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Will Netflix Doom Net Neutrality?

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For some time now, net neutrality has been a ’cause celebre’ for web geeks.

The idea – that all traffic on the internet should be treated equally, regardless of source, content or intent – is one that’s pretty compelling. It speaks to the democratic ideals of the web as a place where anyone can get their message out as long as they have access to a computer.

Yet, lately, a couple of statistics have arisen that might threaten to throw a wrench into plans for enshrining net neutrality into law.

First is that during prime time, Netflix consumes up to 20% of all bandwidth. Second is that, during that usage, it’s 2% of users who are using up all this bandwidth. This does not bode well for net neutrality.

Hogs at the Trough

clarksummit pigs feeding

The argument for net neutrality has always been that the internet should be built on the principle of fairness – in part because it’s right, and in part because, in the past, it’s been impossible to do.

See, historically, there has always been a link between how much money you have and how easy it is to wield influence, get your ideas out or start a business. This is because there was a link between physical stuff and your capacity to reach people. Want to spread the word about your new store? You needed ads in newspapers or TV. Same deal with political ideas or campaigns. Those with more money could get reach more people because the networks we distributed things on favored the wealthy. TV towers, printing presses, radio airtime – all these things weren’t cheap.

The web was supposed to change that – and it did. Because businesses like YouTube are built on spreading content regardless of its origin, it wasn’t supposed to matter who you were.

But, bandwidth isn’t an infinite resource. At any given point, there’s only so much to go around. And if Netflix is now taking up 20% of prime time bandwidth, what happens next year when they might take up 30%?

And at that point, will it be fair that governments will legislate all traffic be treated equally? When a multimillion dollar corporation like Netflix Inc. is tying up a fifth of all traffic across the web in one country? Shouldn’t ISPs get to charge Netflix more for that high-bandwidth HD video?

(Edit: some readers have pointed out that Netflix does already pay for the bandwidth it uses, and shouldn’t have to pay more for using more. I apologize for the insinuating the inverse. The question, however, is whether ISPs could charge end-users more for using Netflix, which would be the opposite of what Net Neutrality advocates are in favor of. In response to that idea, I’d venture my defense of net neutrality below still makes sense, as end-users should not have to pay more to receive certain types of content.)

Why Net Neutrality Still Makes Sense

It’s certainly a sticky issue. But here’s why net neutrality still makes sense: even if one video streaming company takes up even half of all bandwidth, this is the price we have to pay for an open web.

Here’s the thing: net neutrality, even in the form of strict government legislation, relies on the idea that it should be what people are doing online that guides the direction of the web – and that furthermore, people should be able to do whatever they want without restriction. Rather than corporate interests deciding which traffic is prioritized, faster or more widely accessible, net neutrality is the principle that when all traffic is equal, it provides the best possible chance that the internet will be a medium for free and open expression.

So, even in the face of a company like Netflix dominating traffic, net neutrality still makes sense. ISP’s will be forced to expand bandwidth requirements instead of deciding which videos, images and text are ‘worth more’ than others. More to the point, unlike the tightly controlled media of the past, a free and open internet will be available to all, equally, chipping away at the massive difference in reach and power between regular people and massive companies.

And if Netflix paying the same for bandwidth as some guy or girl down the street is how we get there, then so be it.

  1. The story is Netflix uses 20 percent of the peak bandwidth USAGE, not 20 percent of the actual available bandwidth. There is still a lot of dark fiber still out there.

  2. Buy a clue. Netflix pushes it’s traffic by way of internet exchanges like torix etc. This is transit not internet bandwidth.

    The ISP’s get it free from netflix if they want.

    Total nonsense

  3. I think part of the problem is that you’re being sold an eight meg internet pipe from your cable provider, with the understanding that you won’t use it. They sell hundreds, thousands of 8mb pipes and hook them up to a pipe that’s not 1% the total size. That’s fine when everyone is using burst speeds for occasional downloads, but it doesn’t scale to running your connection at 100% for an hour or two at primetime. They can’t afford to give you a 100% duty cycle connection at your burst speed, you couldn’t afford internet service if they did.

