// Ars Technica
Netflix hates writing checks to Internet service providers—and luckily enough, it usually doesn't have to.Though the streaming video company has complained bitterly about having to pay Comcast, AT&T, Verizon, and Time Warner Cable for direct connections to their networks, Netflix said this week that worldwide, it delivers 99 percent of its traffic without money changing hands.
The statement came in a filing with the Federal Communications Commission in which Netflix asks the FCC to block Comcast's proposed acquisition of Time Warner Cable. Besides AT&T and Verizon, those are the only ISPs that refused to give Netflix the unpaid connections, known as "settlement-free peering." In the months before Netflix agreed to pay these companies, video was sent over congested links, resulting in poor performance for subscribers.
To Netflix, the fact that so few companies have the market power (i.e. size) to demand such payments is evidence that further consolidation should not be allowed. Netflix goes into its thinking in more depth than it has previously, but it's the same argument that it has made before. What's surprising is the statement that nearly all of Netflix's traffic goes over unpaid connections to ISPs, despite Netflix having to pay the four biggest in the US.
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