Netflix Agrees to Pay Comcast to End Traffic Jam
February 24, 2014 10:00 AM
comment(s) - last by
While it's not clear how much Netflix is paying Comcast, the new deal will span several years
Comcast recently cemented its dominance as the top broadband provider in the U.S. after its planned acquisition of Time Warner Cable (TWC). And with a customer base that large, Netflix doesn't want to miss out.
, Netflix has agreed to pay the big cable provider to ensure that its movies and TV shows stream easily without traffic jams on Comcast's broadband network.
While it's not clear how much Netflix is paying Comcast,
the new deal
will span several years and Comcast said it would connect to Netflix's servers at data centers operated by other companies.
This means a less-congested streaming experience for Netflix customers using Comcast cable connections, and Comcast gets to collect fees for providing the service.
Before this agreement, Netflix wanted to connect its own specialized servers to the networks of big cable providers in order to improve streaming. But Netflix didn't want to pay for such connections, and big cable like Comcast wanted fees because they'd be
carrying Netflix's heavy traffic
So Netflix traditionally used middle companies for connections, but it had to pay these middlemen to do so anyway. There were also traffic congestion problems with this route, which slowed connections for customers. Netflix likely thought it made more sense to just give in and pay the big cable company (Comcast) for direct connections to its broadband network, and to ensure that Netflix content is delivered smoothly.
This is a big step between big cable and internet streaming companies, as it means Netflix is more likely to offer similar deals with other major cable companies.
earlier this month for $45.2 billion, serves 32 million households in the U.S. With the company having such a dominant position in the U.S. cable market, it could be a good idea for Netflix to jump onboard and please both current and potential customers with better service.
Netflix has over 30 million subscribers in the U.S.
This article is over a month old, voting and posting comments is disabled
I Don't See The Problem...
2/25/2014 12:34:45 PM
If port-peering is the issue, then bypass it completely in a way that negligibly effects consumers...
Netflix already assumes the costs for the bandwidth from/to its data centers and pays to install, maintain and upgrade them. Most ISPs offer paid hosting in their data centers.
If Netflix pays an ISP to host their content, it bypasses port-peering to the ISP's customers and takes the traffic off the internet as it never leaves the ISP's network. Netflix frees up resources it currently assigns to their data centers (including bandwidth costs) and reassigns said resources to pay the ISP.
The ISP makes a fair profit for the hosting and bandwidth. Netflix improves its services at a nominally higher cost to its customers.
As 4K content proliferates, customers pay a premium to access it.
There is usually a win-win solution to most problems. When individuals or businesses succumb to ugly greed, those win-win situations tend to evaporate.
"The whole principle [of censorship] is wrong. It's like demanding that grown men live on skim milk because the baby can't have steak." -- Robert Heinlein
Comcast Acquisition Puts Potential Netflix, TWC Deal on Hold
February 18, 2014, 9:15 AM
Market Leader Comcast to Purchase 2nd Place Time Warner Cable for $45.2B
February 13, 2014, 12:08 AM
Netflix Wants Cable Companies to Put its App on Set-Top Boxes
October 14, 2013, 5:53 PM
Google Fiber Finally Heading to Austin, Texas in December
October 16, 2014, 11:48 AM
Dropbox Flexes Security Muscle, Appears to Have Squashed Password Breach
October 15, 2014, 12:12 PM
U2’s Bono Apologizes for Forced “Songs of Innocence” Album Downloads
October 15, 2014, 7:55 AM
Google Launches "Same-day Delivery" Subscription Service for $95/year
October 14, 2014, 10:37 AM
Netflix 4K Content to Cost Subscribers Extra $3/Month
October 13, 2014, 8:01 AM
Marriott Slapped with $600k Penalty by FCC for Jamming Mobile Hotspots
October 3, 2014, 2:16 PM
Most Popular Articles
Google Announces Android 5.0 “Lollipop”, Nexus 9 Tablet, and Nexus 6 “Phablet”
October 15, 2014, 12:41 PM
Cool Science Video of the Day: Carnivorous Leech Eats Giant Jungle Worm
October 16, 2014, 6:44 PM
Oops! Apple Outs iPad mini 3, iPad Air 2 via iTunes Store
October 15, 2014, 1:32 PM
HBO, CBS Lead Charge to Ditch Cable
October 16, 2014, 4:40 PM
Google Offers $99 Nexus Player w/$40 Controller for Android Set-Top Streaming, Gaming
October 15, 2014, 3:01 PM
Latest Blog Posts
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information