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AT&T Exec Calls Netflix "Arrogant" For Expecting Net Neutrality 466

jayp00001 (267507) writes "'As we all know, there is no free lunch, and there’s also no cost-free delivery of streaming movies. Someone has to pay that cost. Mr. Hastings' arrogant proposition is that everyone else should pay but Netflix. That may be a nice deal if he can get it. But it's not how the Internet, or telecommunication for that matter, has ever worked,' writes AT&T Senior Executive Vice President of Legislative Affairs, James Cicconi. Mr. Cicconi took issue with a blog post from Netflix CEO Reed Hastings on the importance of net neutrality.
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AT&T Exec Calls Netflix "Arrogant" For Expecting Net Neutrality

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  • Not how it works? (Score:3, Interesting)

    by sqorbit ( 3387991 ) on Monday March 24, 2014 @04:04PM (#46567085)
    "But it's not how the Internet, or telecommunication for that matter, has ever worked,' Hasn't that how the internet has been? If someone calls me to play a song they wrote over the phone should they pay a fee to provide me that entertainment over the phone?
  • by hawguy ( 1600213 ) on Monday March 24, 2014 @04:14PM (#46567251)

    Netflix should charge back whatever fees they pay to Comcast back to their customers that view content via Comcast. This lets the customer see the true cost of their ISP.

    Why should users of Google and other ISPs that don't charge fees to Netflix subsidize Comcast subscribers?

  • by Average ( 648 ) on Monday March 24, 2014 @04:35PM (#46567477)

    Google Fiber, meet Netflix. Netflix, Google Fiber. Amazon Web Services, you in? Apple?

    It's time to start more overbuilding. Yes, it's expensive. Yes, Comcast or whoever already has the lines and could bump up to 300Mb plans for $50 at almost no additional cost (making them hard to compete against). But, until you build (and build at a much faster rate than the current Google Fiber projects), this is only going to get worse. You're currently dependent on not just a quasi-monopolist monster, but a wounded and irrational monster (because their TV profits are hurting). You have to bypass them.

    It's ugly, I know. There will be communities with roadblocks (overbuilding is supposedly legal everywhere since the Telecom Act of 1996, but reality isn't so pretty). Sad, but true. We'll end up bypassing those communities, too. In every community that welcomes you, BUILD. Fiber is nice, but if you have to go DOCSIS/HFC (fiber to the block/neighborhood) with a better upstream split frequency because of cost, build that... coax is under-rated. But build. You can train high school students to lay coax. You can leverage massive discounts for buying 30 million identical ONUs. Build. Please. For the good of the country and the internet.

  • by Anonymous Coward on Monday March 24, 2014 @04:48PM (#46567669)

    No they won't. This government belongs to them not you. Best you remember that.

  • by OneAhead ( 1495535 ) on Monday March 24, 2014 @04:50PM (#46567695)
    I'm not sure this is what you and GP are alluding to, but the elephant in the room here is the "metered internet" option. You know, like you get a higher electric bill if you use more electricity, a higher water bill if you use more water, like you used to get a higher phone bill if you would make more phone calls, and like the ISPs have higher costs if their customers consume more bandwidth. Ironically, a lot of US customers are vehemently against metered Internet, even though the current system amounts to some form of "socialism", and metered internet would be fairer and would arguably allow for more competition between providers, making internet cheaper for everyone except the few % bandwidth hogs. Incidentally, metered internet would also defeat all those whiny dissonant anti-net-neutrality arguments the ISPs are making.
  • by PortHaven ( 242123 ) on Monday March 24, 2014 @04:53PM (#46567755) Homepage

    Netflix announces that Comcast customer's (and only Comcast customer's) rates will go up $2/month.

  • by bferrell ( 253291 ) on Monday March 24, 2014 @04:59PM (#46567849) Homepage Journal

    This same sort of thinking is what brought about the interstate commerce commission rules for railroads.

    They though that if you made more the carrier should too.

