Netflix just confirmed that it will pay Verizon for direct access through the carrier's network, allowing for improved streaming video for customers. According to a brief statement, "We have reached an interconnect arrangement with Verizon that we hope will improve performance for our joint customers over the coming months." The announcement mirrors a similar peering deal inked earlier this year made by Netflix and Comcast, and likely won't be the last of its kind.
The details of the arrangement are currently confidential. However, they surely must come as a foregone conclusion at least for Verizon CEO Lowell McAdam, who said that he expected to sign a deal with the streaming company days after the Comcast agreement. However, the deal flies in the face of the stance Netflix has thus far espoused, saying that preferential treatment violates their definition of true and total net neutrality. In an impassioned blog post, CEO Reed Hastings wrote, "The essence of net neutrality is that ISPs such as AT&T and Comcast don't restrict, influence or otherwise meddle with the choices consumers make." After the company made what many saw as a Faustian pact with Comcast in February for direct connectivity, Hastings conceded that the company would reluctantly make deals of that kind going forward, while still fighting for net neutrality.
Future deals are by now a sure bet
Verizon has long had issues with Netflix streaming, causing observers to accuse the carrier of throttling the service. Even though the company has officially denied any issues on their end, it did imply that users having issues with content might be the fault of Netflix itself. With the new deal in place, those complaints will likely vanish. But it also means similar deals with other carriers are a sure bet.
Update 7:40PM ET: A previous version of this post incorrectly equated preferential treatment with the peering agreement Netflix has signed, and stated that the Comcast deal was a one-time agreement. The piece has since been updated.