Netflix is currently in discussions with multiple pay-television providers in the US for the right to add their service as an app to providers' set-top boxes. Comcast and Suddenlink Communications are among those that the streaming service is holding talks with according to people familiar with the matter as reported by the Wall Street Journal.
It’s an interesting proposal as cable providers have been concerned with the idea of streaming media cutting into their customer base and revenues for years. It’s a pretty clear-cut case of conflict of interest but if a customer is already paying for a cable box, how much harm could be done? The report notes that Netflix recently inked a similar deal with UK-based Virgin Media although it still requires customers have a subscription to the service in order to use it.
One issue that’s reportedly holding up discussions is the fact that Netflix would require cable boxes to use a special streaming protocol as part of their Netflix Open Connect program. The technology is needed to improve the delivery of streaming video and would require cable operators to open their networks to Netflix’s servers.
AT&T, Comcast, Time Warner and Verizon have all rejected the idea of using the technology. Such an arrangement may prompt other companies to ask for special treatment as well and in their defense, the providers believe their networks are fully capable of taking on Netflix traffic according to sources.