Comcast, Netflix and Level 3 - your thoughts?

[Fish Actuary]

Comcast is apparently demanding that Netflix via one of it's service providers, Level 3, needs to pay them to have their content delivered to customers. I'm curious as to what others think on this?

It seems to me that Comcast is attempting to double-dip here, collecting fees from consumers to have some amount of internet content delivered to their homes and then charging Netflix and Level 3 to deliver that same content to the same consumers. It seems like a more legitimate approach for Comcast on this issue would be to increase the fees they are charging their subscribers for bandwidth, rather than behaving like a gangster demanding protection fees from the companies along their street. I suspect part of their actions are based on a need to protect their business model which is on the verge of collapsing as people decide that they don't want to pay for dozens or hundreds of stations that they don't watch, and would rather pay for just 1 or 2 shows on each channel that they do watch.

:link: (http://www.theglobeandmail.com/globe-investor/netflix-sky-high-valuation-leaves-no-room-for-error/article1819665/)

...
This week a new threat has emerged for Netflix and other firms trying to leapfrog the cable companies in delivering content. Comcast Corp., the largest U.S. cable TV company, levied a charge on Level 3 Communications Inc. for content it delivers across Comcast’s network. Level 3 is a key partner that helps Netflix stream programming.

Level 3 said it will complain to U.S. regulators on the grounds the fee violates net-neutrality rules, but some analysts have warned that if the fees do stand, Netflix could be forced to pass them on to customers.


ETA: A link (http://mediadecoder.blogs.nytimes.com/2010/11/29/netflix-partner-says-comcast-toll-threatens-online-video-delivery/) to a more detail story about this

[Keep It Real, Yo]

The next ten years are going to be interesting. If it weren't for sports I'd consider dropping cable completely.

[Rickson]

It will indeed be interesting.

We'll lose any and all appearance of freedumb of the web.

As margins get squeezed and people seek cheaper alternatives these pissing matches will get out of control. Don't worry, I'm sure the gov't will save us all.

[Blue Man]

Wireless internet is here. The days of cable TV monopolies are over. They can try whatever they want, but they'll only lose market share.

[Fish Actuary]

Wireless internet is here. The days of cable TV monopolies are over. They can try whatever they want, but they'll only lose market share.

I'm not sure. It looks like Comcast has determined that using blackmail will allow them to maintain their market share. They can basically jack up the rates until they wipe out their competitors. It's not like there's a lot of competition for broadband internet providers in a lot of cities. It requires a massive investment in infrastructure for competitors to move in. How many of those city wide wireless internet networks that were being discussed a few years ago have been built?

[Once It Hits Your Lips]

4G works fine, just tether to your computer

[Len Myers]

I'm not sure. It looks like Comcast has determined that using blackmail will allow them to maintain their market share. They can basically jack up the rates until they wipe out their competitors. It's not like there's a lot of competition for broadband internet providers in a lot of cities. It requires a massive investment in infrastructure for competitors to move in. How many of those city wide wireless internet networks that were being discussed a few years ago have been built?

If Fios weren't building everywhere, I might agree with you.

[Incredible Hulctuary]

If Fios weren't building everywhere, I might agree with you.
FiOS is far from everywhere. And they are building on their phone infrastructure, which makes it a lot easier than for a new competitor without that in place.

[Fish Actuary]

If Fios weren't building everywhere, I might agree with you.

I'm sure AT&T and Verizon will hop on the blackmailing bandwagon if they see Comcast having any luck with it.

[Incredible Hulctuary]

Comcast is apparently demanding that Netflix via one of it's service providers, Level 3, needs to pay them to have their content delivered to customers. I'm curious as to what others think on this?

This is the kind of crap that Net Neutrality is supposed to prevent. Without such legislation, in time there will be more of it, regardless of who is providing your Internet service.

Say you switch from Comcast to Verizon because they're blocking or throttle traffic from Netflix due to them not agreeing to pay the additional fees to Comcast. Guess what, Verizon blocks or cripples the phone calls you're making with Skype or Vonage. So you switch to Time Warner Internet ... and they block or cripple Hulu because it displays so many shows from their competitors.

As long as the Internet providers are tied up in other kinds of business, they will have incentives to block or throttle content from certain sources, or to demand extra fees from the sources in order to lift the blocking or throttling.

[2pac Shakur]

I don't care who it is, I just want someone to show me my Sunday beer commercials.
And big truck commercials. If you don't drink American beer and drive a truck big enough to pull up a stump, you are a big p*ssy.

[Atropellador]

This is the kind of crap that Net Neutrality is supposed to prevent. Without such legislation, in time there will be more of it, regardless of who is providing your Internet service.

Say you switch from Comcast to Verizon because they're blocking or throttle traffic from Netflix due to them not agreeing to pay the additional fees to Comcast. Guess what, Verizon blocks or cripples the phone calls you're making with Skype or Vonage. So you switch to Time Warner Internet ... and they block or cripple Hulu because it displays so many shows from their competitors.

As long as the Internet providers are tied up in other kinds of business, they will have incentives to block or throttle content from certain sources, or to demand extra fees from the sources in order to lift the blocking or throttling.:iatp:

[MountainHawk]

If Fios weren't building everywhere, I might agree with you.
Fios has stop building infrastructure, haven't they? I thought the expansion was on hiatus until 2012 or so.

[JUICE]

This is the kind of crap that Net Neutrality is supposed to prevent. Without such legislation, in time there will be more of it, regardless of who is providing your Internet service.