    One alternative would be to allow burst at 8mb, then scale back to 1mb or less. This kind of traffic shaping would be fair and neutral, since it’s a reflection of what the customer is paying for. You’d still get snappy surfing, but you’d be forced to stream down movies, not in realtime necessarily, but into a buffer at a bandwidth that would be reasonable given the uplink your provider can dedicate to you.

  4. Every business model I’ve seen with prices changed for people using MORE of a commodity has them getting a volume/bulk discount. Charging someone more per unit because they’re using more of it doesn’t make sense to me.

    Now, limiting the amount they can use because of supply and demand concerns isn’t unheard of – but that means Netflix itself would be throttled, yes? Not the users of Netflix – they’re using other things in addition to Netflix.

    Not to mention that the people not using Netflix and other media services aren’t going to be using up a lot of bandwidth, so it’s not as if they’re demanding the bandwidth that Netflix users are taking up, are they? They don’t need it. They’re watching cable.

  5. Your article contains one crucial, logical error: It’s not Netflix themselves who are using the the bandwidth; it is Netflix CUSTOMERS who are using the bandwidth. Those Netflix customers who are watching tons and tons of movies are ALREADY PAYING THE ISPs MORE for faster internet connections.

    Netflix is paying ISPs for bandwidth already as well, they’re not getting a free ride.

    Just because Netflix is popular shouldn’t mean they have to pay more for bandwidth then any other service.

  6. Its easy to say “ISP’s will be forced to expand bandwidth requirements instead of deciding which videos, images and text are ‘worth more’ than others.” being an internet consumer. However someone will have to pay for the expansion of said networks & it should not be the taxpayers. Fairness means you will need to spread that network expansion expense across all consumers or charge the ones who consume the most more money. Its not about limiting someones message its about making sure you pay for what you use. This whole concept of net neutrality just doesn’t make much since to myself. Lets say I drive a giant SUV that uses way more gas than the person that drives a prius the whole concept of net neutrality when translated to this situation means that the person driving the prius would need to be burdened due to myself that drives the SUV… Not Fair. I should have to pay more because I chose to drive the thing whereas the person in the prius “chose” to drive it. Its about what you chose to do. If you chose to slurp down 100’s of gigs a month then you should pay for it so the ISP can facilitate needed expansion. My .02cents

  7. Quote: “Shouldn’t ISPs get to charge Netflix more for that high-bandwidth HD video?”

    In short, NO!
    Netflix pays for it’s bandwidth usage already by purchasing it’s end of the connection from a tier 1 ISP (e.g. Sprint etc). This covers the transmission side of things. The actual Netflix consumer also pays an ISP for their home internet service which covers the receiving end. This already covers both ends of the connection, just like when two people talk on cellphones each carrier is deducting minutes from each of the two subscribers. The bandwidth is already fully paid for!
    Having the ISP on the consumer end charge Netflix for bandwidth which the consumer is already paying for would be charging twice for the same service.

    If the ISPs want to charge the source of the content (Netflix/Youtube/Facebook) then they need to provide FREE Internet to the end consumers.
    Alternatively, if there is a problem with a small fraction of consumers taking up the majority of bandwidth – just implement metered Internet connections where the consumer pays by bandwidth usage regardless of the source of the bandwidth.

  8. I believe the article you reference says that NetFlix usage is 20% of the bandwidth used, not – as I initially though – that they are using 20% of all available bandwidth.

    Even if NetFlix did use 20% of all available bandwidth, they would be able to do so simply because it’s available (we’re not running at 100% 24/7). If 90% of bandwidth was being consumed by other things, NetFlix users would have problems streaming their shows. They would complain to NetFlix or unsubscribe, which in turn would cause NetFlix to put pressure on the ISPs to increase their bandwidth as a whole.