    The government slapped the carriers once before (railroads). It's time to slap the telecom carriers too

  • by NIK282000 ( 737852 ) on Monday March 24, 2014 @05:06PM (#46567951) Homepage Journal

    You mean like right now? You don't get rich by working hard. You get rich by being born rich, by fucking over other people, by being really lucky or by being REALLY fucking smart. Of all of those cases only one of them involves hard work and not many people are born smart enough to come up with a real money making idea.

  • by phayes ( 202222 ) on Monday March 24, 2014 @05:07PM (#46567967) Homepage

    AT&T keeps saying that Netflix, which is the company that most of their clients are paying more to get faster Internet access to, has to pay more because Netflix sends more data than they receive.

    It's funny but I've never seen a single AT&T statement that they should be paying money to blackblaze, crashplan, & the other cloud backup providers. It's strangely hypocritical because AT&T is clearly sending a lopsided amount of traffic to the cloud backup providers.

  • by kasperd ( 592156 ) on Monday March 24, 2014 @05:16PM (#46568115) Homepage Journal

    metered internet would be fairer

    The problem is that you do not have complete control over what amount of traffic flows over your line. Paying according to the amount of traffic which other parties could be driving up, is not an acceptable situation to most customers.

  • by Trepidity ( 597 ) <delirium-slashdot.hackish@org> on Monday March 24, 2014 @05:26PM (#46568251)

    On U.S. mobiles phones, interestingly, both sides pay.

    On European mobile phones, on the other hand, only the caller pays, but they pay a non-neutral rate, which varies depending on the type of device the recipient has: calling mobile phones is more expensive (in some countries, much more expensive) than calling landlines.

  • by schnell ( 163007 ) <me.schnell@net> on Monday March 24, 2014 @06:01PM (#46568723) Homepage

    NetFlix using a Tier 3 provider would resell AT&T, who would charge the Tier 3 provider for bandwidth, which would essentially charge NetFlix for bandwidth

    Kinda sorta. Here's the problem which makes the situation a little more nuanced than it appears at first. Think of this more like one of those occasional disputes you see where "DirecTV stops carrying ESPN because ESPN jacked up their rates" or something like that. One side wants to pay less, the other side wants to charge more, and it's tough to easily pick out who the good guys and bad guys are in that kind of situation.

    Netflix buys most of their bandwidth from Cogent. Cogent has historically been the Wal-Mart of bandwidth - they sell dirt cheap but scrimp on quality to do it. The Tier 1 ISPs have said to Cogent, in effect, "you are not our peer. You will buy bandwidth from us rather than getting it for free," and Cogent doesn't want to pay. That constrains the bandwidth between Cogent and the Tier 1s (which Cogent is definitely not).

    Netflix has only gotten involved because, as Cogent's #1 customer, they are feeling the pinch of Cogent's bandwidth crunch. Remember, Cogent is no stranger to peering disputes [prnewswire.com]. The Tier 1s have said to Netflix, in essence, "we aren't upgrading our bandwidth to Cogent for free, and if you want your customers to have better performance you can connect to us directly instead of going through Cogent. Oh, and by the way, you're a content provider (albeit a huge one) and not our ISP peer so don't expect to get it for free, either."

    It may sound like a Net Neutrality issue, but settlement-free peering vs. purchased transit has been a contentious issue since the mid-'90s if not before, and it has always been sorted out among the ISPs rather than being regulated by the government. Peering and its market dynamics have always been one of the most sensitive topics among ISPs, but it has almost always been dealt with inside the industry without exposing its gory details to the public - just like how you rarely hear about those "cableco vs. content network" disputes even though those negotiations are always going on... you only hear about it when the crap really hits the fan.

    It's a perpetual issue that pits the Tier 1s vs. the Tier 2/3s, and always will be: the smaller ISPs want free peering of course, and the bigger ones don't want to give it away. The Tier 1s argue that they have to pay for a much larger network infrastructure than the Tier 2/3s so they are in effect subsidizing the networks of the smaller ISPs if they peer for free; the Tier 2/3s argue that they shouldn't have to pay to connect to other networks when the end result is (theoretically) better service for everyone.

