The inside story of how Netflix came to pay Comcast for internet traffic

Netflix lawyers just delivered this document to the FCC, arguing against Comcast’s proposed acquisition of Time Warner Cable. From the document:

Netflix attempted to address congested routes into Comcast by purchasing all available transit capacity from transit providers that did not pay access fees to Comcast—which involved agreements with Cogent, Level 3, NTT, TeliaSonera, Tata, and X0 Communications. Although all six of those providers sold transit to the entire Internet, only three of them—Cogent, Level 3, and Tata—had direct connections to Comcast’s network.

In 2013, congestion on Cogent’s and Level 3’s routes into Comcast’s network steadily increased, reaching a level where it began to affect the performance of Netflix streaming for Comcast’s subscribers. When Netflix approached Comcast regarding the lack of uncongested settlement-free routes available to its network, Comcast suggested that Netflix return to using CDNs, which Comcast could charge access fees that would then be passed on to Netflix, or use a Tier 1 network like which charged its own access fees. Comcast made clear that Netflix would have to pay Comcast an access fee if Netflix wanted to directly connect with Comcast or use third-party CDNs. In essence, Comcast sought to meter Netflix traffic requested by Comcast’s broadband subscribers.

Is it any wonder Comcast and Time Warner are the most hated companies in the US?