Verizon Public Policy on Netflix

Vitkovsk√Ĺ Adam adam.vitkovsky at swan.sk
Fri Jul 11 08:32:51 UTC 2014


> -----Original Message-----
> From: NANOG [mailto:nanog-bounces at nanog.org] On Behalf Of Matthew
> Petach
> Sent: Friday, July 11, 2014 3:35 AM
>
>
> So, if Netflix had to pay additional money to get direct links to Verizon, you'd
> be OK paying an additional 50cents/month to cover those additional costs,
> right?  And when Time Warner also wants Netflix to pay for direct
> connections, you'd be ok paying an additional 50cents/month to cover those
> costs as well, right?  And another 50cents/month for the direct connections
> to Sprint?  And another 50cents/month for the direct connections to
> cablevision?  (repeat for whatever top list of eyeball networks you want to
> reference).
> 
> At what point do you draw the line and say "wait a minute, this model isn't
> scalable; if every eyeball network charges netflix to connect directly to them,
> my Netflix bill is going to be $70/month instead of $7/month, and I'm going to
> end up cancelling my subscription to them."
> 
> 
> Matt

I disagree as all of this makes perfect sense.
 
Would it be right if Netflix comes to You and says we see you've got a lot of our customers hooked up to your backbone so to serve better service we'd like to connect to your network directly. 
And you goes: so you would like to become our customer? Sure this is the monthly fee for the link and transport service that would suite your needs. 
And Netflix goes: well how about you build the link to us bearing all the costs and you gonna charge us nothing for the transport you provide, deal? 
What would be your answer? 

Of course this "good deal" has some precursors. 
If your customers fail to obey your statistical multiplexing predictions and links to your upstreams are running hot than you have several options. 
a) You could pay for the upgrades of links to your upstreams. 
b) You could take the "good deal" Netflix has proposed to save costs for a). 
c) You could not give a damn about your customers as they have nowhere else to go anyways and use this advantage to force Netflix to become your customer (well paying customer as they would need big pipes). 
What would you do?

Options a) and b) assumes of course that Netflix has good connections to their upstreams and not misusing their position into forcing the customer relationship into free peering one. 

adam













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