The Internet Association, a trade group composed of some of the biggest tech companies in the world, has filed comment with the FCC asking it to intervene in the conflict over payments being demanded by big ISPs. According to a report in The Hill, companies like Comcast and Verizon are charging Netflix and others for direct interconnection to their networks, a move which allows these companies to bypass congestion and avoid service issues like video buffering. The group wrote in its letter that "interconnection should not be used as a choke point to artificially slow traffic or extract unreasonable tolls."
This is the latest volley in a war of words between big internet companies and the ISPs that carry their data into customers' homes. On Friday Verizon published a chart illustrating what it said was the real problem. According to Verizon companies like Netflix are intentionally allowing congestion to develop by trying to push massive amounts of data through a few chosen providers. If Netflix wanted to, Verizon alleges, it could simply spread that data across more third-party transit providers, a slightly more expensive solution that would alleviate the bottlenecks that are causing performance issues. Netflix, on the other hand, says the ISPs are refusing to perform simple upgrades to their system in an attempt to create bottlenecks and extract payment.
"Interconnection should not be used as a choke point to artificially slow traffic or extract unreasonable tolls."
The reality of the situation is that the massive growth in over-the-top video services like Netflix has been so dramatic it has overwhelmed the longstanding business arrangements that kept internet traffic flowing for years. Companies like Cogent, which carry data from Netflix servers to the networks of companies like Comcast and Verizon, have long had a settlement-free peering relationship with the big ISPs. The means the two parties exchange traffic without payment. The problem is that those peering arrangements called for a certain ratio of exchange. In many cases this allowed a 2–1 or even 3–1 ratio of downstream-to-upstream traffic. But Netflix's massive quantity of streaming video, especially during peak hours when millions are tuning in to a new episode of shows like Orange is The New Black, has overwhelmed these peering arrangements.
Netflix traffic has overwhelmed the traditional peering arrangements
Right now these companies can't agree on who should shoulder the cost of upgrading the connections that carry this data so our broadband infrastructure can keep up with the demands of the modern consumer internet. The reality is that these fixes aren't even very expensive, but they have become the center of a bigger battle of the power dynamic between these companies. Netflix has been the leader in calling for an expanded definition of net neutrality that includes interconnection, and with today's letter, they have gained some big allies. The FCC has said it is looking into the matter, but so far has signaled that it does not believe peering and interconnection disputes are part of the discussion over net neutrality.