    It is a dangerous and very slippery slope to cast peering as a "Net Neutrality" issue because it invites the government to stick its nose into a topic that the world's ISPs have quietly managed among themselves for many years. "Settlement-free peering for all" sounds good at first blush but creates a dangerous precedent potentially for content providers to be considered as networks. What if CNN.com decides it doesn't want to pay for bandwidth anymore and wants all the ISPs to peer with it as a network for free? What happens when bobshardwarestoreintuscaloosa.com makes the same request? Where do you draw the line? Why should any business pay for transit bandwidth when it is providing content that users want to see? You could theoretically see the whole cost of the Internet flip onto the consumer ISPs if you follow the model to its furthest conclusion.

    Another side note - it's not entirely true that "subscribers pay for their Internet, and content providers pay for their hosting." Larger ISPs factor in the revenue of paid transit to their business model - and they *always* have, since the earliest days of the commercial Internet - so that is in effect

  • by DamnOregonian ( 963763 ) on Monday March 24, 2014 @06:18PM (#46568909)
    Netflix has vast peering arrangements. My company peers with them for our residential customers. It's the only way you can get "SuperHD" content.
    I suspect what's going on here, is that ATT's customers are pressuring them for SuperHD (peering-only) content, and NetFlix is saying to ATT: "Sure, just peer with us, and they can have it!"
    I suspect that ATT is pissed that they would be forced to peer freely with a mere content provider (as well as perhaps lost revenue for any other lopsided peering arrangements the traffic may transit to get to ATT), and are telling Netflix that if they want to enable the chunk of their customers on ATT to have the higher-bandwidth content, the Netflix can pay ATT for the peering link.
  • by postbigbang ( 761081 ) on Monday March 24, 2014 @06:28PM (#46569041)

    This isn't telephony. It's a data communications issue, upon which rides both time-sensitive data (audio, video) and non-time sensitive data. AT&T's arrogance is that of Southwestern Bell's (remember, this is not the AT&T of old) vision for profits.

    It's a monopolistic view. It's the old "we own the highway" versus "we gave you rights of way because you were a municipal and regional utility". I say we reclaim the rights of way, and meter AT&T for their belligerence. That'll fix it for everyone.

  • by DamnOregonian ( 963763 ) on Monday March 24, 2014 @06:40PM (#46569157)
    I'm the senior network engineer at an ISP. Your assertion of no-cost is utterly incorrect.
    Here in the Seattle area, cross-connects typically happen at the Westin building. I assure you it's plenty expensive for cross-connects before you even factor in equipment (multiple 10Gbit optics and line-card ports).

    The issue is actually that ATT wants Netflix to go chew cud in response to Netflix saying "You should peer with us for free."
    http://www.reuters.com/article... [reuters.com]

    "“Netflix believes strong net neutrality is critical, but in the near term we will in cases pay the toll to the powerful ISPs to protect our consumer experience. When we do so, we don’t pay for priority access against competitors, just for interconnection,” he wrote, in relation to the ongoing debate over the future of net neutrality and paid agreements between Netflix and Comcast."

    You're being caught up as sheep in a war between capitalist organizations. This isn't even an issue of net neutrality.
    ATT isn't asking Netflix to pay for traffic transited into their network.

    "In his original post, Hastings said internet service providers should give content companies adequate network connections for free, and singled out Comcast for supporting "weak" internet traffic rules."

    Regardless of your *opinion* on costs, forcing an ISP to interconnect with someone else is *not* net neutrality. Net neutrality is simply the buzz-word being used by the combatants to rally their supporters.
  • by ClickOnThis ( 137803 ) on Monday March 24, 2014 @08:42PM (#46570139) Journal

    It seems the postal analogy is better than the car analogy.

    At one time (19th century?) when you mailed an international letter, you might have to affix postage for all the countries the letter went through. Not any more. [wikipedia.org]

    In effect, AT&T is trying to make Netflix pay for "stamps" to send "letters" into their system, even though most other "letter-senders" don't have to. (Of course, AT&T already charges its customers to receive the "letters" so whatup.)

    But really I think AT&T is trying to set up its own cyber-fiefdom, and charge "import duties" to competing content-providers like Netflix.

Things equal to nothing else are equal to each other.