After entering into paid peering agreements with Comcast, Verizon, and AT&T, the online video streaming service Netflix has now agreed to pay Time Warner Cable for a direct connection and faster streams. TWC confirmed that the deal happened in June and the implementation has been rolling out this month.
Netflix represents about one-third of all downstream Internet traffic in North America, while the country’s top four broadband providers, with whom the streaming service now has peering arrangements, represent nearly 68 percent of all high-speed Internet subscribers.
This will be Netflix's last such deal in the US. "Just a handful of US ISPs have required these access tolls, with Time Warner being the last of the four", a company spokesperson said.
Despite the agreements, Netflix CEO Reed Hastings has been vocal about the need for strong net neutrality. In an article published on Wired today, he argued that this sort of pay-to-play system that charges both the sender and receiver for the same content, will undermine broadband's true potential.
On the other hand, companies like Comcast have been defending their paid-peering agreements with Netflix, saying this is the way the Internet bandwidth market works.
Netflix had earlier opposed Comcast's proposed $45 billion takeover of Time Warner Cable, arguing that the resulting entity would have unprecedented control over the high-speed Internet market. The company last month urged the FCC to reclassify broadband as a telecommunications service.
Although the FCC has said it's looking into these deals, it hasn't promised any regulatory action.