Is Netflix now being less generous?

Is Netflix now being less generous?

The fast internet streaming service, Netflix seems to take note of its free available videos and has begun to cut down on this. The service provider has reduced the speed of the videos which are watched by the users on AT&T and Verizon. It deliberately wants to protect its business from any kind of encroachment.

Days after the mid-term elections, the President posted a video strongly advocating his own “plan” for net neutrality rules, upping the volume on this year’s loud, confusing, and often intentionally misdirected debate on how best to maintain the open Internet.

The FCC, which by law is independent of the White House, has been considering new rules since a federal appeals court in January largely voided on jurisdictional grounds an earlier effort from 2010. In May, based on guidance from the court, the agency proposed a revised version that differed only slightly from the 2010 rules.

In the meantime, the FCC’s proceeding has been overshadowed by a frenzied media circus that casts the agency, and Chairman Wheeler, as conspirators in a plot to destroy the Internet.

Now, unrefuted evidence has emerged that the unraveling FCC proceeding, almost certain to land the agency back in court for a third time, initially spun out of control based on wildly misread data on early 2014 network performance issues—an error that at least one leading industry analyst suspects may not have been accidental.

The Plot Thickens

The story begins back in March, when the strictly legal debate over the FCC’s limited authority over broadband ISPs first turned toxic with inflammatory statements from Netflix CEO Reed Hastings on the company’s blog.

The 2010 rules, even if reinstated, were too “weak,” Hastings wrote. “A stronger form of net neutrality is required,” he insisted, to “prevent ISPs from charging a toll for interconnection to services like Netflix” and other dominant content providers. To protect the Internet, he wrote, the FCC must force ISPS to provide Netflix “sufficient access to their network without charge.”

At the time, Netflix was concluding a series of agreements with leading ISPS to directly interconnect Netflix’s proprietary content delivery technology with their networks, as other large content providers had long done. Before that, and to keep up with rapid growth, Netflix has been paying third-party transit providers including Cogent and Level 3 and general purpose content delivery networks, which are provided by companies such as Akamai and Limelight.

Hastings, dissatisfied with the negotiations, urged the FCC to redefine net neutrality, transforming it from a set of last-mile consumer protections to detailed government control of connections at the Internet’s back-end. Rather than pay the transit providers, Netflix wanted to connect directly to the ISPs and do so “without charge.”

And Hastings demanded that the FCC make such arrangements a matter of federal law.

To emphasize the need for FCC oversight, Hastings insisted that ISPs were intentionally “constraining” Netflix traffic to force the company to upgrade its connections, “sacrific[ing] the interests of their own customers to press Netflix and others to pay.” (Netflix did not respond to requests for comments on this story.)

That claim quickly upended the on-going FCC proceeding. Soon after, comedian John Oliver launched his satirical tirade against cable company interference with Internet traffic, prominently featuring the Netflix-supplied data.

Comments began flooding into the FCC’s pending Open Internet proceeding, derailing efforts by Wheeler to respond quickly, as he promised, to the appeals court’s “invitation” to clear up the few remaining issues with the on-going rulemaking and move on to more urgent work.

But Netflix had fatally misread the data.

Earlier this month, Frost & Sullivan’s Dan Rayburn, a leading media industry analyst, reported damning evidence that Hastings’s claims of ISPs throttling were untrue all along, based on a fundamental misidentification of the cause of measurable traffic congestion being experienced at the time across the Internet.

There was intentional throttling going on, Rayburn reports. But it was not being done, as Netflix claimed, by Comcast or other large ISPs, intentionally or otherwise.

The congestion, rather, resulted from a calculated choice made by Cogent, Netflix’s own Internet transit provider. Cogent, it turns out, had implemented a practice of prioritizing the traffic of its retail customers over that of its wholesale customers, including Netflix, during times of heavy network usage that strained Cogent’s capacity to deliver the traffic being pulled by end-users.

Faced with irrefutable evidence reported by Rayburn and others, Cogent quickly admitted to intentionally slowing the traffic of all its wholesale customers, a practice that may still be in place.

Cogent explained in a blog post that “retail customers were favored because they tend to use applications…that are most sensitive to congestion” and that in response they implanted a “structure” that “impacts interconnections during the time they are congested.”

According to Rayburn, Cogent never publicly disclosed that it was intentionally prioritizing outgoing traffic of its retail customers, in violation of industry practice (and possible contractual responsibilities with its wholesale customers).

And its own policy: Cogent’s website proudly proclaims “Cogent practices net neutrality. We do not prioritize packet transmissions on the basis of the content of the packet, the customer or network that is the source of the packet, or the customer or network that is the recipient of the packet.”

The failure to disclose the practice even as the FCC proceeding spun out of control because of it was particularly damaging. As Rayburn notes, “What Cogent did is considered a form of network management and was done without them disclosing it, even though it was the direct cause of many of the earlier published congestion charts and all the current debates.”

It was Cogent’s undisclosed actions, in other words, that resulted in a widely-reported slowdown of Netflix’s outgoing Internet traffic.

The slowdown had nothing to do with the lack of enforceable net neutrality regulations. And it said nothing about the potential danger of so-called “paid prioritization” arrangements that have been the rallying cry in this round of the ten year old net neutrality debate.


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