Verizon Public Policy on Netflix

Sat Jul 12 22:19:59 UTC 2014

On 7/11/2014 11:38 AM, Miles Fidelman wrote:
>
> Well... if you make a phone call to a rural area, or a 3rd world 
> country, with a horrible system, is it your telco's responsibility to 
> go out there and fix it?
>
> One might answer, "of course not."  It's a legitimate position, and by 
> this argument, Netflix should be paying for bigger pipes.
>
> Then again, I've often argued that the "universal service fund" used 
> to subsidize rural carriers - which the large telcos always scream 
> about - is legitimate, because when we pick up the phone and "dial," 
> we're paying for the ability to reach people, not just empty 
> dial-tone.  This is also legitimate, and by this argument, Verizon 
> should be paying to improve service out to Netflix.
>
If you're a competitor to the monopoly then you don't get access to 
those funds.  It sucks for you, but that's just how it works.  The 
county/state government has determined that they need to pay someone to 
make their network better in that region.  They chose to pay the 
monopoly (whoever that is) and it wasn't you.

It's the monopolies job to ensure good connectivity to Netflix.  Oh, the 
monopoly is Comcast and they have a Netflix caching box but you don't?

That is the cost of doing business in a rural market.  You've got a few 
choices.  Build out a fiber backbone to larger or more diverse markets, 
buy more transit, or go out of business.

I service customers in small markets.  Frequently they've got 
underpowered circuits because the incumbent won't sell MetroE or charges 
astronomical amounts for everything.  If those were my only customers 
I'm not sure what I would do because I don't like their networks.  I 
want to upgrade them but I'm being held back by various things.  I've 
had situations where <Monopoly> entered a building at my expense to 
provide me fiber service so I could upgrade the users speed, then use 
that new fiber to undercut me on prices and take all the customers.

People say the exclusive agreements for multi-dwelling units were bad 
for the little guy, but the truth is that the little guy could use 
exclusive agreements to allow the community to collective bargain for 
better internet.

Now that those are gone, the competition is who can bribe the property 
manager more in pay-per-home connect fees.

> Either way, if one is a customer of both, one will end up paying for 
> the infrastructure - it's more about gorillas fighting, which bill it 
> shows up on, who ends up pocketing more of the profits, and how many 
> negative side-effects result.
>
No, it isn't.  It's about monopolies telling a large company that isn't 
a monopoly that they need to pay them money to stay in business.

> Methinks all of the arguments and finger-pointing need to be 
> recognized as being mostly posturing for position.
>
> Miles Fidelman
>