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FCC revising neutrality plan; Netflix follows peers higher

  • Following a public backlash, FCC chairman Tom Wheeler is backtracking a bit on rule changes (floated last month) that would allow U.S. ISPs to charge content providers for access to a priority "fast lane."
  • A new draft of Wheeler's plan seeks comment on whether such arrangements, referred to as "paid prioritization," should be banned. It also states the FCC will scrutinize deals with content providers to make sure non-payers aren't at a disadvantage, prevent ISPs from doing deals with varying terms, and (notably) seek comment on whether broadband should be regulated as a public utility.
  • Netflix (NFLX +3.2%), whose bandwidth spend accounts for a sizable portion of its expenses, is higher amid a broader Internet stock rally. The streaming giant has struck direct peering deals with Comcast and Verizon this year, but has also made it clear it's not thrilled with having to make them.
  • Cogent (CCOI +2.2%), which provides peering services for Netflix and many others, is also higher. Its shares tumbled after the Netflix-Comcast deal was announced.
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Comments (7)
  • Siwanoy
    , contributor
    Comments (717) | Send Message
     
    Sounds like no back track, but more like a plea to tech companies to open the back door so he can make deals -- most probably on behalf of the carriers.
    12 May 2014, 11:07 AM Reply Like
  • TCG,llc
    , contributor
    Comments (421) | Send Message
     
    What happen to regulation being neutral or impartial? How is allowing preferential traffic handling for services that's already been paid for beneficial to consumers? Sounds more like ISP's need to evolve rather than allowing a double charge for services prioritization.
    12 May 2014, 12:21 PM Reply Like
  • th3decider
    , contributor
    Comments (428) | Send Message
     
    "Evolve" would mean ISPs finally charging fixed-line customers metered internet access so those who use more pay more, like the rest of the world does. It is how we charge for mobile phone data access and pretty much every other good in existence: customers who use more pay more, simple. When you arent allowed to charge one customer more who uses 100 time as much of a product as the next customer, then you are going run into problems like this, and the company is forced to then try and charge a proxy, like the content firms those high usage customers use (netflix), as a substitute, or engage in "network traffic management." And then we run into all the problems we have today.

     

    But since everyone and their mom has it in their heads that 1080p HD streaming quality video and the internet infrastructure needed to support it is now a basic human right that should be free and/or available at the same flat rate to everyone, regardless if they use 10gb a month or a terrabyte a month, I expect no common-sense solutions anytime soon.
    12 May 2014, 04:15 PM Reply Like
  • TCG,llc
    , contributor
    Comments (421) | Send Message
     
    Obvious distortions of the truth....I worked in networking for 16 years as a Network Engineer up to the Tier-3 level of tech support both international and domestic Frame-relay/ATM/VPN/In... Private line, MPLS and supervisor within Ethernet (Metro Ethernet & Opteman). In addition, my company initiated a project BOG (Building Out Globally) from a home using AT&T DSL, Comcast and a T-1 from Windstream to test data-streaming capabilities for a duration of 1 year.

     

    First, each customer that signs up for services is allotted a certain amount of BW for the month. Some carriers allot a customer 150GB per month and others 250GB for either DSL or cable respectively. As we know, a T-1 (1.544 mb delivery rate) is private line service which offers an SLA for each customer with associated penalties for up times generally around 98-99% (3 sigma level). Regardless of the traffic type, traffic is treated as data where the data-streaming company or content provider will provide its own algorithm to treat the traffic compensating for a lack of COS (class of service) or Qos (quality of service) by the ISP. Customers pay for BW monthly and if they go over the allotment they are charged anyway by the ISP $10 for each additional 50GB. So what happens if the customer doesn't use wifi or stream via any of the content providers like Netflix, Hulu plus or Amazon? Do the ISPs give rebate? Absolutely not....so the metered rate does not happen....Prior to the advent of the data streaming companies the ISP's didn't care about how customers used this allocated BW as their was no vehicle for consumers to make use of what they paid for until now....Normally, traffic by business customers is treated per contract...as either data, video or voice, either streaming or real-time application where the carrier offers COS or QoS using diff-service code points or other traffic markers. The real problem for ISP's is that data streaming by the public upsets the capacity management schemes where there's never really been enough BW for use by the consumer as many ISP's have engaged in oversubscription of network services...Carriers are just upset that content providers are raking in huge profits off of BW services which were packaged within home services that they sold to the public that often sat unused by consumers. Carriers just never anticipated or planned for this scenario and were just "banked" on a continuation of the norm where ISPs would continue packaging services to consumers at no risk to the business marketing plan and services that were considered easy money. So, are you now getting the picture....I have more but for the sake of brevity....I'll quit...for now...
    12 May 2014, 06:48 PM Reply Like
  • th3decider
    , contributor
    Comments (428) | Send Message
     
    "First, each customer that signs up for services is allotted a certain amount of BW for the month. "

     

    No they dont your info is like 10 years out of date. You are distorting the truth not me. I have comcast. I routinely go over the 250gb limit and it even says on my account that the limit is "not enforced." A limit not enforced = unlimited.

     

    Why people can accept paying for metered data on their cell phones, metered electricity, yet not metered broadband is beyond me. Hell people hold broadband to a higher standard than clean water! Even with clean water people accept metered pricing because it makes sense. If you use more you pay more, duh. If you tried to run any other business with the pricing plan of flat rate for all no matter how much of the product you use, you would also have all the problems that come with that screwed up pricing plan. Basic econ 101.
    12 May 2014, 09:27 PM Reply Like
  • TCG,llc
    , contributor
    Comments (421) | Send Message
     
    This was 6 months ago...and I have the data and the bills to prove it! The average consumer home watches 5 1/2 hrs of TV a day; our project watched 10-12hrs and consumed terabytes....so we have actually pushed those thresholds beyond the limit more so than you. So, who says that consumers were expecting unlimited BW when most are not even utilizing what they were paying for....In addition, this information is not old as it was only 6 months ago.......While you ONLY have Comcast, We had three service providers for an entire year....As far as the business model for the ISPs, I'm not in marketing and as I stated before this was the "fatal flaw" of their plan, not mine....Further proof of that ISP exec's were caught "sleeping at the wheel" comes by way of the Data Streaming companies who were able to make Billions where Netflix ultimately had to be forced to the negotiation table to make a deal. Last, what experience do you have in IT and at what level of expertise?
    13 May 2014, 07:43 AM Reply Like
  • Sakelaris
    , contributor
    Comments (2037) | Send Message
     
    The ISPs need to be careful of the public wrath over this issue. And the politicians certainly must know that Netflix and various kindred companies can send out E-mails to millions of voters identifying those politicians who are on the ISPs side in this issue.
    12 May 2014, 04:07 PM Reply Like
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