Netflix to Pay AT&T for High-Quality Video Streaming Connections


Netflix has struck a deal with AT&T, under which the No. 1 Internet video-streaming company will pay the U.S.’s biggest phone company fees to guarantee high-quality delivery.

The deal represents the third major U.S. broadband provider Netflix has cut such a deal with, after Comcast and Verizon Communications.

“We reached an interconnect agreement with AT&T in May and since then have been working together to provision additional interconnect capacity to improve the viewing experience of our mutual subscribers,” Netflix chief communications officer Jonathan Friedland said in an email. “We’re now beginning to turn up the connections, a process that should be complete in the coming days.” AT&T issued a similar statement.

SEE ALSO: FCC Looks at Why Netflix Subscribers Are Getting Poor Signals From ISPs

Netflix has objected to paying ISPs these kinds of interconnection fees, arguing that they’re tantamount to arbitrary “tolls” for gaining access to a provider’s customers — and advocating for a “strong” form of net neutrality. The company has lobbied the Federal Communications Commission to reclassify broadband as a telecommunications service, which would give the agency authority to impose new price controls and enact other regulations.

Comcast and Verizon have said that paid-peering deals like the ones they have with Netflix are par for the course, and a standard way the Internet bandwidth market works. The ISPs contend that that Netflix — which represents upwards of one-third of downstream broadband traffic during peak periods — is seeking to avoid paying its fair share for the cost of delivering video over the Internet.

The pact between AT&T and Netflix was first reported by Mashable.

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  1. Kane says:

    I don’t see how any of this is Netflix’s fault. The customers are already paying for the data they are using. If AT&T needs to update their infrastructure then that is their problem. Netflix is just an online service, not an ISP, they have no control over what type of infrastructure their customers are trying to access. That is like having a website and then having to pay AT&T for people to access your website. I hope AT&T gets what’s coming to them for just bullying all these companies into giving them money that their customers are already giving them. And I hope the FCC denies their DirecTV merger. (AT&T customer for 7 years)

  2. Jake says:

    “Netflix has struck a deal with AT&T, under which the No. 1 Internet video-streaming company will pay the U.S.’s biggest phone company fees to guarantee high-quality delivery.”

    Translation: Netflix SUBSCRIBERS can expect fee increases to pay for this.

  3. Dan says:

    This is as wrong as it gets. God bless corporate America..

  4. jedi77 says:

    Isn’t it strange how something that seems so logical and a no-brainer, needs to be stated, petitioned and argued for?
    How can you be opposed to net neutrality?

    The need for these deals should be consumer responsibility. If I, as a consumer, feel that I am not getting the connection I am paying for, then I should complain til my ISP. If all consumers did this, Netflix wouldn’t have to fork out hundreds of milions of dollars.

    That being said, I will give Internet providers a grudging note of agreement.

    Say you have 10 users with a 20/2 connection. They all surf the net and watch cute cats on Youtube. They spend maybe 3 og 4 of their 20. That is fine.
    But when the 10 users all watch HD movies on Netflix at the same time, they all use maybe 10-15 of their 20. And yes, that is what they pay for(!) – but I could easily imagine that Comcast’s/AT&T’s connections aren’t built for a situation where all their users are using all the internet all the time at the same time. Therefore they have expenses redesigning and updating their infrastructure.

    Granted, that is their own problem, they sold the users the connections in the first place, but a small part of me actually sees where they’re comming from in wanting Netflix to chip in.

    And I love my Netflix!

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