Netflix, Comcast reach streaming deal

Netflix and Comcast have reached a deal that will give the online video service better access to Comcast subscribers, according to The Wall Street Journal.

Through the deal, Netflix will pay Comcast an undisclosed amount to connect directly to its servers, which should improve video streaming quality for Netflix subscribers who access the site through a Comcast connection, according to the report.

The deal is a move away from Netflix's previous model, which relied on Internet middlemen to connect the video service to Internet providers' subscribers.


Netflix had wanted to connect directly to Internet providers' service for free, but the deal with Comcast will likely lead to similar paid arrangements with other Internet providers, according to the report.

In a statement, the companies said the deal is "already delivering an even better user experience to consumers, while also allowing for future growth in Netflix traffic."

The announced deal comes right after Comcast announced its plan to buy Time Warner Cable, a deal that would combine the top two cable Internet providers in the country, earlier this month. If it survives regulatory scrutiny, that deal would expand Comcast's commitments to not block or slow down Internet traffic for profit — a commitment the company made when it merged with NBC Universal in 2011 — to Time Warner Cable's 8 million subscribers.

The interconnection deal between Comcast and Netflix also comes on the heels of a federal court's decision to overturn the Federal Communications Commission's net neutrality rules, which prevented Internet providers from blocking or slowing access to certain websites.

While the agency's rules didn't address interconnection deals like this one, FCC Chairman Tom Wheeler announced last week the agency would be rewriting the rules under a broader authority over broadband companies outlined by the federal court that struck down the original rules.

Public interest advocates are calling on Wheeler's agency and other regulators to keep an eye on interconnections deals like the one between Comcast and Netflix.

John Bergmayer, Public Knowledge senior staff attorney, called on the FCC, the Department of Justice and members of Congress "to ensure that the broadband market continues to meet the needs of its users and allows companies like Netflix (and the next Netflix) to offer the services that users have demonstrated they want."

In a statement, Bergmayer pointed to the "opacity" of the deals between Internet providers and content companies. "No one on the outside knows what is happening in this market," he said.

Bergmayer also said the deal between Comcast and Netflix demonstrates the ability of large Internet providers to pressure content providers like Netflix, which "raises concerns in light of the proposed Comcast/Time Warner Cable merger."