Netflix is now paying Time Warner Cable for direct access and faster streams

by Stacey Higginbotham

photo: Thinkstock/Devonyu

SUMMARY:

Netflix, the online streaming giant, has signed a paid peering deal with Time Warner Cable, meaning that it now has deals with the four biggest U.S. ISPs.

Time Warner Cable signed a direct interconnection deal with Netflix, making it the fourth of the big four U.S. ISPs to sign paid peering agreements with the streaming video provider. Presumably, this agreement should improve the Netflix viewing experience of Time Warner Cable’s broadband subscribers who also like to tune into Netflix fare.

Time Warner confirmed the deal happened in June and the implementation has been rolling out this month. The interconnection doesn’t come as a huge surprise given that Netflix has signed agreements with Comcast, Verizon and AT&T in the last few months after fighting with the providers directly and through its transit providersLevel 3 and Cogent.

That fighting unfortunately left consumers caught in the middle between Netflix and ISPs as the quality of their video streams suffered and both Netflix and ISPs blamed each other. While Netflix has signed these paid peering agreements with ISPs, it is still arguing before the FCC and in the court of public opinion that these agreements violate the spirit of network neutrality.

Netflix originally tried to address peering issues by offering ISPs access to its own content delivery network called OpenConnect. It signed deals with some U.S.-based and a number of international ISPs that led to Netflix deploying caching boxes inside the ISPs’ networks. But the major U.S. ISPs argued that Netflix was avoiding paying for the burden its traffic put on their networks and said they didn’t want to support different servers for every different internet service on the market, despite already hosting servers for sites such as Google, Facebook, Amazon and Microsoft in many cases.

However, apparently Apple, as it is building out its own content delivery network, has signed paid peering agreements with ISPs, perhaps marking a shift in how the big content companies and ISPs will broker traffic going forward.

Meanwhile, the FCC is gathering data on these deals, so we may see them quietly eliminated, continue as before but now with tacit FCC approval, or perhaps regulated depending on what it discovers. I’m just eager to see the data about end-to-end broadband quality make its way to the consumer.

Because over the top services are so fragmented, there’s a lot that could go wrong. It would be nice to get an understanding of what’s happening between my television and the Netflix server.

Updated: I removed the traceroute, because it was truncated. I’ll replace it with a complete one when I get one showing the direct hops again.