    The beauty of net neutrality (the status quo) is that we’d all benefit from that increase in bandwidth, because ISPs are prevented from allocating it.

    If the net weren’t neutral, ISPs would have the ability to prioritize NetFlix traffic to the detriment of others should their demand spike.

    In short, I think we agree.

  9. Let me get this straight.

    The first arguments about bandwidth usage vs net neutrality were based on bittorrent traffic making up a large portion of the market share and hurting cable companies providing tv content.

    So, Netflix steps up to the plate and creates an amazing (and completely legal) cost-effective platform for users to gain access to content legally. But, by being successful, now they’re the main target for criticism.

    Has anybody done a feasibility study to see the amount of bandwidth that cable TV consumes vs the benefits of using that bandwidth for internet streaming…. Didn’t think so.

    This argument isn’t about providing QOS (Quality of Service) across the net to create a better online experience. It’s about the major carriers limiting competition to their archaic cash cows.

    When bittorrenting was the offender, they could provide legitimate arguments for using application based filtering and traffic shaping because the activities being blocked were potentially illegal. With the introduction of high quality internet-based video streaming services like Netflix and Hulu, there’s no such argument against it (except horror stories about bandwidth hogging).

    The fact is, because of the bandwidth limits that the cable companies attach to broadband internet, services like Netflix weren’t feasible until they could be designed to downgrade streaming quality dynamically when the network is under heavy load.

    Right now, I can (and do) regularly gain access to on demand HD streaming Netflix content on my TV through an XBox 360 that puts cable TV to shame. Hulu Premium is well on its way to doing the same but covering the market of the latest tv episodes available on TV. Anybody who has seen this in action will agree that traditional TV (with its 1:1 advertising to content ratios) is obsolete.

    It isn’t about resources. If TV networks spent a fraction of the resources that they’ve committed to making traditional TV move to HD on improving the networking infrastructure, there would be no bandwidth issues. But, as the current platform stands there’s no incentive for them to do so because their real cash cow is TV. Ever wondered why cable companies usually limit consumer bandwidth to <20Mb/sec. Because, if they allowed more then it would be feasible to stream HD content to multiple TV's in a household (and the service would be much cheaper and higher quality than traditional TV).

  10. Wish everyone would think about the small time ISP’s also.. especially the wireless ones… We are located in Kansas and with a small subscriber base of about 1500-2000 customers. We mainly service people who are outside the coverage area of cable and dsl companies that still need internet… With the terrain here we are forced to use a lot of 900mhz AP’s from Motorola which are capable of doing about 3-5Mb/s at a cost of a couple thousand dollars per AP. You tell me how it is that we are supposed to get Netflix to everyone customer… Because our usage has been dramatically increasing to the point where we are handling constant phone calls everyday from customers who can’t stream or their internet is slow (due to the fact that people on the tower are streaming netflix)

    Our cable and DSL companies are even choked down here, Netflix is a great service and it is used at my house also, I think it may just be a bit to a head of its time till everyone starts getting fiber to the home or bandwidth amounts increase… as for now its just a node/tower hog that needs to be blocked

  11. Netflix is a GREAT INNOVATIVE COMPANY, any negative statements you are making about them are stuipd and make no logical sense. The reason they have 20% and growing is because they are great and INNOVATIVE! There will always be unfair people like you and other old cable companies and old dumb stuborn TVs and people that will try to kick Netfix in the ASS. But thank GOD for NET NEUTRALITY, the greatest LAW IN THE WORLD besides the CONSTITUTION, protecting that which is FAIR AND USED ON THE INTERNET instead of letting a few greedy stupid old controlling idiots decide what people should choose! To the writer of this article, maybe we should control the words which come out of your mouth and banish mouth neutrality also, that which is called the FIRST AMMENDMENT OF THE US CONSTITUTION! FREEDOM, not, CONTROL !

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