows that Netflix is paying Cogent for Netflix's over use of the peering connections to other networks.



  • @JaredBusch said:

    Netflix is also a network by virtue of their leasing Cogent facilities. They are a network that is basically ONLY sending data out. The data they are receiving is so tiny as to not matter. This comes no where close to a balanced flow of data that all the peering agreements that the internet was built on. If Netflix was not also a network I would have more feelings for them. They chose to become a network, they are no longer an end user.

    Can you break this down for me? How does Netflix leasing Cogent facilities make them a network, and why does this matter?



  • Back to the matter at hand - why is Netflix even involved in these talks? The carriers should be going after Cogent since that is Verizon's, etc, peering partner, not Netflix!



  • @Dashrender said:

    Can you break this down for me? How does Netflix leasing Cogent facilities make them a network, and why does this matter?

    When you lease a network, you ARE a network. Otherwise you would not be leasing the network you would be paying to use it as an end user.



  • @JaredBusch said:

    @Dashrender said:

    Can you break this down for me? How does Netflix leasing Cogent facilities make them a network, and why does this matter?

    When you lease a network, you ARE a network. Otherwise you would not be leasing the network you would be paying to use it as an end user.

    So if I decided to lease space in the Cox DC I'm now somehow part of the 'network' of the internet and would be subject to the same peering issues as the ISP themselves? How does that make sense? I'm still my own company, I just want closer connection to the first hop to the backbone.



  • @JaredBusch said:

    @scottalanmiller said:

    Of course they want to be better compensated but we are talking about extortion, not fair pricing. Netflix pays the same access rates as everyone else. The carriers want to block Netflix to open the way for them to provide that same service themselves. This is about unfair blocking of competition.

    You are mixing up the various pieces of this discussion.
    Peering has NOTHING directly to do with ANY end user. Peering by definition is a free swap of data between two networks. Note the word networks. Not end users. An agreement between a network (TWC) and another network (Cogent (Netflix leased)) to peer or swap data is generally only agreed upon when the data over time is expected to be somewhat balanced. These networks are generally referred to as CDN (Content Delivery Networks). Netflix and other high bandwidth services are severely over balancing the the scales of data flow.
    Now that peering is out of the way, let's talk about end users. I pay Charter $45 a month for a 30/5 connection to Charter's network. Charter then has to pay to connect their network to other networks or Charter has to reach a peering agreement with each of the other networks. Netflix as an end user pays for their connection to the internet to some provider who then also has to pay to connect to the other networks or reach peering agreements with them.
    Netflix is also a network by virtue of their leasing Cogent facilities. They are a network that is basically ONLY sending data out. The data they are receiving is so tiny as to not matter. This comes no where close to a balanced flow of data that all the peering agreements that the internet was built on. If Netflix was not also a network I would have more feelings for them. They chose to become a network, they are no longer an end user.

    Netflix is not a network. They are still end users, at least most places. They are on Amazin cloud and are distributed all over just like other end users.



  • @Dashrender said:

    @JaredBusch said:

    @Dashrender said:

    Can you break this down for me? How does Netflix leasing Cogent facilities make them a network, and why does this matter?

    When you lease a network, you ARE a network. Otherwise you would not be leasing the network you would be paying to use it as an end user.

    So if I decided to lease space in the Cox DC I'm now somehow part of the 'network' of the internet and would be subject to the same peering issues as the ISP themselves? How does that make sense? I'm still my own company, I just want closer connection to the first hop to the backbone.

    Being in a DC does not make you a network. That makes you a customer just like anything else.



  • @Dashrender Here is a well written article. The info graphic in the middle is useful.
    http://www.fool.com/investing/general/2014/03/01/understanding-netflix-comcast-and-the-magic-of-mod.aspx



  • @Dashrender said:

    @JaredBusch said:

    @scottalanmiller said:

    Of course they want to be better compensated but we are talking about extortion, not fair pricing. Netflix pays the same access rates as everyone else. The carriers want to block Netflix to open the way for them to provide that same service themselves. This is about unfair blocking of competition.

    You are mixing up the various pieces of this discussion.
    Peering has NOTHING directly to do with ANY end user. Peering by definition is a free swap of data between two networks. Note the word networks. Not end users. An agreement between a network (TWC) and another network (Cogent (Netflix leased)) to peer or swap data is generally only agreed upon when the data over time is expected to be somewhat balanced. These networks are generally referred to as CDN (Content Delivery Networks). Netflix and other high bandwidth services are severely over balancing the the scales of data flow.

    This is what I was talking about - and what I'm hoping that Scott has a link to that somehow shows that Netflix is paying Cogent for Netflix's over use of the peering connections to other networks.

    You are putting words in my mouth. I said they paid for bandwidth. I don't agree in the concept of abusing the peer.

    How do you define abusing a service you buy? Netflix pays for their bandwidth. If the didn't Amazon and cogent would kick them out. The bandwidth is paid for. Saying that they abuse it seems ridiculous to me. Don't sell something if you won't allow someone to use it. You don't call it abusing a hamburger when you sell it and someone eats it. That's its purpose.

    When you buy bandwidth people should expect you to use it. If they aren't happy with that they should not have sold it to you.

    No different than how any home user abuses their peering by watching Netflix. The traffic is nearly all one direction. No one would ever call the obvious use case "abuse".



  • @scottalanmiller All of the above aside, what Comcast is trying to do is harmful as it IS trying to make sure their stuff wins unless you pay them. But the entire picture is most certainly not as simple and black and white as you are trying to depict things.



  • @Dashrender said:

    @JaredBusch said:

    Netflix is also a network by virtue of their leasing Cogent facilities. They are a network that is basically ONLY sending data out. The data they are receiving is so tiny as to not matter. This comes no where close to a balanced flow of data that all the peering agreements that the internet was built on. If Netflix was not also a network I would have more feelings for them. They chose to become a network, they are no longer an end user.

    Can you break this down for me? How does Netflix leasing Cogent facilities make them a network, and why does this matter?

    I'm confused on that too since that would make NTG a network or me at home a network. Which obviously they are, everything past a router is a new network. So it seems that the peering extortion could, again, be applied to home users the same as Netflix.



  • @scottalanmiller said:

    How do you define abusing a service you buy? Netflix pays for their bandwidth. If the didn't Amazon and cogent would kick them out. The bandwidth is paid for. Saying that they abuse it seems ridiculous to me. Don't sell something if you won't allow someone to use it. You don't call it abusing a hamburger when you sell it and someone eats it. That's its purpose.

    A peer is NOT purchased by definition.



  • @Dashrender said:

    Back to the matter at hand - why is Netflix even involved in these talks? The carriers should be going after Cogent since that is Verizon's, etc, peering partner, not Netflix!

    Exactly.



  • @JaredBusch said:

    @Dashrender said:

    Can you break this down for me? How does Netflix leasing Cogent facilities make them a network, and why does this matter?

    When you lease a network, you ARE a network. Otherwise you would not be leasing the network you would be paying to use it as an end user.

    How is that different than my house. I lease that subnet from Optimum.



  • @Dashrender said:

    @JaredBusch said:

    @Dashrender said:

    Can you break this down for me? How does Netflix leasing Cogent facilities make them a network, and why does this matter?

    When you lease a network, you ARE a network. Otherwise you would not be leasing the network you would be paying to use it as an end user.

    So if I decided to lease space in the Cox DC I'm now somehow part of the 'network' of the internet and would be subject to the same peering issues as the ISP themselves? How does that make sense? I'm still my own company, I just want closer connection to the first hop to the backbone.

    As a company that does this. I'm confused. We are end users like everyone else.


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