Say you switch from Comcast to Verizon because they're blocking or throttle traffic from Netflix due to them not agreeing to pay the additional fees to Comcast. Guess what, Verizon blocks or cripples the phone calls you're making with Skype or Vonage. So you switch to Time Warner Internet ... and they block or cripple Hulu because it displays so many shows from their competitors.

As long as the Internet providers are tied up in other kinds of business, they will have incentives to block or throttle content from certain sources, or to demand extra fees from the sources in order to lift the blocking or throttling.

This is capitalism. Do you disapprove of capitalism?

[independent]

This is the kind of crap that Net Neutrality is supposed to prevent. Without such legislation, in time there will be more of it, regardless of who is providing your Internet service.

Say you switch from Comcast to Verizon because they're blocking or throttle traffic from Netflix due to them not agreeing to pay the additional fees to Comcast. Guess what, Verizon blocks or cripples the phone calls you're making with Skype or Vonage. So you switch to Time Warner Internet ... and they block or cripple Hulu because it displays so many shows from their competitors.

As long as the Internet providers are tied up in other kinds of business, they will have incentives to block or throttle content from certain sources, or to demand extra fees from the sources in order to lift the blocking or throttling.
:iatp:

[MightySchoop]

This is capitalism. Do you disapprove of capitalism?

I don't disapprove of capitalism, but if this kind of crap keeps up, some company will just provide a "big dumb pipe" and steal market share from the others.

[erosewater]

This is capitalism. Do you disapprove of capitalism?

US telecom is very far from capitalism.

[Incredible Hulctuary]

This is capitalism. Do you disapprove of capitalism?

I disapprove of all -isms.

[Gary Wright]

Wireless internet is here. The days of cable TV monopolies are over. They can try whatever they want, but they'll only lose market share.

Don't discount their ability to fund legislative requirements on a state basis.

[Rickson]

I disapprove of all -isms.

Man...you must be lonely: Organisms

[Loner]

Fios has stop building infrastructure, haven't they? I thought the expansion was on hiatus until 2012 or so.

It annoys me to no end that I live in Jersey where the phone company was freaking BORN, and still can't get FiOS.

[erosewater]

I have severe FIOS-envy, and there are no plans to get it here any time soon

[NotUrAvgXBar]

It annoys me to no end that I live in Jersey where the phone company was freaking BORN, and still can't get FiOS.

They have fios in jersey. Maybe just not where you live.

[independent]

This is capitalism. Do you disapprove of capitalism?

Capitalism works fine when it operates in efficient markets. IH is talking about a market inefficiency.

[JUICE]

Capitalism works fine when it operates in efficient markets.

Give me an example of a truly equilibratory efficient market and I'll show you unicorns, leprechauns, and gnomes.

People are too consumed by the idea of money to be rational about it.

[independent]

Sure, the perfect market is an economic abstraction, like the perfect circle is a geometric abstraction. Some real markets are closer than others. The market for local cable is unusually far from perfect.

[Incredible Hulctuary]

FCC votes to establish Net Neutrality regulations, Netflix stock goes up 4.6%, Telecoms plan legal challenges, Republicans plan legislation to undo the regulations.

http://online.wsj.com/article/BT-CO-20101221-712057.html

[Len Myers]

I like Glenn Reynold's response (http://pajamasmedia.com/instapundit/111840/). How about we abolish the FCC.

I don't see any reason for the federal government to regulate non-broadcast media.

[notreallyme]

This is the kind of crap that Net Neutrality is supposed to prevent. Without such legislation, in time there will be more of it, regardless of who is providing your Internet service.

Looks like this passed, this IS the type of regulation I agree with.

[notreallyme]

US telecom is very far from capitalism.

Thank you.

I'm amazed at how many people confuse this seemingly obvious point.

[Incredible Hulctuary]

I wanted to reach through the TV and slap Mitch McConnell yesterday. He was going on ignorant ramblings about how this regulation is the Obama administration's way of controlling how you use the internet.

At least the Republicans won't be able to undo this legislatively for the next 2 years. They'll have to resort to the courts, saying that the FCC doesn't have this authority (they can't won't get the courts to agree the Federal government in general doesn't have the authority, as hardly anything is more interstate than internet infrastructure).

[notreallyme]

I wanted to reach through the TV and slap Mitch McConnell yesterday. He was going on ignorant ramblings about how this regulation is the Obama administration's way of controlling how you use the internet.

At least the Republicans won't be able to undo this legislatively for the next 2 years. They'll have to resort to the courts, saying that the FCC doesn't have this authority (they can't won't get the courts to agree the Federal government in general doesn't have the authority, as hardly anything is more interstate than internet infrastructure).

I almost always want to reach through the TV and slap politicians, R's and / or D's.

I'm starting to get on board with IH that something needs to be done about Corporations.

And I am definetely starting to think we'd be MUCH better off closing every bank in the US and going to CU's. Though I'd have to think this through more.

[Aaron Brachowitz]

If you don't drink American beer and drive a truck big enough to pull up a stump, you are a big p*ssy.
I haven't quite figured out the mentality of driving an F350 to the parking garage of the (stump-free) financial services company where I work, but it's quite common here.

[Incredible Hulctuary]

Republicans in the House Energy and Commerce Committee voted to kill Net Neutrality.

Fortunately, the Senate has a say and they're unlikely to agree to do the same.

http://www.pcworld.idg.com.au/article/379330/house_subcommittee_votes_kill_net_neutrality/

[Incredible Hulctuary]

Wow, a conservative with intelligence!

Why Conservatives Should Support Net Neutrality (http://prelator.wordpress.com/2009/09/23/why-conservatives-should-support-net-neutrality/)